Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor the Borrower will, nor will they permit any Restricted Subsidiary or Intermediate Parent to, make or hold any Investment, except: (a) Permitted Investments at the time such Permitted Investment is made; (b) loans or advances to officers, directors and employees of Holdings, any Intermediate Parent, the Borrower and the Restricted Subsidiaries (i) for reasonable and customary business-related travel, entertainment, relocation and analogous ordinary business purposes, (ii) in connection with such Person’s purchase of Equity Interests in Holdings (or any direct or indirect parent thereof) (provided that the amount of such loans and advances made in cash to such Person shall be contributed to the Borrower in cash as common equity or Qualified Equity Interests) and (iii) for purposes not described in the foregoing clauses (i) and (ii); provided that at the time of incurrence thereof and after giving Pro Forma Effect thereto, the aggregate principal amount outstanding in reliance on this clause (iii) shall not exceed $1,000,000; (c) Investments by Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary in any of Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary; provided that the aggregate outstanding amount of Investments made by Loan Parties in Restricted Subsidiaries that are not Loan Parties in reliance on this clause (c) shall not exceed the greater of $10,000,000 and 35% of Consolidated EBITDA; (d) Investments consisting of prepayments to suppliers in the ordinary course of business; (e) Investments consisting of extensions of trade credit in the ordinary course of business; (f) Investments (i) existing or contemplated on the date hereof and set forth on Schedule 6.04(f) and any modification, replacement, renewal, reinvestment or extension thereof and (ii) Investments existing on the date hereof by Holdings, the Borrower or any Restricted Subsidiary in the Borrower or any Restricted Subsidiary and any modification, renewal or extension thereof; provided that the amount of the original Investment is not increased except by the terms of such Investment to the extent as set forth on Schedule 6.04(f) or as otherwise permitted by this Section 6.04; (g) Investments in Swap Agreements permitted under Section 6.01(a)(vi); (h) promissory notes and other non-cash consideration received in connection with Dispositions permitted by Section 6.05; (i) Permitted Acquisitions; (j) the Transactions; (k) Investments in the ordinary course of business consisting of endorsements for collection or deposit and customary trade arrangements with customers consistent with past practices; (l) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers and customers, from financially troubled account debtors or in settlement of delinquent obligations of, or other disputes with, customers and suppliers or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment; (m) loans and advances to Holdings (or any direct or indirect parent thereof) or any Intermediate Parent in lieu of, and not in excess of the amount of (after giving effect to any other loans, advances or Restricted Payments in respect thereof), Restricted Payments to the extent permitted to be made to Holdings (or such parent) or such Intermediate Parent in accordance with Section 6.08(a); (n) additional Investments and other acquisitions; provided that at the time any such Investment or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition made in reliance on this clause (n), together with the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (n), shall not exceed the sum of (A) the greater of $18,000,000 and 60% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Investment or other acquisition, plus (B) so long as no Event of Default has occurred and is continuing, the Available Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of such Investment; (o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby; (p) advances of payroll payments to employees in the ordinary course of business; (q) Investments and other acquisitions to the extent that payment for such Investments is made with Qualified Equity Interests (excluding Cure Amounts) of Holdings (or any direct or indirect parent thereof or the IPO Entity); provided that (i) such amounts used pursuant to this clause (q) shall not increase the Available Amount and (ii) any amounts used for such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof or the IPO Entity) shall otherwise be permitted pursuant to this Section 6.04; (r) Investments of a Subsidiary acquired after the Effective Date or of a Person merged or consolidated with any Subsidiary in accordance with this Section and Section 6.03 after the Effective Date to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger or consolidation and were in existence on the date of such acquisition, merger or consolidation; (s) non-cash Investments in connection with tax planning and reorganization activities; provided that after giving effect to any such activities, the security interests of the Lenders in the Collateral, taken as a whole, would not be materially impaired; (t) Investments consisting of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference to this Section 6.04(t)) under Sections 6.01, 6.02, 6.03, 6.05 and 6.08, respectively; (u) additional Investments; provided that after giving effect to such Investment (A) on a Pro Forma Basis, the Total Net Leverage Ratio is less than or equal to 4.50 to 1.00 and (B) there is no continuing Event of Default; (v) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the Borrower; (w) to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Property, or other rights, in each case in the ordinary course of business; (x) Investments by an Unrestricted Subsidiary entered into prior to the day such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to the definition of “Unrestricted Subsidiary”; (y) Investments consisting of purchases of assets of Franchisees (including, but not limited to, area development contracts owned by Franchisees) in the ordinary course of business or otherwise in an amount not exceeding $60,000,000, so long as (A) no Event of Default shall have occurred and be continuing and (B) the Borrower is in pro forma compliance with the Financial Covenant after giving effect to any such purchase; (z) So long as no Event of Default shall have occurred and be continuing, Investments in Franchisees (including, but not limited to, (i) Guarantees or other credit support of any Indebtedness and other liabilities thereof and (ii) loans, advances or contributions to the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater of $20,000,000 and 70% of Consolidated EBITDA; (aa) Investments consisting of accounts and payment intangibles owing to the Borrower or any of the Restricted Subsidiaries from Franchisees; provided that such obligation shall be on such terms as the Borrower or the applicable Restricted Subsidiary establishes in good faith; and (bb) Investments consisting of advances or expenditures by any Loan Party to, or on behalf of, any CMF Subsidiary in support of advertising and marketing programs in the ordinary course consistent with current practices. For purposes of determining compliance with this Section 6.04, in the event that any item of Investment meets the criteria of more than one of the categories of Investments described in clauses (a) through (bb) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such Investment (or any portion thereof) and will only be required to include the amount and type of such Investment in one or more of the above clauses.
Appears in 3 contracts
Samples: Incremental Assumption and Amendment (European Wax Center, Inc.), Incremental Assumption and Amendment (European Wax Center, Inc.), Credit Agreement (European Wax Center, Inc.)
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor the Borrower will, nor will they permit any Restricted Subsidiary or Intermediate Parent to, make or hold any Investment, except:
(a) Permitted Investments at the time such Permitted Investment is made;
(b) loans or advances to present or former officers, directors directors, managers, members of management, consultants, independent contractors and employees of Holdings, any Intermediate Parent, the Borrower Holdings and the Restricted Subsidiaries (i) for reasonable and customary business-related travel, entertainment, relocation and analogous ordinary business purposes, (ii) in connection with such Person’s purchase of Equity Interests in Holdings (or any direct or indirect parent thereof) (provided that the amount of such loans and advances made in cash to such Person shall be contributed to the Borrower Holdings in cash as common equity or Qualified Equity Interests) and (iii) for purposes not described in the foregoing clauses (i) and (ii); provided that at the time of incurrence thereof and after giving Pro Forma Effect pro forma effect thereto, the aggregate principal amount outstanding in reliance on this clause (iii) shall not exceed $1,000,0002,500,000;
(c) Investments (i) by Holdings or any Restricted Subsidiary in any Loan Party (other than Holdings); provided that to the extent the aggregate amount of Investments by a Restricted Subsidiary that is not a Loan Party in a Loan Party exceeds $1,000,000, such non-Loan Party Restricted Subsidiary shall have acceded to the Pari Passu Intercreditor Agreement pursuant to the terms thereof, (ii) by any Restricted Subsidiary that is not a Loan Party in any other Restricted Subsidiary that is also not a Loan Party, (iii) by Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary (A) in any of Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary; provided that (x) the aggregate outstanding amount of such Investments made by Loan Parties after the Effective Date in Restricted Subsidiaries that are not Loan Parties in reliance on this clause (iii)(A), together with the aggregate amount of (x) all other Investments made in and Dispositions made to Restricted Subsidiaries that are not Loan Parties by any Loan Parties after the Effective Date and (y) all Investments and Dispositions made in reliance on Section 6.16(ii), shall not exceed, at the time of the making thereof and after giving pro forma effect thereto, $7,500,000, (y) no Event of Default has occurred and is continuing and (z) all Investments made by Loan Parties in Restricted Subsidiaries that are not Loan Parties in reliance on this clause (ciii)(A) shall be made only for the purpose of financing working capital needs of such non Loan Parties or another purpose agreed to by the Required Lenders (such consent not exceed to be unreasonably withheld, conditioned or delayed; provided, that it is acknowledged and agreed that it shall not be unreasonable to withhold consent to any such transaction that will have a material adverse impact on the greater Guarantees or the Collateral) and shall be evidenced by an intercompany note that has been pledged as Collateral, (B) [reserved] or (C) constituting Guarantees of $10,000,000 Indebtedness or other monetary obligations of Restricted Subsidiaries that are not Loan Parties owing to any Loan Party, (iv) [reserved], (v) subject to the consent of the Required Lenders (such consent not to be unreasonably withheld, conditioned or delayed; provided, that it is acknowledged and 35% agreed that it shall not be unreasonable to withhold consent to any such transaction that will have a material adverse impact on the Guarantees or the Collateral), by Holdings, the Borrower or any Restricted Subsidiary in any Restricted Subsidiary that is not a Loan Party, consisting of Consolidated EBITDAthe contribution of Equity Interests of any other Restricted Subsidiary that is not a Loan Party so long as the Equity Interests of the transferee Restricted Subsidiary is pledged to secure the Secured Obligations;
(d) Investments consisting of deposits, prepayments and/or other credits to suppliers in the ordinary course of business;
(e) Investments consisting of extensions of trade credit in the ordinary course of business;
(f) Investments (i) existing or contemplated on the date hereof and set forth on Schedule 6.04(f) and any modification, replacement, renewal, reinvestment or extension thereof and (ii) Investments existing on the date hereof Effective Date by Holdings, the Borrower or any Restricted Subsidiary in the Borrower or any Restricted Subsidiary and any modification, renewal or extension thereof; provided that the amount of the original Investment is not increased except by the terms of such Investment to the extent as set forth on Schedule 6.04(f) or as otherwise permitted by this Section 6.04;
(g) Investments in Swap Agreements permitted under Section 6.01(a)(vi)6.01;
(h) promissory notes and other non-cash consideration received in connection with Dispositions permitted by Section 6.05;
(i) Permitted AcquisitionsInvestments made in connection with the Transactions (other than borrowings under the ABL North America Credit Agreement);
(j) subject to the Transactionsconsent of the Required Lenders (such consent not to be unreasonably withheld, conditioned or delayed; provided, that it is acknowledged and agreed that it shall not be unreasonable to withhold consent to any such transaction that will have a material adverse impact on the Guarantees or the Collateral), Investments made by any Loan Party in any non-Loan Party consisting of contributions or other Dispositions of Equity Interests of Persons that are non-Loan Parties; provided that, prior to such contribution or Disposition, such Equity Interests were not owned directly by a Loan Party or such Equity Interests are contributed or disposed to a Non-Loan Party that is a wholly owned Restricted Subsidiary of a Loan Party;
(k) Investments in the ordinary course of business consisting of endorsements for collection or deposit and customary trade arrangements with customers consistent with past practices;
(l) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers and customers, from financially troubled account debtors or in settlement of delinquent obligations of, or other disputes with, customers and suppliers or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment;
(m) loans subject to the consent of the Required Lenders (such consent not to be unreasonably withheld, conditioned or delayed; provided, that it is acknowledged and advances agreed that it shall not be unreasonable to Holdings withhold consent to any such transaction that will have a material adverse impact on the Guarantees or the Collateral), cash or property distributed from any Restricted Subsidiary that is not a Loan Party (or any direct or indirect parent thereofi) or any Intermediate Parent in lieu ofmay be contributed to other Restricted Subsidiaries that are not Loan Parties, and not (ii) may pass through Holdings, the Borrower and/or any intermediate Restricted Subsidiaries in excess of order to effect the amount of contribution described in clause (after giving effect to any other loans, advances or Restricted Payments in respect thereofi), Restricted Payments to the extent so long as part of a series of related transactions and such transaction steps are not unreasonably delayed and are otherwise permitted to be made to Holdings (or such parent) or such Intermediate Parent in accordance with Section 6.08(a)hereunder;
(n) additional Investments and other acquisitionsacquisitions made and held by the Loan Parties (other than Holdings); provided that at the time any such Investment or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition made in reliance on this clause (n), together with (including the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (n)), whether in the form of Indebtedness assumed or otherwise), shall not exceed the sum of (A) the greater of $18,000,000 and 60% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Investment or other acquisition, plus (B) so long as no Event of Default has occurred and is continuing, the Available Amount that is Not Otherwise Applied as in effect immediately prior to at the time of making incurrence thereof and after giving pro forma effect thereto, $2,500,000; provided that (x) the aggregate amount of such InvestmentInvestments made by Loan Parties after the Effective Date in Restricted Subsidiaries that are not Loan Parties in reliance on this clause (n), together with the aggregate amount of (x) all other Investments made in and Dispositions made to Restricted Subsidiaries that are not Loan Parties by Loan Parties after the Effective Date and (y) all Investments and Dispositions made in reliance on Section 6.16(ii), shall not exceed, at the time of the making thereof and after giving pro forma effect thereto, $7,500,000 at any time outstanding and (y) all Investments made by Loan Parties in Restricted Subsidiaries that are not Loan Parties in reliance on this clause (n) shall be made only for the purpose of financing working capital needs of such non Loan Parties or another purpose agreed to by the Required Lenders (such consent not to be unreasonably withheld, conditioned or delayed; provided, that it is acknowledged and agreed that it shall not be unreasonable to withhold consent to any such transaction that will have a material adverse impact on the Guarantees or the Collateral) and shall be evidenced by an intercompany note that has been pledged as Collateral;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby[reserved];
(p) advances of payroll payments to employees in the ordinary course of business;
(q) Investments and other acquisitions to the extent that payment for such Investments is made with Qualified Equity Interests (excluding Cure Amounts) of Holdings (or any direct or indirect parent thereof or the IPO Entity)Holdings; provided that (i) such amounts used pursuant to this clause (q) shall not increase the Available Amount and (ii) any other amounts used for such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof or the IPO Entity) shall otherwise be permitted pursuant to this Section 6.04;
(r) Investments of a Subsidiary acquired after the Effective Date or of a Person merged or consolidated with any Subsidiary in accordance with this Section and Section 6.03 after the Effective Date to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger or consolidation and were in existence on the date of such acquisition, merger or consolidation[reserved];
(s) non-cash Investments in connection with tax planning and reorganization activities; provided that after giving effect to any such activities, the security interests of the Lenders in the Collateral, taken as a whole, would not be materially impaired[reserved];
(t) Investments consisting of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference to this Section 6.04(t)) under Sections 6.01, 6.02, 6.03, 6.05 and 6.08, respectively;
(u) additional Investments; provided that after giving effect to such Investment (A) on a Pro Forma Basis, the Total Net Leverage Ratio is less than or equal to 4.50 to 1.00 and (B) there is no continuing Event of Default[reserved];
(v) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers of Holdings or any Restricted Subsidiary or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the BorrowerHoldings;
(w) to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Property, or other rights, in each case in the ordinary course of business;
(x) Investments by an Unrestricted Subsidiary entered into prior to the day such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to the definition of “Unrestricted Subsidiary”[reserved];
(y) Investments consisting of purchases of assets of Franchisees (including, but not limited to, area development contracts owned by Franchisees) in the ordinary course of business or otherwise in an amount not exceeding $60,000,000, so long as (A) no Event of Default shall have occurred and be continuing and (B) the Borrower is in pro forma compliance with the Financial Covenant after giving effect to any such purchase[reserved];
(z) So long as no Event of Default shall have occurred and be continuing, Investments in Franchisees (including, but not limited to, (i) Guarantees or other credit support of any Indebtedness and other liabilities thereof and (ii) loans, advances or contributions to the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater of $20,000,000 and 70% of Consolidated EBITDA[reserved];
(aa) Investments consisting of accounts and payment intangibles owing to the Borrower or any of the Restricted Subsidiaries from Franchisees; provided that such obligation shall be on such terms as the Borrower or the applicable Restricted Subsidiary establishes in good faith[reserved]; and
(bb) Investments consisting unfunded pension fund and other employee benefit plan obligations and liabilities to the extent that the same are permitted to remain unfunded under applicable Requirements of advances or expenditures by any Loan Party to, or on behalf of, any CMF Subsidiary in support of advertising and marketing programs in the ordinary course consistent with current practices. For purposes of determining compliance with this Section 6.04, in the event that any item of Investment meets the criteria of more than one of the categories of Investments described in clauses (a) through (bb) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such Investment (or any portion thereof) and will only be required to include the amount and type of such Investment in one or more of the above clausesLaw.
Appears in 3 contracts
Samples: Forbearance Agreement and First Omnibus Amendment to Credit Agreement and Loan Documents (DG Capital Management, LLC), Forbearance Agreement and First Omnibus Amendment to Credit Agreement and Loan Documents (TENOR CAPITAL MANAGEMENT Co., L.P.), Forbearance Agreement and First Omnibus Amendment to Credit Agreement and Loan Documents (Endurant Capital Management LP)
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor the Borrower willBorrowers will not, nor will they permit any Restricted Subsidiary or Intermediate Parent of a Borrower to, make or hold any Investment, except:
(a) Permitted Investments Cash Equivalents at the time such Permitted Investment is made;
(b) loans or advances to present or former officers, directors directors, managers, members of management, employees, independent contractors and employees consultants of Parent and its Subsidiaries (excluding International Holdings and any Subsidiaries of International Holdings, any Intermediate Parent, the Borrower and the Restricted Subsidiaries ) (i) for reasonable and customary business-related travel, entertainment, relocation and analogous ordinary business purposes, (ii) in connection with such Person’s purchase of Equity Interests in Holdings (or any direct or indirect parent thereof) Parent (provided that the amount of such loans and advances made in cash to such Person shall be contributed to the Borrower Parent in cash as common equity or Qualified Equity Interests) and (iii) for purposes not described in the foregoing clauses (i) and (ii); provided that at the time of incurrence thereof and after giving Pro Forma Effect pro forma effect thereto, the aggregate principal amount outstanding in reliance on this clause (iii) shall not exceed $1,000,000250,000; provided further, that such limitation shall not apply in respect of loans or advances to independent contractors and consultants;
(c) Investments (i) by Holdings, Parent or any Intermediate Parent, the Borrower or any Subsidiary of a Borrower in any Loan Party (other than Parent), (ii) by any Subsidiary of a Borrower that is not a Loan Party in any other Restricted Subsidiary in any of Holdingsa Borrower that is also not a Loan Party, (iii) by Parent, any Intermediate Parent, the Borrower or any Subsidiary of a Borrower (A) in any Restricted SubsidiarySubsidiary of a Borrower; provided that (x) the aggregate outstanding amount of such Investments made by Loan Parties after the Effective Date in Restricted Subsidiaries of a Borrower that are not Loan Parties in reliance on this clause (ciii)(A), together with the aggregate amount of (x) all other Investments made in and Dispositions made to Restricted Subsidiaries of a Borrower that are not Loan Parties by any Loan Parties after the Effective Date and (y) all Investments and Dispositions made in reliance on Section 7.16(ii), shall not exceed, at the time of the making thereof and after giving pro forma effect thereto, $250,000, (y) no Event of Default has occurred and is continuing and (z) all Investments made by Loan Parties in Restricted Subsidiaries of a Borrower that are not Loan Parties in reliance on this clause (iii)(A) shall be made only for the purpose of financing working capital needs of such non Loan Parties or another purpose agreed to by the Required DDTL Approving Lenders (such consent not exceed to be unreasonably withheld, conditioned or delayed; provided, that it is acknowledged and agreed that it shall not be unreasonable to withhold consent to any such transaction that will have a material adverse impact on any Guarantee or the greater Collateral) and shall be evidenced by an intercompany note that has been pledged as Collateral, (B) [reserved] or (C) constituting Guarantees of $10,000,000 and 35% Debt or other monetary obligations of Consolidated EBITDARestricted Subsidiaries of a Borrower that are not Loan Parties owing to any Loan Party, (iv) by Parent, any Borrower or any Subsidiary of a Borrower in Restricted Subsidiaries that are not Loan Parties so long as such transaction is part of a series of simultaneous transactions that results in the proceeds of the initial Investment being invested in one or more Loan Parties (other than Parent), (v) subject to the consent of the Required DDTL Approving Lenders, by Parent, any Borrower or any Subsidiary of a Borrower in any Restricted Subsidiary of a Borrower that is not a Loan Party, consisting of the contribution of Equity Interests of any other Subsidiary of a Borrower that is not a Loan Party so long as the Equity Interests of the transferee Subsidiary is pledged to secure the Obligations;
(d) Investments consisting of deposits, prepayments and/or other credits to suppliers in the ordinary course of business;
(e) Investments consisting of extensions of trade credit in the ordinary course of business;
(f) Investments (i) existing or contemplated on the date hereof and set forth on Schedule 6.04(f7.04(f) and any modification, replacement, renewal, reinvestment or extension thereof and (ii) Investments existing on the date hereof Effective Date by HoldingsParent, the any Borrower or any Restricted Subsidiary in the of a Borrower or any Restricted Subsidiary and any modification, renewal or extension thereof; provided that the amount of the original Investment is not increased except by the terms of such Investment to the extent as set forth on Schedule 6.04(f7.04(f) or as otherwise permitted by this Section 6.047.04;
(g) Investments in Swap Agreements Contracts permitted under Section 6.01(a)(vi)7.01;
(h) promissory notes and other non-cash consideration received in connection with Dispositions permitted by Section 6.057.05;
(i) Permitted AcquisitionsInvestments made in connection with the Reorganization Transactions (other than borrowings under the Term Loan Agreement);
(j) subject to the Transactionsconsent of the Required DDTL Approving Lenders, Investments made by any Loan Party in any non-Loan Party consisting of contributions or other Dispositions of Equity Interests of Persons that are non-Loan Parties; provided that, prior to such contribution or Disposition, such Equity Interests were not owned directly by a Loan Party or such Equity Interests are contributed or disposed to a non-Loan Party that is a wholly- owned Restricted Subsidiary of a Loan Party;
(k) Investments in the ordinary course of business consisting of endorsements for collection or deposit and customary trade arrangements with customers consistent with past practices;
(l) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers and customers, from financially troubled account debtors or in settlement of delinquent obligations of, or other disputes with, customers and suppliers or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment;
(m) loans subject to the consent of the Required DDTL Approving Lenders (such consent not to be unreasonably withheld, conditioned or delayed; provided, that it is acknowledged and advances agreed that it shall not be unreasonable to Holdings withhold consent to any such transaction that will have a material adverse impact on any Guarantee or the Collateral), cash or property distributed from any Subsidiary of a Borrower that is not a Loan Party (or any direct or indirect parent thereofi) or any Intermediate Parent in lieu ofmay be contributed to other Restricted Subsidiaries of a Borrower that are not Loan Parties, and not (ii) may pass through Parent, Borrowers and/or any intermediate Subsidiaries of a Borrower that are Loan Parties in excess of order to effect the amount of contribution described in clause (after giving effect to any other loans, advances or Restricted Payments in respect thereofi), Restricted Payments to the extent so long as part of a series of related transactions and such transaction steps are not unreasonably delayed and are otherwise permitted to be made to Holdings (or such parent) or such Intermediate Parent in accordance with Section 6.08(a)hereunder;
(n) additional Investments and other acquisitionsacquisitions made and held by the Loan Parties (other than Parent); provided that at the time any such Investment or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition made in reliance on this clause (n), together with (including the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (n)), whether in the form of Debt assumed or otherwise), shall not exceed the sum of (A) the greater of $18,000,000 and 60% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Investment or other acquisition, plus (B) so long as no Event of Default has occurred and is continuing, the Available Amount that is Not Otherwise Applied as in effect immediately prior to at the time of making incurrence thereof and after giving pro forma effect thereto, $250,000; provided that (x) the aggregate amount of such InvestmentInvestments made by Loan Parties after the Effective Date in Restricted Subsidiaries of a Borrower that are not Loan Parties in reliance on this clause (n), together with the aggregate amount of (x) all other Investments made in and Dispositions made to Subsidiaries of a Borrower that are not Loan Parties by Loan Parties after the Effective Date and (y) all Investments and Dispositions made in reliance on Section 7.16(ii), shall not exceed, at the time of the making thereof and after giving pro forma effect thereto, $250,000 at any time outstanding and (y) all Investments made by Loan Parties in Restricted Subsidiaries of a Borrower that are not Loan Parties in reliance on this clause (n) shall be made only for the purpose of financing working capital needs of such non Loan Parties or another purpose agreed to by the Required DDTL Approving Lenders (such consent not to be unreasonably withheld, conditioned or delayed; provided, that it is acknowledged and agreed that it shall not be unreasonable to withhold consent to any such transaction that will have a material adverse impact on any Guarantee or the Collateral) and shall be evidenced by an intercompany note that has been pledged as Collateral;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby[reserved];
(p) advances of payroll payments to employees in the ordinary course of business;
(q) Investments and other acquisitions to the extent that payment for such Investments is made with Qualified Equity Interests (excluding Cure Amounts) of Holdings (or any direct or indirect parent thereof or the IPO Entity)Parent; provided that (i) such amounts used pursuant to this clause (q) shall not increase the Available Amount and (ii) any other amounts used for such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof or the IPO Entity) Parent shall otherwise be permitted pursuant to this Section 6.047.04;
(r) Investments of a Subsidiary acquired after the Effective Date or of a Person merged or consolidated with any Subsidiary in accordance with this Section and Section 6.03 after the Effective Date to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger or consolidation and were in existence on the date of such acquisition, merger or consolidation[reserved];
(s) non-cash Investments in connection with tax planning and reorganization activities; provided that after giving effect to any such activities, the security interests of the Lenders in the Collateral, taken as a whole, would not be materially impaired[reserved];
(t) Investments consisting of IndebtednessDebt, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference to this Section 6.04(t7.04(t)) under Sections 6.017.01, 6.027.02, 6.037.03, 6.05 7.05 and 6.087.08, respectively;
(u) additional Investments; provided that after giving effect to such Investment (A) on a Pro Forma Basis, the Total Net Leverage Ratio is less than or equal to 4.50 to 1.00 and (B) there is no continuing Event of Default[reserved];
(v) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers of Parent, any Borrower or any Restricted Subsidiary of a Borrower or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the BorrowerParent;
(w) to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Property, or other rights, in each case in the ordinary course of business;
(x) Investments by an Unrestricted Subsidiary entered into prior to the day such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to the definition of “Unrestricted Subsidiary”[reserved];
(y) Investments consisting of purchases of assets of Franchisees (including, but not limited to, area development contracts owned by Franchisees) in the ordinary course of business or otherwise in an amount not exceeding $60,000,000, so long as (A) no Event of Default shall have occurred and be continuing and (B) the Borrower is in pro forma compliance with the Financial Covenant after giving effect to any such purchase[reserved];
(z) So long as no Event of Default shall have occurred and be continuing, Investments in Franchisees (including, but not limited to, (i) Guarantees or other credit support of any Indebtedness and other liabilities thereof and (ii) loans, advances or contributions to the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater of $20,000,000 and 70% of Consolidated EBITDA[reserved];
(aa) Investments consisting of accounts and payment intangibles owing to the Borrower or any of the Restricted Subsidiaries from Franchisees; provided that such obligation shall be on such terms as the Borrower or the applicable Restricted Subsidiary establishes in good faith[reserved]; and
(bb) Investments consisting of advances or expenditures by any Loan Party to, or on behalf of, any CMF Subsidiary in support of advertising unfunded pension fund and marketing programs in other employee benefit plan obligations and liabilities to the ordinary course consistent with current practices. For purposes of determining compliance with this Section 6.04, in extent that the event that any item of Investment meets the criteria of more than one of the categories of Investments described in clauses (a) through (bb) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such Investment (or any portion thereof) and will only be required same are permitted to include the amount and type of such Investment in one or more of the above clausesremain unfunded under applicable Laws.
Appears in 3 contracts
Samples: Forbearance Agreement and Fourth Amendment to Loan and Security Agreement (TENOR CAPITAL MANAGEMENT Co., L.P.), Forbearance Agreement and Fourth Amendment to Loan and Security Agreement (Endurant Capital Management LP), Forbearance Agreement and Fourth Amendment to Loan and Security Agreement (DG Capital Management, LLC)
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor The Parent and the Borrower willwill not, nor and will they not permit any Restricted Subsidiary or Intermediate Parent to, of the Consolidated Subsidiaries to make or hold permit to exist any Investment, Investment except:
(a) Permitted Investments at the time such and Investments that were Permitted Investment is Investments when made;
(b) loans or advances to officers, directors and employees of Holdings, any Intermediate Parent, the Borrower and the Restricted Subsidiaries (i) for reasonable and customary business-related travel, entertainment, relocation and analogous ordinary business purposes, (ii) in connection with such Person’s purchase of Equity Interests in Holdings (or any direct or indirect parent thereof) (provided that the amount of such Investments constituting intercompany loans and advances made in cash to such Person shall be contributed to the Borrower in cash as common equity or Qualified Equity Interests) and (iii) for purposes not described in the foregoing clauses (ipermitted under Section 11.2(a)(iv) and (ii); ) Investments by any Loan Party in Equity Interests in their respective Wholly-Owned Subsidiaries, provided that at (x) any such Equity Interests held by a Loan Party shall be pledged to the time Agent as collateral security for the obligations of incurrence thereof the Loan Parties under the Loan Documents pursuant to the Loan Documents (subject to the limitations applicable to Foreign Subsidiary Equity Interests referred to in Section 3.4), and (y) in the case of Investments made by the Loan Parties in the Equity Interests of Foreign Consolidated Subsidiaries of the Borrower after giving Pro Forma Effect theretothe Closing Date, the aggregate principal amount outstanding in reliance on this clause (iii) shall such Investments do not exceed $1,000,00025,000,000 at any one time when aggregated with the outstanding principal amount of intercompany loans made by the Loan Parties to Foreign Consolidated Subsidiaries of the Borrower as permitted under Section 11.2(a)(iv);
(c) Investments loans or advances made by Holdings, the Borrower or any Intermediate Subsidiary Loan Party of the Borrower to the Parent, the Borrower or any Restricted Subsidiary in Loan Party, and (y) any such loans and advances made by a Loan Party shall be evidenced by a promissory note pledged to the Agent as collateral security for the obligations of Holdings, any Intermediate the Loan Parties under the Loan Documents and subject to the Intercompany Subordination Agreement;
(d) (i) Guarantees constituting Debt permitted by Section 11.2 and (ii) Guarantees by the Parent, the Borrower or any Restricted Subsidiary; provided that Consolidated Subsidiary of the aggregate outstanding amount obligations (other than Indebtedness) of Investments made by Loan Parties in Restricted Subsidiaries that are not Loan Parties in reliance on this clause (c) shall not exceed the greater Parent, the Borrower or any Wholly Owned Subsidiary of $10,000,000 and 35% of Consolidated EBITDA;
(d) Investments consisting of prepayments to suppliers in the ordinary course of businessBorrower or Parent;
(e) Investments consisting of extensions of trade credit in the ordinary course of business;
(f) Investments (i) existing or contemplated on the date hereof and set forth on Schedule 6.04(f) and any modification, replacement, renewal, reinvestment or extension thereof and (ii) Investments existing on the date hereof by Holdings, the Borrower or any Restricted Subsidiary in the Borrower or any Restricted Subsidiary and any modification, renewal or extension thereof; provided that the amount of the original Investment is not increased except by the terms of such Investment to the extent as set forth on Schedule 6.04(f) or as otherwise permitted by this Section 6.04;
(g) Investments in Swap Agreements permitted under Section 6.01(a)(vi);
(h) promissory notes and other non-cash consideration received in connection with Dispositions permitted by Section 6.05;
(i) Permitted Acquisitions;
(j) the Transactions;
(k) Investments in the ordinary course of business consisting of endorsements for collection or deposit and customary trade arrangements with customers consistent with past practices;
(l) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers and customers, from financially troubled account debtors or in settlement of delinquent obligations of, or other settlement, compromise, or resolution of accounts and disputes withwith or judgments against, customers and suppliers suppliers, in each case in the ordinary course of business or upon Investments acquired by the Borrower or any of the Consolidated Subsidiaries as a result of a foreclosure by the Borrower or any of the Consolidated Subsidiaries with respect to any secured Investment Investments or other transfer of title with respect to any secured InvestmentInvestment in default;
(mf) the following Permitted Acquisitions (it being understood that a Permitted Acquisition may be made using any combination of clauses (i) through (iii) below, as determined by the Borrower):
(i) the Specified Acquisition;
(ii) any Permitted Acquisition funded with the Available Credit; provided that, at the time of such Permitted Acquisition using the Available Credit, the Borrower shall deliver a certificate of a Financial Officer stating the portion of the Purchase Price of such Permitted Acquisition being made from the Available Credit, and setting forth a calculation of the Available Credit immediately before and immediately after such Permitted Acquisition;
(iii) Permitted Acquisitions consummated prior to the Fourth Amendment Effective Date;
(iv) other Permitted Acquisitions, with a total aggregate Purchase Price for all such Permitted Acquisitions under this clause (iv) not exceeding $150,000,000 since the Fourth Amendment Effective Date; provided that the aggregate Purchase Price of all Permitted Acquisitions made under this clause (iv) during any fiscal year shall not exceed $65,000,000, which if unused, may be carried-forward to each subsequent fiscal year; provided further that no Advances under this Agreement may be used directly or indirectly to pay the Purchase Price of any Permitted Acquisition made under this clause (iv);
(v) other Permitted Acquisitions with a total aggregate Purchase Price for all such Permitted Acquisitions under this clause (v) not exceeding the New Senior Notes Net Proceeds Amount;
(vi) other Permitted Acquisitions with a total aggregate Purchase Price for all such Permitted Acquisitions under this clause (vi) not exceeding the aggregate amount of any Qualified IPO Proceeds;
(vii) other Permitted Acquisitions with a total aggregate Purchase Price for all such Permitted Acquisitions under this clause (vii) not exceeding the amount of Incremental Loans (as defined in the Term Loan/Euro RCF Agreement) made under the Term Loan/Euro RCF Agreement after the Fourth Amendment Effective Date; and
(viii) the Permitted Acquisition of the targets referred to as “Drummet”.
(g) loans and advances to Holdings (employees, officers, directors or any direct or indirect parent thereof) or any Intermediate Parent in lieu ofconsultants of the Parent, the Borrower, and not the Consolidated Subsidiaries in excess the ordinary course of the amount of business (after giving effect including, without limitation, for travel, entertainment and relocation expenses and temporary advances to any other loans, advances employees or Restricted Payments directors in respect thereof), Restricted Payments of income taxes related to the exercise of stock options) to the extent permitted under the Xxxxxxxx-Xxxxx Act of 2002, as amended, in an aggregate principal amount not to be made to Holdings (or such parent) or such Intermediate Parent in accordance with Section 6.08(a)exceed $1,000,000 at any time;
(nh) additional Investments by the Borrower and other acquisitions; provided that at the time any such Investment or other acquisition is made, Consolidated Subsidiaries of the aggregate outstanding amount of such Investment or acquisition made Borrower in reliance on this clause (n), together with the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (n), shall not exceed the sum of (A) the greater of $18,000,000 and 60% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Investment or other acquisition, plus (B) so long as no Event of Default has occurred and is continuing, the Available Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of such InvestmentHedging Agreements;
(oi) Holdings extensions of trade credit or the holding of receivables owing to the Borrower or any Consolidated Subsidiary of the Borrower if created or acquired in the ordinary course of business and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction Investments in prepaid expenses, negotiable instruments held for collection and transactions relating thereto or contemplated thereby;
(p) advances of payroll payments to employees lease, utility and workers’ compensation, performance and other similar deposits in the ordinary course of business;
(qj) payroll, travel and similar advances to cover matters that are expected at the time of such advances ultimately to be treated as expenses for accounting purposes and that are made in the ordinary course of business;
(k) Investments that are financed or acquired with Equity Interests of the Parent or Holdings;
(l) Investments set forth on Annex VII (and other acquisitions investments received in respect thereof without the payment of additional cash consideration) and any renewal or replacement thereof on terms and conditions not materially less favorable to the Borrower and its Consolidated Subsidiaries than the terms of the Investment being replaced;
(m) Investments made with Net Proceeds (as defined in the Term Loan/Euro RCF Agreement) to the extent that payment for such permitted to be so applied or reinvested as set forth in the definition of Prepayment Event set forth in the Term Loan/Euro RCF Agreement and as contemplated by Section 2.11(b) of the Term Loan/Euro RCF Agreement;
(n) Investments is received as consideration in connection with sales, transfers or other dispositions permitted under this Agreement;
(o) other Investments made with Qualified Equity Interests by any Loan Party (excluding Cure AmountsInvestments made by the Loan Parties in the Foreign Consolidated Subsidiaries of the Borrower) in an aggregate amount not to exceed $10,000,000 in any fiscal year, which if unused, may be carried-forward to each subsequent fiscal year (up to an aggregate amount of Holdings (or $50,000,000 at any direct or indirect parent thereof or the IPO Entitytime outstanding); provided that after giving effect to the carry forward, no more than $20,000,000 of such Investments shall be made in any fiscal year; provided further that any such Investments made in the form of a loan by a Loan Party to an Unrestricted Subsidiary shall be evidenced by a promissory note pledged to the Agent as collateral security for the obligations of the Loan Parties under the Loan Documents;
(p) the Transactions;
(q) Investments by Holdings in the Equity Interests of WRCA Hong Kong Co., Ltd. on the Closing Date and other Investments made by Holdings and the Consolidated Subsidiaries in the Unrestricted Subsidiaries or in their assets, properties, securities or Debt; provided that the aggregate amount of all Investments under this clause (q) shall not exceed the sum of (i) such amounts the proceeds of the Term Loans in an aggregate amount not to exceed $8,500,000 on the Closing Date, (ii) the proceeds of the Chinese Investment Account (as defined in this Agreement immediately prior to the Fifth Amendment Effective Date) in an aggregate amount not to exceed $10,000,000, (iii) any portion of Investments in the Unrestricted Subsidiaries that is funded with the Available Credit and (iv) any Investment in WRCA Hong Kong Co., Ltd. by Holdings to the extent the proceeds thereof are (A) directly or indirectly the proceeds of an issuance of New Senior Notes (Issued 2010) and (B) promptly used by WRCA Hong Kong Co., Ltd. to repay other Investments made by Holdings and the Consolidated Subsidiaries in WRCA Hong Kong Co., Ltd. pursuant to this clause (q) shall not increase prior to the Fourth Amendment Effective Date; provided further (i) at the time of such Investment made using the Available Amount Credit, the Borrower shall deliver a certificate of a Financial Officer stating the portion of such Investment being made from the Available Credit, and setting forth a calculation of the Available Credit immediately before and immediately after such Investment, (ii) that any amounts used such Investments made in the form of a loan by a Loan Party to the Unrestricted Subsidiaries shall be evidenced by a promissory note pledged to the Agent as collateral security for the obligations of the Loan Parties under the Loan Documents; and (iii) at the time of such an Investment or other acquisition that are not Qualified Equity Interests utilizing funds in the Chinese Escrow Account, the Borrower shall deliver a certificate of Holdings (or a Financial Officer stating the amount of any direct or indirect parent thereof or Investment being made from the IPO Entity) shall otherwise be permitted pursuant to this Section 6.04funds held in the Chinese Investment Account and the remaining balance in the Chinese Investment Account;
(r) Investments of a Consolidated Subsidiary acquired after the Effective Closing Date or of a Person any entity merged into the Parent or the Borrower or merged into or consolidated with a Consolidated Subsidiary after the Closing Date, in each case, (i) to the extent permitted under this Section 11.4, (ii) in the case of any Subsidiary acquisition, merger, consolidation or amalgamation, in accordance with this Section 11.6 and Section 6.03 after the Effective Date (iii) to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger merger, consolidation or consolidation amalgamation and were in existence on the date of such acquisition, merger or consolidationevent;
(s) non-cash Investments made or held by any Loan Party in connection with tax planning and reorganization activitiesany Subsidiary that is a Loan Party at the time of making such Investment; provided that after giving effect to any such activities, the security interests of the Lenders in the Collateral, taken as a whole, would not be materially impaired;and
(t) Investments consisting of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference to this Section 6.04(t)) under Sections 6.01, 6.02, 6.03, 6.05 and 6.08, respectively;
(u) additional Investments; provided that after giving effect to such Investment (A) on the deferred purchase price of property acquired in a Pro Forma Basis, the Total Net Leverage Ratio is less than or equal to 4.50 to 1.00 and (B) there is no continuing Event of Default;
(v) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the Borrower;
(w) to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Property, or other rights, in each case in the ordinary course of business;
(x) Investments by an Unrestricted Subsidiary entered into prior to the day such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to the definition of “Unrestricted Subsidiary”;
(y) Investments consisting of purchases of assets of Franchisees (including, but not limited to, area development contracts owned by Franchisees) in the ordinary course of business or otherwise in an amount not exceeding $60,000,000, so long as (A) no Event of Default shall have occurred and be continuing and (B) the Borrower is in pro forma compliance with the Financial Covenant after giving effect to any such purchase;
(z) So long as no Event of Default shall have occurred and be continuing, Investments in Franchisees (including, but not limited to, (i) Guarantees or other credit support of any Indebtedness and other liabilities thereof and (ii) loans, advances or contributions to the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater of $20,000,000 and 70% of Consolidated EBITDA;
(aa) Investments consisting of accounts and payment intangibles owing to the Borrower or any of the Restricted Subsidiaries from Franchisees; provided that such obligation shall be on such terms as the Borrower or the applicable Restricted Subsidiary establishes in good faith; and
(bb) Investments consisting of advances or expenditures by any Loan Party to, or on behalf of, any CMF Subsidiary in support of advertising and marketing programs in the ordinary course consistent with current practices. For purposes of determining compliance with this Section 6.04, in the event that any item of Investment meets the criteria of more than one of the categories of Investments described in clauses (a) through (bb) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such Investment (or any portion thereof) and will only be required to include the amount and type of such Investment in one or more of the above clausesPermitted Acquisition.
Appears in 3 contracts
Samples: Loan and Security Agreement (WireCo WorldGroup Poland Holdings Sp. z.o.o.), Loan and Security Agreement (1295728 Alberta ULC), Loan and Security Agreement (1295728 Alberta ULC)
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor the Parent Borrower will, nor will they permit any Restricted Subsidiary or Intermediate Parent to, make or hold any Investment, except:
(a) Permitted Investments at the time such Permitted Investment is madeInvestments;
(b) loans or advances to officers, directors and employees of Holdings, any Intermediate Parent, the Parent Borrower and the its Restricted Subsidiaries (i) for reasonable and customary business-related travel, entertainment, relocation and analogous ordinary business purposes, (ii) in connection with such Person’s purchase of Equity Interests in Holdings (or any direct or indirect parent thereof) (provided that the amount of such loans and advances made in cash to such Person shall be contributed to the Borrower in cash as common equity or Qualified Equity Interests) and (iii) for purposes not described in the foregoing clauses (i) and (ii); provided that at the time of incurrence thereof and after giving Pro Forma Effect thereto, the aggregate principal amount outstanding in reliance on this clause (iii) shall not exceed $1,000,000;
(c) Investments (i) by Holdings, any Intermediate Parent, the Parent Borrower or any Restricted Subsidiary in any Loan Party (excluding any new Restricted Subsidiary that becomes a Loan Party pursuant to such Investment), (ii) by any Restricted Subsidiary that is not a Loan Party in any other Restricted Subsidiary that is also not a Loan Party, (iii) by the Parent Borrower or any Restricted Subsidiary (A) in any Restricted Subsidiary that is not a Loan Party, constituting an exchange of Equity Interests of such Restricted Subsidiary for Indebtedness of such Subsidiary or (B) constituting Guarantees of Indebtedness or other monetary obligations of Restricted Subsidiaries that are not Loan Parties owing to any Loan Party, (iv) by Holdings, any Intermediate Parent, the Parent Borrower or any Restricted Subsidiary; provided that the aggregate outstanding amount of Investments made by Loan Parties Subsidiary in Restricted Subsidiaries that are not Loan Parties so long as such transactions is part of a series of simultaneous transactions that result in reliance on this clause the proceeds of the initial Investment being invested in one or more Loan Parties (cor, if the initial proceeds were held at a Restricted Subsidiary that is not a Loan Party, a Restricted Subsidiary that is not a Loan Party) shall and (v) by Holdings, any Intermediate Parent, the Parent Borrower or any Restricted Subsidiary in any Restricted Subsidiary that is not exceed a Loan Party, consisting of the greater contribution of $10,000,000 and 35% Equity Interests of Consolidated EBITDAany other Restricted Subsidiary that is not a Loan Party so long as the Equity Interests of the transferee Restricted Subsidiary is pledged to secure the Secured Obligations;
(d) Investments consisting of prepayments to suppliers in the ordinary course of business;
(e) Investments consisting of extensions of trade credit in the ordinary course of business;
(fe) Investments (i) existing or contemplated on the date hereof Restatement Effective Date and set forth on Schedule 6.04(f6.04(e) and any modification, replacement, renewal, reinvestment or extension thereof and (ii) Investments existing on the date hereof Restatement Effective Date by Holdings, the Parent Borrower or any Restricted Subsidiary in the Parent Borrower or any Restricted Subsidiary and any modification, renewal or extension thereof; provided that the amount of the original Investment is not increased except by the terms of such Investment to the extent as set forth on Schedule 6.04(f6.04(e) or as otherwise permitted by this Section 6.04;
(gf) Investments in Swap Agreements permitted under Section 6.01(a)(vi)6.07;
(hg) promissory notes and other non-cash consideration received in connection with Dispositions permitted by Section 6.05;
(ih) Permitted Acquisitions[Intentionally Omitted];
(ji) the Transactions;
(kj) Investments in the ordinary course of business consisting of Uniform Commercial Code Article 3 endorsements for collection or deposit and Uniform Commercial Code Article 4 customary trade arrangements with customers consistent with past practices;
(lk) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers and customers, from financially troubled account debtors customers or in settlement of delinquent obligations of, or other disputes with, customers and suppliers or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment;
(ml) loans and advances to Holdings (or any direct or indirect parent thereof) or any Intermediate Parent in lieu of, and not in excess of the amount of (after giving effect to any other loans, advances or Restricted Payments in respect thereof), Restricted Payments to the extent permitted to be made to Holdings (or such parent) or such Intermediate Parent in accordance with Section 6.08(a6.08(a)(iv) or (vi);
(nm) additional Investments and other acquisitions; provided that at the time any such Investment or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition made in reliance on this clause (n), together with the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (n), shall not exceed the sum of (A) the greater of $18,000,000 and 60% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Investment or other acquisition, plus (B) so long as no Event of Default has occurred and is continuing, the Available Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of such Investment[Intentionally Omitted];
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby;
(pn) advances of payroll payments to employees in the ordinary course of business;
(qo) Investments and other acquisitions to the extent that payment for such Investments is made with Qualified Equity Interests [Intentionally Omitted];
(excluding Cure Amountsp) of Holdings (or any direct or indirect parent thereof or the IPO Entity); provided that (i) such amounts used pursuant to this clause [Intentionally Omitted];
(q) shall not increase the Available Amount and (ii) any amounts used for such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof or the IPO Entity) shall otherwise be permitted pursuant to this Section 6.04;[Intentionally Omitted]; and
(r) Investments of a Subsidiary acquired after the Effective Date or of a Person merged or consolidated with any Subsidiary in accordance with this Section and Section 6.03 after the Effective Date to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger or consolidation and were in existence on the date of such acquisition, merger or consolidation;
(s) non-cash Investments in connection with tax planning and reorganization activities; provided that after giving effect to any such activities, the security interests of the Lenders in the Collateral, taken as a whole, would not be materially impaired;
(t) Investments consisting of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference to this Section 6.04(t)) under Sections 6.01, 6.02, 6.03, 6.05 and 6.08, respectively;
(u) additional Investments; provided that after giving effect to such Investment (A) on a Pro Forma Basis, the Total Net Leverage Ratio is less than or equal to 4.50 to 1.00 and (B) there is no continuing Event of Default;
(v) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the Borrower;
(w) to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Property, or other rights, in each case in the ordinary course of business;
(x) Investments by an Unrestricted Subsidiary entered into prior to the day such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to the definition of “Unrestricted Subsidiary”;
(y) Investments consisting of purchases of assets of Franchisees (including, but not limited to, area development contracts owned by Franchisees) in the ordinary course of business or otherwise in an amount not exceeding $60,000,000, so long as (A) no Event of Default shall have occurred and be continuing and (B) the Borrower is in pro forma compliance with the Financial Covenant after giving effect to any such purchase;
(z) So long as no Event of Default shall have occurred and be continuing, Investments in Franchisees (including, but not limited to, (i) Guarantees or other credit support of any Indebtedness and other liabilities thereof and (ii) loans, advances or contributions to the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater of $20,000,000 and 70% of Consolidated EBITDA;
(aa) Investments consisting of accounts and payment intangibles owing to the Borrower or any of the Restricted Subsidiaries from Franchisees; provided that such obligation shall be on such terms as the Borrower or the applicable Restricted Subsidiary establishes in good faith; and
(bb) Investments consisting of advances or expenditures by any Loan Party to, or on behalf of, any CMF Subsidiary in support of advertising and marketing programs in the ordinary course consistent with current practices. For purposes of determining compliance with this Section 6.04, in the event that any item of Investment meets the criteria of more than one of the categories of Investments described in clauses (a) through (bb) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such Investment (or any portion thereof) and will only be required to include the amount and type of such Investment in one or more of the above clauses.
Appears in 3 contracts
Samples: Credit Agreement (SMART Global Holdings, Inc.), Credit Agreement (SMART Global Holdings, Inc.), Credit Agreement (SMART Global Holdings, Inc.)
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor the Borrower willwill not, nor and will they not permit any Restricted Subsidiary or Intermediate Parent to, make or hold any Investment, except:
(a) Permitted Investments at the time such Permitted Investment is made;
(b) loans or loans, advances and other credit extensions to officers, directors members of the Board of Directors and employees of Holdings, any Intermediate Parent, the Borrower and Holdings or the Restricted Subsidiaries (i) for reasonable and customary business-related travel, entertainment, relocation (including moving expenses and costs of replacement homes), business machines or supplies, automobiles and analogous ordinary business purposes, (ii) in connection with such Person’s purchase of Equity Interests in of Holdings (or any direct or indirect parent thereof) (provided that the amount of such loans and advances made in cash to such Person shall be contributed to the Borrower Holdings in cash as common equity or Qualified Equity Interests) and (iii) for purposes not described in the foregoing clauses (i) and (ii); provided that at the time of incurrence thereof and after giving Pro Forma Effect thereto, the in an aggregate principal amount outstanding in reliance on under this clause (iii) shall at any time not to exceed $1,000,00010,000,000;
(c) Investments by Holdings, Holdings in any Intermediate Parent, the Borrower or Restricted Subsidiary and Investments by any Restricted Subsidiary in any of Holdings, any Intermediate Parent, the Borrower Holdings or any other Restricted Subsidiary; provided that, in the case of any Investment by a Loan Party in a Restricted Subsidiary that is not a Loan Party or by a Loan Party (other than a CFC Guarantor) to a CFC Guarantor, (i) no Event of Default shall have occurred and be continuing or would result therefrom and (ii) the aggregate outstanding amount of such Investments made by Loan Parties in Restricted Subsidiaries that are not Loan Parties in reliance on this clause (c) shall not exceed exceed, at any time outstanding, the greater of $10,000,000 250,000,000 and 3525% of Consolidated EBITDAEBITDA for the most recently ended Test Period at such time (in each case determined without regard to any write-downs or write-offs and treating the portion of any Investment by a Loan Party (other than a CFC Guarantor) to a CFC Guarantor that is substantially concurrently invested in a Restricted Subsidiary that is not a Loan Party as one Investment in such amount);
(di) Investments consisting of extensions of trade credit and accommodation guarantees in the ordinary course of business and (ii) prepayments and other credits to suppliers made in the ordinary course of business;
(e) Investments consisting of extensions of trade credit in the ordinary course of business;
(f) Investments (i) existing or contemplated on the date hereof Effective Date and set forth on Schedule 6.04(f) 6.04 and any modification, replacement, renewal, reinvestment or extension thereof and (ii) Investments existing on the date hereof Effective Date by Holdings, the Borrower Holdings or any Restricted Subsidiary in the Borrower Holdings or any Restricted Subsidiary and any modification, renewal or extension thereof; provided that the amount of the original Investment is not increased except by the terms of such Investment to the extent as set forth on Schedule 6.04(f) 6.04 or as otherwise permitted by this Section 6.04;
(gf) Investments in Swap Agreements permitted under Section 6.01(a)(vi)incurred in the ordinary course of business and not for speculative purposes;
(hg) promissory notes and other non-cash consideration received in connection with Dispositions permitted by Section 6.05;
(ih) Permitted Acquisitions;
(ji) the Transactions[reserved];
(kj) Investments in the ordinary course of business consisting of Uniform Commercial Code Article 3 endorsements for collection or deposit and Uniform Commercial Code Article 4 customary trade arrangements with customers consistent with past practicesin the ordinary course of business;
(lk) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers and customers, from financially troubled account debtors customers or in settlement of delinquent obligations of, or other disputes with, customers and suppliers or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment;
(ml) (i) loans and advances to Holdings (or any direct or indirect parent thereofof Holdings (x) or any Intermediate Parent in lieu of, and not in excess of the amount of (after giving effect to any other loans, advances or Restricted Payments in respect thereof), Restricted Payments to the extent permitted to be made to Holdings (or such parent) or such Intermediate Parent parent in accordance with Section 6.08(a)6.07(a)(v) (with any such loan or advance reducing the amount of the basket in Section 6.07(a)(v) on a dollar-for-dollar basis) and (y) to the extent the proceeds thereof are contributed or loaned or advanced to any Restricted Subsidiary and (ii) Investments or Guarantees with respect to any direct or indirect parent of Holdings that could otherwise be made as a Restricted Payment under Section 6.07, so long as the amount of such Investment or Guarantee is deducted from the amount available to be made as a Restricted Payment under the applicable clause of Section 6.07;
(nm) additional Investments and other acquisitionsInvestments; provided that at the time any such Investment or other acquisition is mademade and after giving Pro Forma Effect thereto, the aggregate outstanding amount of all such Investment or acquisition Investments made in reliance on this clause (n), together with the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (n), m) shall not exceed the sum of (A) the greater of $18,000,000 250,000,000 and 6025% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making as of such Investment or other acquisitiontime, plus (B) so long as no Event of Default has occurred and is continuing, the Available Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of such Investment, plus (C) the Available Equity Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of such Investment plus (D) the amount of Restricted Payments permitted to be made under Section 6.07(a)(xvi) (so long as the amount of any such Investment is deducted from the amount available to be made as a Restricted Payment under Section 6.07(a)(xvi) and a payment of Junior Financing under Section 6.07(b)(iv)(D)) (in each case determined without regard to any write-downs or write-offs); provided further that in the case of clauses (B) and (C), no Event of Default shall have occurred or would result therefrom;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby;
(pn) advances of payroll payments to employees in the ordinary course of business;
(qo) Investments and other acquisitions to the extent that payment for such Investments is made with Qualified Equity Interests (excluding Cure Amounts) of Holdings (or any direct or indirect parent thereof or the IPO Entitythereof); provided that (i) such amounts used pursuant to this clause (q) shall not increase the Available Amount and (ii) any amounts used for such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof or the IPO Entity) shall otherwise be permitted pursuant to this Section 6.04;
(rp) Investments of a Restricted Subsidiary acquired after the Effective Date or of a Person merged or consolidated with Holdings or any Restricted Subsidiary in accordance with this Section 6.04 and Section 6.03 after the Effective Date or that otherwise becomes a Restricted Subsidiary (provided that if such Investment is made under Section 6.04(h), existing Investments in subsidiaries of such Restricted Subsidiary or Person shall comply with the requirements of Section 6.04(h)) to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger or consolidation and were in existence on the date of such acquisition, merger or consolidation;
(q) receivables owing to Holdings or any Restricted Subsidiary, if created or acquired in the ordinary course of business;
(r) Investments (A) for utilities, security deposits, leases and similar prepaid expenses incurred in the ordinary course of business and (B) trade accounts created, or prepaid expenses accrued, in the ordinary course of business;
(s) non-cash Investments in Restricted Subsidiaries in connection with tax planning and reorganization activities; provided that that, after giving effect to any such activities, the security interests none of the Lenders in Guarantees provided under the CollateralGuarantee Agreements, taken as a whole, the security interests granted by the Loan Parties under the Security Documents, taken as a whole, or the ability of the Loan Parties to perform their respective obligations under the Loan Documents would not be materially impaired;
(t) additional Investments so long as at the time of any such Investment and after giving effect thereto, (x) no Default or Event of Default exists or would result therefrom and (y) on a Pro Forma Basis, the Senior Secured First Lien Net Leverage Ratio is no greater than 2.50 to 1.00;
(u) Investments consisting of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference to this Section 6.04(t)6.04) under Sections Section 6.01, 6.02, 6.03, 6.05 and 6.086.07, respectively;
(u) additional Investments; provided that after giving effect to such Investment (A) on a Pro Forma Basis, the Total Net Leverage Ratio is less than or equal to 4.50 to 1.00 and (B) there is no continuing Event of Default;
(v) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the Borrowerany Restricted Subsidiary;
(w) to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Property, or other rights, in each case in the ordinary course of business;
(x) Investments by an Unrestricted any Investment in any Subsidiary entered into prior to or any joint venture in connection with intercompany cash pooling or similar arrangements arising, in each case, in the day such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to the definition ordinary course of “Unrestricted Subsidiary”business;
(y) [reserved];
(z) Investments consisting in or relating to a Securitization Subsidiary that, in the good faith determination of purchases Holdings, are necessary or advisable to effect any Qualified Securitization Facility or any repurchase obligation in connection therewith, including Investments of assets funds held in accounts permitted or required by the arrangements governing such Qualified Securitization Facilities or any related Indebtedness;
(aa) [reserved];
(bb) [reserved];
(cc) Investments in joint ventures and Unrestricted Subsidiaries; provided that at the time of Franchisees any such Investment and after giving Pro Forma Effect thereto, the aggregate outstanding amount of all such Investments made in reliance on this clause (includingcc) shall not exceed the greater of $125,000,000 and 12.5% of Consolidated EBITDA for the most recently ended Test Period as of such time (in each case determined without regard to any write-downs or write-offs);
(dd) [reserved]; and
(ee) to the extent they constitute Investments, but not limited to, area development contracts owned by Franchisees) guaranties in the ordinary course of business or otherwise in an amount not exceeding $60,000,000of the obligations of suppliers, so long as (A) no Event of Default shall have occurred customers, franchisees, lessors and be continuing and (B) the Borrower is in pro forma compliance with the Financial Covenant after giving effect to any such purchase;
(z) So long as no Event of Default shall have occurred and be continuing, Investments in Franchisees (including, but not limited to, (i) Guarantees or other credit support licensees of any Indebtedness Co-Borrower and other liabilities thereof and (ii) loans, advances or contributions to the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater of $20,000,000 and 70% of Consolidated EBITDA;
(aa) Investments consisting of accounts and payment intangibles owing to the Borrower or any of the Restricted Subsidiaries from Franchisees; provided that such obligation shall be on such terms as the Borrower or the applicable Restricted Subsidiary establishes in good faith; and
(bb) Investments consisting of advances or expenditures by any Loan Party to, or on behalf of, any CMF Subsidiary in support of advertising and marketing programs in the ordinary course consistent with current practices. For purposes of determining compliance with this Section 6.04, in the event that any item of Investment meets the criteria of more than one of the categories of Investments described in clauses (a) through (bb) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such Investment (or any portion thereof) and will only be required to include the amount and type of such Investment in one or more of the above clausesSubsidiary.
Appears in 2 contracts
Samples: Credit Agreement (Graftech International LTD), Credit Agreement (Graftech International LTD)
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor the The Borrower willwill not, nor and will they not permit any Restricted Subsidiary or Intermediate Parent to, make or hold any Investment, except:
(a) Permitted Investments at the time such Permitted Investment is madeInvestments;
(b) loans or advances to officers, directors and employees of Holdings, any Intermediate Parent, the Borrower and the its Restricted Subsidiaries (i) for reasonable and customary business-related travel, entertainment, relocation and analogous ordinary business purposes, (ii) in connection with such Person’s purchase of Equity Interests in of Holdings (or any direct or indirect parent thereof) (provided that the amount of such loans and advances made in cash to such Person shall be contributed to the Borrower in cash as common equity or Qualified Equity Interests) ), and (iii) for purposes not described in the foregoing clauses (i) and (ii); , provided that at the time of incurrence thereof and after giving Pro Forma Effect thereto, the aggregate principal amount outstanding in reliance on at any time under this clause (iiib) shall not to exceed $1,000,0004,000,000;
(c) Investments (i) by Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary in any of HoldingsLoan Party (excluding any new Restricted Subsidiary that becomes a Loan Party pursuant to such Investment), (ii) by any Intermediate ParentRestricted Subsidiary that is not a Loan Party in any other Restricted Subsidiary that is also not a Loan Party, (iii) by the Borrower or any Restricted Subsidiary (A) in any Restricted Subsidiary; provided that the aggregate outstanding amount of such Investments made by Loan Parties after the Effective Date in Restricted Subsidiaries that are not Loan Parties in reliance on this clause (ciii)(A) (together with the amount of Investments made in Restricted Subsidiaries that are not Loan Parties pursuant to Section 6.04(h)) shall not exceed the greater Non-Loan Party Investment Amount at the time of $10,000,000 any such Investment, (B) in any Restricted Subsidiary that is not a Loan Party, constituting an exchange of Equity Interests of such Restricted Subsidiary for Indebtedness of such Subsidiary or (C) constituting Guarantees of Indebtedness or other monetary obligations of Restricted Subsidiaries that are not Loan Parties owing to any Loan Party, (iv) by the Borrower or any Restricted Subsidiary in Restricted Subsidiaries that are not Loan Parties so long as such Investment is part of a series of simultaneous Investments that result in the proceeds of the initial Investment being invested in one or more Loan Parties and 35% (v) by the Borrower or any Restricted Subsidiary in any Restricted Subsidiary that is not a Loan Party, consisting of Consolidated EBITDAthe contribution of Equity Interests of any other Restricted Subsidiary that is not a Loan Party so long as the Equity Interests of the transferee Restricted Subsidiary is pledged to secure the Secured Obligations;
(d) Investments consisting of prepayments to suppliers extensions of trade credit and accommodation guarantees in the ordinary course of business;
(e) Investments consisting of extensions of trade credit in the ordinary course of business;
(f) Investments (i) existing or contemplated on the date hereof Effective Date and set forth on Schedule 6.04(f6.04(e) and any modification, replacement, renewal, reinvestment or extension thereof and (ii) Investments existing on the date hereof Effective Date by Holdings, the Borrower or any Restricted Subsidiary in the Borrower or any Restricted Subsidiary and any modification, renewal or extension thereof; provided that the amount of the original Investment is not increased except by the terms of such Investment to the extent as set forth on Schedule 6.04(f6.04(e) or as otherwise permitted by this Section 6.04;
(g) Investments in Swap Agreements permitted under Section 6.01(a)(vi);
(h) promissory notes and other non-cash consideration received in connection with Dispositions permitted by Section 6.05;
(i) Permitted Acquisitions;
(j) the Transactions;
(k) Investments in the ordinary course of business consisting of endorsements for collection or deposit and customary trade arrangements with customers consistent with past practices;
(l) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers and customers, from financially troubled account debtors or in settlement of delinquent obligations of, or other disputes with, customers and suppliers or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment;
(m) loans and advances to Holdings (or any direct or indirect parent thereof) or any Intermediate Parent in lieu of, and not in excess of the amount of (after giving effect to any other loans, advances or Restricted Payments in respect thereof), Restricted Payments to the extent permitted to be made to Holdings (or such parent) or such Intermediate Parent in accordance with Section 6.08(a);
(n) additional Investments and other acquisitions; provided that at the time any such Investment or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition made in reliance on this clause (n), together with the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (n), shall not exceed the sum of (A) the greater of $18,000,000 and 60% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Investment or other acquisition, plus (B) so long as no Event of Default has occurred and is continuing, the Available Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of such Investment;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby;
(p) advances of payroll payments to employees in the ordinary course of business;
(q) Investments and other acquisitions to the extent that payment for such Investments is made with Qualified Equity Interests (excluding Cure Amounts) of Holdings (or any direct or indirect parent thereof or the IPO Entity); provided that (i) such amounts used pursuant to this clause (q) shall not increase the Available Amount and (ii) any amounts used for such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof or the IPO Entity) shall otherwise be permitted pursuant to this Section 6.04;
(r) Investments of a Subsidiary acquired after the Effective Date or of a Person merged or consolidated with any Subsidiary in accordance with this Section and Section 6.03 after the Effective Date to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger or consolidation and were in existence on the date of such acquisition, merger or consolidation;
(s) non-cash Investments in connection with tax planning and reorganization activities; provided that after giving effect to any such activities, the security interests of the Lenders in the Collateral, taken as a whole, would not be materially impaired;
(t) Investments consisting of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference to this Section 6.04(t)) under Sections 6.01, 6.02, 6.03, 6.05 and 6.08, respectively;
(u) additional Investments; provided that after giving effect to such Investment (A) on a Pro Forma Basis, the Total Net Leverage Ratio is less than or equal to 4.50 to 1.00 and (B) there is no continuing Event of Default;
(v) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the Borrower;
(w) to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Property, or other rights, in each case in the ordinary course of business;
(x) Investments by an Unrestricted Subsidiary entered into prior to the day such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to the definition of “Unrestricted Subsidiary”;
(y) Investments consisting of purchases of assets of Franchisees (including, but not limited to, area development contracts owned by Franchisees) in the ordinary course of business or otherwise in an amount not exceeding $60,000,000, so long as (A) no Event of Default shall have occurred and be continuing and (B) the Borrower is in pro forma compliance with the Financial Covenant after giving effect to any such purchase;
(z) So long as no Event of Default shall have occurred and be continuing, Investments in Franchisees (including, but not limited to, (i) Guarantees or other credit support of any Indebtedness and other liabilities thereof and (ii) loans, advances or contributions to the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater of $20,000,000 and 70% of Consolidated EBITDA;
(aa) Investments consisting of accounts and payment intangibles owing to the Borrower or any of the Restricted Subsidiaries from Franchisees; provided that such obligation shall be on such terms as the Borrower or the applicable Restricted Subsidiary establishes in good faith; and
(bb) Investments consisting of advances or expenditures by any Loan Party to, or on behalf of, any CMF Subsidiary in support of advertising and marketing programs in the ordinary course consistent with current practices. For purposes of determining compliance with this Section 6.04, in the event that any item of Investment meets the criteria of more than one of the categories of Investments described in clauses (a) through (bb) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such Investment (or any portion thereof) and will only be required to include the amount and type of such Investment in one or more of the above clauses.
Appears in 2 contracts
Samples: Second Lien Credit Agreement (NEP Group, Inc.), Second Lien Credit Agreement (NEP Group, Inc.)
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor the The Borrower willwill not, nor and will they not permit any Restricted Subsidiary or Intermediate Parent to, make or hold any Investment, except:
(a) Permitted Investments at the time such Permitted Investment is mademade and purchases of assets in the ordinary course of business consistent with past practice;
(b) loans or advances to officers, directors members of the Board of Directors and employees of Holdings, any Intermediate Parent, the Borrower and the its Restricted Subsidiaries (i) for reasonable and customary business-related travel, entertainment, relocation and analogous ordinary business purposes, (ii) in connection with such Person’s purchase of Equity Interests in of Holdings (or any direct or indirect parent thereof) (provided that the amount of such loans and advances made in cash to such Person shall be contributed to the Borrower in cash as common equity or Qualified Equity Interests) and (iii) for purposes not described in the foregoing clauses (i) and (ii); provided that at the time of incurrence thereof and after giving Pro Forma Effect thereto, the in an aggregate principal amount outstanding in reliance on under this clause (iii) shall at any time not to exceed $1,000,00030,000,000;
(c) Investments by Holdings, the Borrower in any Intermediate Parent, Restricted Subsidiary and Investments by any Restricted Subsidiary in the Borrower or any Restricted Subsidiary in any of Holdings, any Intermediate Parent, the Borrower or any other Restricted Subsidiary; provided that, in the case of any Investment by a Loan Party in a Restricted Subsidiary that the aggregate outstanding amount is not a Loan Party, no Event of Investments made by Loan Parties in Restricted Subsidiaries that are not Loan Parties in reliance on this clause (c) Default shall not exceed the greater of $10,000,000 have occurred and 35% of Consolidated EBITDAbe continuing or would result therefrom;
(d) Investments consisting of prepayments to suppliers extensions of trade credit and accommodation guarantees in the ordinary course of business;
(e) Investments consisting of extensions of trade credit in the ordinary course of business;
(f) Investments (i) existing or contemplated on the date hereof Effective Date and set forth on Schedule 6.04(f) 6.04 and any modification, replacement, renewal, reinvestment or extension thereof and (ii) Investments existing on the date hereof Effective Date by Holdings, the Borrower or any Restricted Subsidiary in the Borrower or any Restricted Subsidiary and any modification, renewal or extension thereof; provided that the amount of the original Investment is not increased except by the terms of such Investment to the extent as set forth on Schedule 6.04(f) 6.04 or as otherwise permitted by this Section 6.04;
(gf) Investments in Swap Agreements permitted under Section 6.01(a)(vi)incurred in the ordinary course of business and not for speculative purposes;
(hg) promissory notes and other non-cash consideration received in connection with Dispositions permitted by Section 6.05;
(ih) Permitted Acquisitions;
(ji) the Transactions;
(kj) Investments in the ordinary course of business consisting of Uniform Commercial Code Article 3 endorsements for collection or deposit and Uniform Commercial Code Article 4 customary trade arrangements with customers consistent with past practicesin the ordinary course of business;
(lk) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers and customers, from financially troubled account debtors customers or in settlement of delinquent obligations of, or other disputes with, customers and suppliers or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment;
(ml) loans and advances to Holdings (or any direct or indirect parent thereof) or any Intermediate Parent (x) in lieu of, and not in excess of the amount of (after giving effect to any other loans, advances or Restricted Payments in respect thereof), Restricted Payments to the extent permitted to be made to Holdings (or such parent) or such Intermediate Parent in accordance with Section 6.08(a)6.07(a) and (y) to the extent the proceeds thereof are contributed or loaned or advanced to any Restricted Subsidiary;
(nm) additional Investments and other acquisitions; provided that at the time any such Investment or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition made in reliance on this clause (nm), together with the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (nm) (including the aggregate principal amount of all Indebtedness assumed in connection with any such other Investment or acquisition previously made under this clause (m)), shall not exceed the sum of (A) the greater of (i)(A) $18,000,000 195,000,000 and 60(B) 50% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Investment or other acquisition, plus (Bii) so long as immediately after giving effect to any such Investment (x) no Event of Default has occurred and is continuingcontinuing and (y) on a Pro Forma Basis, the Total Net Leverage Ratio does not exceed 7.50 to 1.00 for the most recently ended Test Period, the Available Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of such Investment, plus (iii) the Available Equity Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of such Investment; plus (C) the General Restricted Payment Reallocated Amount; plus (D) the Junior Debt Payment Reallocated Amount;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby;
(pn) advances of payroll payments to employees in the ordinary course of business;
(qo) Investments and other acquisitions to the extent that payment for such Investments is made with Qualified Equity Interests (excluding Qualified Equity Interests the proceeds of which will be applied as Cure Amounts) of Holdings (or any direct or indirect parent thereof or the IPO Entity); provided that (i) such amounts used pursuant to this clause (q) shall not increase the Available Amount and (ii) any amounts used for such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof or the IPO Entity) shall otherwise be permitted pursuant to this Section 6.04;
(rp) Investments of a Subsidiary acquired after the Effective Date or of a Person merged merged, amalgamated or consolidated with any Subsidiary in accordance with this Section 6.04 and Section 6.03 after the Effective Date or that otherwise becomes a Subsidiary (provided that if such Investment is made under Section 6.04(h), existing Investments in subsidiaries of such Subsidiary or Person shall comply with the requirements of Section 6.04(h)) to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger merger, amalgamation or consolidation and were in existence on the date of such acquisition, merger merger, amalgamation or consolidation;
(q) receivables owing to the Borrower or any Restricted Subsidiary, if created or acquired in the ordinary course of business;
(r) Investments (A) for utilities, security deposits, leases and similar prepaid expenses incurred in the ordinary course of business and (B) trade accounts created, or prepaid expenses accrued, in the ordinary course of business;
(s) non-cash Investments in connection with tax planning and reorganization activities; provided that after giving effect to any such activities, the security interests of the Lenders in the Collateral, taken as a whole, would not be materially impaired;
(t) additional Investments so long as at the time of any such Investment and after giving effect thereto, (A) on a Pro Forma Basis, the Senior Secured Net Leverage Ratio is no greater than 7.00 to 1.00 for the most recently ended Test Period and (B) no Event of Default exists or would result therefrom;
(u) Investments consisting of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference to this Section 6.04(t6.04(v)) under Sections 6.01, 6.02, 6.03, 6.05 and 6.086.07, respectively;
(u) additional Investments; provided that after giving effect to such Investment (A) on a Pro Forma Basis, the Total Net Leverage Ratio is less than or equal to 4.50 to 1.00 and (B) there is no continuing Event of Default;
(v) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the Borrower;
(w) to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Property, or other rights, in each case in the ordinary course of business;
(x) any Investment in any Subsidiary or any joint venture in connection with intercompany cash management arrangements or related activities arising in the ordinary course of business;
(y) Investments by an Unrestricted Subsidiary entered into prior to the day such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to the definition of “Unrestricted Subsidiary”;
(yz) Investments consisting in or relating to a Securitization Subsidiary that, in the good faith determination of purchases of assets of Franchisees (the Borrower are necessary or advisable to effect any Qualified Securitization Facility or any repurchase obligation in connection therewith, including, but not limited towithout limitation, area development contracts owned Investments of funds held in accounts permitted or required by Franchiseesthe arrangements governing such Qualified Securitization Facilities or any related Indebtedness; and
(aa) Investments in the ordinary course of business or otherwise in an amount not exceeding $60,000,000, so long as (A) no Event of Default shall have occurred and be continuing and (B) the Borrower is in pro forma compliance with the Financial Covenant after giving effect to any such purchase;
(z) So long as no Event of Default shall have occurred and be continuing, Investments in Franchisees (including, but not limited to, (i) Guarantees or other credit support of any Indebtedness and other liabilities thereof and (ii) loans, advances or contributions to the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater of $20,000,000 and 70% of Consolidated EBITDA;
(aa) Investments consisting of accounts and payment intangibles owing to the Borrower or any of the Restricted Subsidiaries from Franchisees; provided that such obligation shall be on such terms as the Borrower or the applicable Restricted Subsidiary establishes in good faith; and
(bb) Investments consisting of advances or expenditures by any Loan Party to, or on behalf of, any CMF Subsidiary in support of advertising and marketing programs in the ordinary course consistent with current practices. For purposes of determining compliance with this Section 6.04, in the event that any item of Investment meets the criteria of more than one of the categories of Investments described in clauses (a) through (bb) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such Investment (or any portion thereof) and will only be required to include the amount and type of such Investment in one or more of the above clausesSettlements.
Appears in 2 contracts
Samples: Credit Agreement (Sotera Health Co), Credit Agreement (Sotera Health Topco, Inc.)
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings, Intermediate Holdings nor the any Borrower will, nor will they permit any Restricted Subsidiary or Intermediate Parent to, make or hold any Investment, except:
(a) Permitted Investments at the time such Permitted Investment is made;
(b) loans or advances to officers, directors directors, partners and employees of Holdings, any Intermediate ParentHoldings, the Borrower Borrowers and the Restricted Subsidiaries (i) for reasonable and customary business-related travel, entertainment, relocation and analogous ordinary business purposes, (ii) in connection with such Person’s purchase of Equity Interests in Holdings (or any direct or indirect parent thereof) (provided that the amount of such loans and advances made in cash to such Person shall be contributed to the Intermediate Holdings or a Borrower in cash as common equity or Qualified Equity Interests), (iii) [reserved] and (iiiiv) for purposes not described in the foregoing clauses (i) and (ii); provided that at the time of incurrence thereof and after giving Pro Forma Effect thereto, the aggregate principal amount outstanding in reliance on this clause (iiiiv) shall not exceed the greater of $1,000,00055,000,000 and 10% of Consolidated EBITDA for the most recently ended Test Period as of such time;
(c) Investments by Holdings, any Intermediate Parent, the Intermediate Holdings, any Borrower or any Restricted Subsidiary in any of Holdings, any Intermediate Parent, the Intermediate Holdings, any Borrower or any Restricted Subsidiary; provided that, in the case of any Investment by a Loan Party in a Restricted Subsidiary that the aggregate outstanding amount is not a Loan Party, no Event of Investments made by Loan Parties in Restricted Subsidiaries that are not Loan Parties in reliance on this clause (c) Default shall not exceed the greater of $10,000,000 have occurred and 35% of Consolidated EBITDAbe continuing or would result therefrom;
(d) Investments consisting of prepayments to suppliers in the ordinary course of business;
(e) Investments consisting of extensions of trade credit in the ordinary course of business;
(f) Investments (i) existing or contemplated on the date hereof and set forth on Schedule 6.04(f) and any modification, replacement, renewal, reinvestment or extension thereof and (ii) Investments existing on the date hereof by Holdings, the Intermediate Holdings, any Borrower or any Restricted Subsidiary in the Holdings, Intermediate Holdings, any Borrower or any Restricted Subsidiary and any modification, renewal or extension thereof; provided that the amount of the original Investment is not increased except by the terms of such Investment to the extent as set forth on Schedule 6.04(f) or as otherwise permitted by this Section 6.04;
(g) Investments in Swap Agreements permitted under Section 6.01(a)(vi)6.01;
(h) promissory notes and other non-cash consideration received in connection with Dispositions permitted by Section 6.05;
(i) Permitted Acquisitions;
(j) the Transactions;
(k) Investments in the ordinary course of business consisting of endorsements for collection or deposit and customary trade arrangements with customers consistent with past practices;
(l) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers and customers, from financially troubled account debtors or in settlement of delinquent obligations of, or other disputes with, customers and suppliers or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment;
(m) loans and advances to Holdings (or any direct or indirect parent thereof) or any Intermediate Parent in lieu of, and not in excess of the amount of (after giving effect to any other loans, advances or Restricted Payments in respect thereof), Restricted Payments to the extent permitted to be made to Holdings (or such parent) or such Intermediate Parent in accordance with Section 6.08(a);
(n) additional other Investments and other acquisitions; provided that at the time any such Investment or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition all Investments made in reliance on this clause (n), ) together with the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (n) (including the aggregate principal amount of all Indebtedness assumed in connection with any such other acquisition), shall not exceed the sum of (A) the greater of $18,000,000 275,000,000 and 6050% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Investment or other acquisition, plus (B) so long as immediately after giving effect to any such Investment no Event of Default under Section 7.01(a), (b), (h) or (i) has occurred and is continuing, the Available Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of such Investment, plus (C) the Available Equity Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of such Investment, plus (D) the Available RP Capacity Amount;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby;.
(p) advances of payroll payments to employees in the ordinary course of business;
(q) Investments and other acquisitions to the extent that payment for such Investments is made with Qualified Equity Interests (excluding Cure Amounts) of Holdings (or any direct or indirect parent thereof or the IPO Entity); provided that (i) such amounts used pursuant to this clause (q) shall not increase the Available Equity Amount, the Available RP Capacity Amount or be applied to increase any other basket hereunder and (ii) any amounts used for such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof or the IPO Entity) shall otherwise be permitted pursuant to this Section 6.04;
(r) Investments of a Subsidiary acquired after the Effective Date or of a Person merged or consolidated with any Subsidiary in accordance with this Section and Section 6.03 after the Effective Date to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger or consolidation and were in existence on the date of such acquisition, merger or consolidation;
(s) non-cash Investments in connection with tax planning and reorganization activities; provided that after giving effect to any such activities, the security interests of the Lenders in the Collateral, taken as a whole, would not be materially impaired;
(t) Investments consisting of Liens, Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference to this under Section 6.04(t)) under Sections 6.01, 6.02, 6.03, 6.05 and 6.08, respectively, in each case, other than by reference to this Section 6.04(t);
(u) additional Investments; provided that after giving effect to such Investment (Aand for the avoidance of doubt any related incurrence of Indebtedness) on a Pro Forma Basis, (A) the Total Net Leverage Ratio is less than or equal to 4.50 5.00 to 1.00 and (B) there is no continuing Event of Default;
(v) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings, Intermediate Holdings or the a Borrower;
(w) to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Property, or other rights, in each case in the ordinary course of business;
(x) Investments by an Unrestricted Subsidiary entered into prior to the day such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to the definition of “Unrestricted Subsidiary”;
(y) any Investment in a Similar Business; provided that at the time any such Investment is made, the aggregate outstanding amount of all Investments consisting made in reliance on this clause (y) together with the aggregate amount of purchases all consideration paid in connection with all other acquisitions made in reliance on this clause (y), shall not exceed the greater of assets of Franchisees (including, but not limited to, area development contracts owned by Franchisees) in the ordinary course of business or otherwise in an amount not exceeding $60,000,000, so long as (A) no Event of Default shall have occurred and be continuing $165,000,000 and (B) 30% of Consolidated EBITDA for the Borrower is in pro forma compliance with the Financial Covenant most recently ended Test Period after giving effect Pro Forma Effect to any the making of such purchaseInvestment;
(z) So long as no Event of Default shall have occurred and be continuing, Investments in Franchisees Unrestricted Subsidiaries; provided that at the time any such Investment is made, the aggregate outstanding amount of all Investments made in reliance on this clause (including, but not limited to, (iz) Guarantees or other credit support together with the aggregate amount of any Indebtedness and other liabilities thereof and (ii) loans, advances or contributions to the marketing and advertising funds operating all consideration paid in connection with the European Wax Center franchise systems) all other acquisitions made in reliance on this clause (z), shall not to exceed the greater of (A) $20,000,000 165,000,000 and 70(B) 30% of Consolidated EBITDAEBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Investment;
(aa) Investments consisting in Subsidiaries in the form of accounts (A) receivables and payment intangibles owing related assets required in connection with a Permitted Receivables Financing, (B) any Entertainment Assets transferred to a Film/TV Subsidiary (or a special-purpose production entity owned by X.X. Xxxxx and Company, Inc. or other third party firm on behalf of or for the benefit of any Film/TV Subsidiary) in connection with its Permitted Film/TV Business (including, in each case, the contribution or lending of cash and cash equivalents to Subsidiaries to finance the purchase of such assets from Holdings, Intermediate Holdings, a Borrower or any of the other Restricted Subsidiaries from Franchisees; provided that such obligation shall be on such terms as or to otherwise fund required reserves), and (C) customary Guarantees by Loan Parties of obligations of any Film/TV Subsidiary to guilds or other third parties in connection with the Borrower or the applicable Restricted Subsidiary establishes in good faithPermitted Film/TV Business; and
(bb) Investments consisting of advances or expenditures by any Loan Party to, or outstanding on behalf of, any CMF Subsidiary the Effective Date in support of advertising and marketing programs in the ordinary course consistent with current practicesGrandfathered Unrestricted Subsidiaries. For purposes of determining compliance with this Section 6.04, in the event that any item of a proposed Investment (or portion thereof) meets the criteria of more than one of the categories of Investments described in clauses (a) through (bb) above, Holdings shall, in its sole discretion, the Borrowers will be entitled to classify and reclassify or later divide, classify or reclassify (based on circumstances existing on the date of such reclassification) such Investment (or any portion thereof) and will only be required to include the amount and type of between such Investment clauses (a) through (bb), in one or more of the above clausesa manner that otherwise complies with this Section 6.04.
Appears in 2 contracts
Samples: Credit Agreement (Endeavor Group Holdings, Inc.), Credit Agreement (Endeavor Group Holdings, Inc.)
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor the The Borrower willwill not, nor and will they not permit any of its Restricted Subsidiaries to purchase, hold or acquire (including pursuant to any merger with any Person that was not a Wholly Owned Restricted Subsidiary prior to such merger) any Equity Interests in or Intermediate Parent toevidences of Indebtedness or other securities (including any option, warrant or other right to acquire any of the foregoing) of, make or hold permit to exist any loans or advances to, or otherwise lend money to, Guarantee any Indebtedness of, or make or permit to exist any investment in, any other Person or provide other credit support (including the provision of letters of credit for the account of such Person) for any Person or purchase or otherwise acquire (in one transaction or a series of transactions) any assets of any other Person constituting a business unit, line of business or division (each of the foregoing, an “Investment” and collectively, “Investments”), except:
(ai) cash and Permitted Investments at the time such Permitted Investment is madeInvestments;
(b) loans or advances to officers, directors and employees of Holdings, any Intermediate Parent, the Borrower and the Restricted Subsidiaries (i) for reasonable and customary business-related travel, entertainment, relocation and analogous ordinary business purposes, (ii) in connection with such Person’s purchase of Equity Interests in Holdings Investments existing on the Effective Date and set forth on Schedule 6.04; provided that to the extent any loan described on Schedule 6.04 that is owing by a Subsidiary that is not a Loan Party to a Loan Party (the “Scheduled Loans”) (or any direct or indirect parent thereof) (provided that the amount of such loans and advances made in cash to such Person shall be contributed to the Borrower in cash as common equity or Qualified Equity Interests) and (iii) for purposes not described in the foregoing clauses (i) and (ii); provided that at the time of incurrence thereof and after giving Pro Forma Effect thereto, the aggregate principal amount outstanding in reliance on this clause (iii) shall not exceed $1,000,000;
(c) Investments by Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary in any of Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary; provided that the aggregate outstanding amount of additional Investments made by Loan Parties pursuant to this proviso) has been repaid, then additional Investments may be made by Loan Parties in any Restricted Subsidiaries that are not Loan Parties in reliance on an aggregate amount up to the amount actually received by Loan Parties as payment in respect of such Investments; provided further that in no event will the aggregate amount of Scheduled Loans and additional Investments made by Loan Parties in Subsidiaries that are not Loan Parties pursuant to the first proviso of this clause (cii) shall not exceed the greater aggregate original principal amount of $10,000,000 and 35% of Consolidated EBITDAthe Scheduled Loans on the Effective Date;
(d) Investments consisting of prepayments to suppliers in the ordinary course of business;
(e) Investments consisting of extensions of trade credit in the ordinary course of business;
(fiii) Investments (ix) existing or contemplated on among the date hereof and set forth on Schedule 6.04(fLoan Parties, (y) and by any modification, replacement, renewal, reinvestment or extension thereof and (ii) Investments existing on the date hereof by Holdings, the Borrower or any Non-Guarantor Restricted Subsidiary in the Borrower or any Restricted Subsidiary and (z) by any modificationLoan Party in any Non-Guarantor Restricted Subsidiary in an aggregate amount outstanding at any time pursuant to this subclause (z) not to exceed the sum of (1) $300 million, renewal or extension thereof; provided that plus (2) the amount of proceeds of unsecured Permitted Other Debt and the original Investment is proceeds from any borrowings of Incremental Term Loans, in each case, that are incurred after the Effective Date (and that are not increased except by applied to refinance other Indebtedness or to make an acquisition in reliance on clause (d)(iii)(2) of the terms definition of such Investment to the extent as set forth on Schedule 6.04(f) or as otherwise permitted by this Section 6.04;
(g) Investments in Swap Agreements permitted under Section 6.01(a)(viPermitted Acquisition);
(hiv) promissory notes and other nonGuarantees by any Non-cash consideration received in connection with Dispositions U.S. Restricted Subsidiary that is a Non-Guarantor Restricted Subsidiary of Indebtedness permitted by Section 6.056.01(xii);
(i) Permitted Acquisitions;
(j) the Transactions;
(kv) Investments in the ordinary course of business consisting of endorsements for collection or deposit and customary trade arrangements with customers consistent with past practices;
(l) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers and customersof, from financially troubled account debtors or in settlement of delinquent obligations of, or other accounts and disputes with, customers and suppliers or upon trade creditors, in each case in the foreclosure with respect to any secured Investment or other transfer ordinary course of title with respect to any secured Investmentbusiness of the Borrower and its Restricted Subsidiaries;
(mvi) loans and advances to Holdings directors and employees of the Borrower or its Restricted Subsidiaries in the ordinary course of business of the Borrower and its Restricted Subsidiaries (including for travel, entertainment and relocation expenses) (other than any loans or advances to any director or executive officer (or any direct or indirect parent equivalent thereof) or that would violate any Intermediate Parent Requirement of Law in lieu of, and not any material respect) in excess of the an aggregate principal amount of (after giving effect determined without regard to any other loans, advances write-downs or Restricted Payments in respect thereof), Restricted Payments write-offs of such loans and advances) not to the extent permitted to be made to Holdings (or such parent) or such Intermediate Parent in accordance with Section 6.08(a)exceed $5.0 million at any one time outstanding;
(nvii) additional Permitted Acquisitions;
(viii) Investments and other acquisitions; provided that at the time any such Investment in Joint Ventures (A) constituting or consisting of a contribution of or other acquisition is madetransfer or distribution of the assets (other than cash, except that a de minimis cash amount directly related to such assets may be contributed, transferred or otherwise distributed) or capital stock of the Specified Businesses or (B) Investments in Joint Ventures not described in clause (A) in an aggregate outstanding amount of such Investment or acquisition made in reliance on under this clause (n)B) not to exceed $100.0 million at any one time outstanding;
(ix) mergers and consolidations and dissolutions and other transactions permitted under Section 6.03;
(x) Hedging Agreements permitted under Section 6.14;
(xi) Investments in deposit accounts in the ordinary course of business of the Borrower and its Restricted Subsidiaries;
(xii) security deposits required by utility companies and other Persons in a similar line of business to that of utility companies and Governmental Authorities that are utility companies, together with in each case, made in the ordinary course of business of the Borrower and its Restricted Subsidiaries;
(xiii) other Investments in an aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (n), shall at any time outstanding not to exceed the sum of (A) the greater of (x) $18,000,000 75.0 million and 60(y) 3.0% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of Net Tangible Assets at such Investment or other acquisition, time plus (B) so long as no Event the portion, if any, of Default has occurred and is continuing, the Available Amount on the date of such election that is Not Otherwise Applied as Borrower elects to apply to this Section 6.04(xiii); provided that (A) any such Investment held by a Loan Party shall be pledged pursuant to a Pledge Agreement or a Non-U.S. Pledge Agreement in effect immediately prior accordance with, and to the time extent required by, Section 5.11 and (B) any such Investment in the form of making of such Investmenta loan or advance to any Loan Party shall be subordinated to the Obligations on terms reasonably satisfactory to the Administrative Agent;
(oxiv) Holdings Investments consisting of any non-cash portion or any deferred portion (including promissory notes and its Subsidiaries may undertake non-cash consideration) of the sales price received by the Borrower or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated therebyRestricted Subsidiary in connection with any Asset Sale permitted under Section 6.05;
(pxv) advances of payroll payments to employees in the ordinary course of business;
(qxvi) Investments constituting or resulting from (i) accounts receivable arising or acquired or (ii) trade debt granted, in each case in the ordinary course of business;
(xvii) Investments in respect of Treasury Services Agreements permitted under Section 6.01(x);
(xviii) Investments constituting (A) Sale and Leaseback Transactions permitted under Section 6.06 or (B) Restricted Payments permitted under Section 6.07 or (C) resulting from pledges or deposits permitted under Section 6.02;
(xix) the endorsement of negotiable instruments for deposit or collection in the ordinary course of business;
(xx) intercompany receivables created by any distribution or other acquisitions transfer by a Subsidiary to the extent a Loan Party of an intercompany receivable issued by a Subsidiary that payment for such Investments is made with Qualified Equity Interests (excluding Cure Amounts) of Holdings (or any direct or indirect parent thereof or the IPO Entity)not a Guarantor; provided that (i) any Loan Party shall pledge any note evidencing any such amounts used pursuant to this clause (q) shall not increase the Available Amount and (ii) any amounts used for receivable that it receives as a result of such an Investment distribution or other acquisition transfer; provided further, that are not Qualified Equity Interests no Loan Party shall transfer, or otherwise make any payment or other Investment of, cash or cash equivalents in exchange for the receipt of Holdings (or any direct or indirect parent thereof or the IPO Entity) shall otherwise be permitted pursuant to this Section 6.04such intercompany receivables;
(rxxi) any transfer of assets pursuant to Section 6.05(xvi) or Section 6.05(xx) in the form of an Investment;
(xxii) the Contemplated Acquisitions;
(xxiii) Investments of a Subsidiary acquired after the Effective Date or of a Person merged into the Borrower or consolidated with any Subsidiary of its Subsidiaries in accordance with this Section and Section 6.03 after the Effective Date to the extent that such Investments were Investment was not made in contemplation of or in connection with such acquisition, merger or consolidation and consolidation, were in existence on the date of such acquisition, merger or consolidation;consolidation and are not a material portion of such Subsidiary’s assets; and
(s) non-cash Investments in connection with tax planning and reorganization activities; provided that after giving effect to any such activities, the security interests of the Lenders in the Collateral, taken as a whole, would not be materially impaired;
(txxiv) Investments consisting of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference to this Section 6.04(t)) under Sections 6.01, 6.02, 6.03, 6.05 and 6.08, respectively;
(u) additional Investments; provided that after giving effect to such Investment (A) on a Pro Forma Basis, the Total Net Leverage Ratio is less than or equal to 4.50 to 1.00 and (B) there is no continuing Event of Default;
(v) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the Borrower;
(w) to the extent that they constitute Investmentspayment for such Investment is made with Equity Interests or Equity Rights (other than Disqualified Equity Interests) of the Borrower; provided, purchases and acquisitions of inventoryhowever, supplies, materials or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Property, or other rights, in each case that any intercompany Investments in the ordinary course form of business;
(x) Investments a loan or advance held by an Unrestricted Subsidiary entered into prior a Loan Party shall be evidenced by a promissory note in form and substance reasonably satisfactory to the day such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to the definition of “Unrestricted Subsidiary”;
(y) Investments consisting of purchases of assets of Franchisees (includingAdministrative Agent; provided, but not limited tofurther, area development contracts owned by Franchisees) in the ordinary course of business or otherwise in that if an amount not exceeding $60,000,000, so long as (A) no Event of Default shall have occurred and be continuing and (B) the Borrower is in pro forma compliance with the Financial Covenant after giving effect to any such purchase;
(z) So long as no Event of Default shall have occurred and be continuing, Investments in Franchisees (including, but not limited to, (i) Guarantees or other credit support of any Indebtedness and other liabilities thereof and (ii) loans, advances or contributions to the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater of $20,000,000 and 70% of Consolidated EBITDA;
(aa) Investments consisting of accounts and payment intangibles owing to the Borrower or any of the Restricted Subsidiaries from Franchisees; provided that such obligation shall be on such terms as the Borrower or the applicable Restricted Subsidiary establishes in good faith; and
(bb) Investments consisting of advances or expenditures by any Loan Party to, or on behalf of, any CMF Subsidiary in support of advertising and marketing programs in the ordinary course consistent with current practices. For purposes of determining compliance with this Section 6.04, in the event that any item of Investment meets the criteria of more than one of the categories types of Investments described in the clauses (a) through (bb) above, Holdings shall, the Borrower in its sole discretion, discretion may classify and reclassify such action or later divide, classify or reclassify such Investment (or any portion thereof) and will only be required to include the amount and type of such Investment event in one or more clauses (including in part under one such clause and in part under another such clause). The aggregate amount of an Investment at any one time outstanding for purposes of this Section 6.04 shall be deemed to be equal to (A) the above clausesaggregate amount of cash, together with the aggregate fair market value of Property (net of any Transferred Liability), loaned, advanced, contributed, transferred or otherwise invested that gives rise to such Investment (without adjustment for subsequent increases or decreases in the value of such Investment) minus (B) the aggregate amount of dividends, distributions or other payments received in cash in respect of such Investment (including by way of a sale or other disposition of such Investment). In the event that a Loan Party makes an Investment in a Non-Guarantor Restricted Subsidiary for purposes of permitting such Non-Guarantor Restricted Subsidiary or any other Non-Guarantor Restricted Subsidiary to apply the amounts received to make a substantially concurrent Investment (which may be made through any other Non-Guarantor Restricted Subsidiary) in any other Person (that is not also a Non-Guarantor Restricted Subsidiary), the Investment by such Loan Party in such Non-Guarantor Restricted Subsidiary shall not be included as an Investment for purposes of this Section 6.04 to the extent the subsequent Investment by such Non-Guarantor Restricted Subsidiary reduced amounts available to make Investments hereunder. The amount of an Investment shall not in any event be reduced by reason of any write-off of such Investment.
Appears in 2 contracts
Samples: Credit Agreement (Solutia Inc), Credit Agreement (Solutia Inc)
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor the Borrower will, nor will they permit any Restricted Subsidiary to, purchase, hold, acquire (including pursuant to any merger or Intermediate Parent toconsolidation with any Person that was not a wholly-owned Subsidiary prior thereto), make or hold otherwise permit to exist any InvestmentInvestment in any other Person, except:
(a) Permitted Investments at the time such Permitted Investment is madeInvestments;
(b) loans or advances to officers, directors and employees of Holdings, any Intermediate Parent, the Borrower and the Restricted Subsidiaries (i) for reasonable Investments existing on the Closing Date in the Subsidiaries and customary business-related travel(ii) other Investments existing on the Closing Date and set forth on Schedule 6.04 to the Disclosure Letter;
(c) (x) additional Investments by Holdings in any Subsidiary Loan Party and by any Subsidiary Loan Party in another Subsidiary Loan Party, entertainmentand (y) Investments (including by way of capital contributions) by Holdings and its Subsidiaries in Equity Interests in their Subsidiaries; provided, relocation and analogous ordinary business purposesthat, in the case of clause (y), that (i) such subsidiaries are Subsidiaries prior to such Investments, (ii) in connection with any such Person’s purchase of Equity Interests held by a Loan Party shall be pledged in accordance with and to the extent required by the Collateral and Guarantee Requirement and (iii) the aggregate amount of such Investments by the Loan Parties in Subsidiaries that are not Loan Parties pursuant to this clause (y), plus the aggregate amount of loans and advances by the Loan Parties pursuant to Section 6.04(d) to Subsidiaries that are not Loan Parties, plus the aggregate amount of Guarantees by the Loan Parties pursuant to Section 6.04(e) of Indebtedness or other obligations of Subsidiaries that are not Loan Parties (excluding all such Investments, loans, advances and Guarantees existing on the Closing Date and permitted by clause (b) above or permitted under Section 6.04(p), (s) and (t) and (u) below) shall not exceed the greater of (A) $100,000,000 and (B) 25% of Consolidated EBITDA for the four fiscal quarter period most recently ended for which Holdings has delivered financial statements pursuant to Section 5.01(a) or (b) at any time outstanding (in each case determined without regard to any write-downs or any direct or indirect parent thereofwrite-offs) (provided that and with the amount of any such Disposition “outstanding” for such purposes being deemed to be the fair market value of the applicable assets at the time of such Dispositions);
(d) loans or advances made by Holdings to any Subsidiary and made by any Subsidiary to any other Subsidiary; provided, that, (i) any Indebtedness resulting therefrom is permitted by clause (d) of Section 6.01 and (ii) the amount of such loans and advances made in cash to such Person shall be contributed to the Borrower in cash as common equity or Qualified Equity Interests) and (iii) for purposes not described in the foregoing clauses (i) and (ii); provided that at the time of incurrence thereof and after giving Pro Forma Effect thereto, the aggregate principal amount outstanding in reliance on this clause (iii) shall not exceed $1,000,000;
(c) Investments by Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary in any of Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary; provided that the aggregate outstanding amount of Investments made by Loan Parties in Restricted to Subsidiaries that are not Loan Parties shall be subject to the limitation set forth in reliance on this clause (c) shall not exceed the greater of $10,000,000 and 35% of Consolidated EBITDAabove;
(de) Investments consisting Guarantees by Holdings or any Subsidiary of prepayments Indebtedness or other obligations of Holdings or any other Subsidiary (including any such Guarantees arising as a result of any such Person being a joint and several co-applicant with respect to suppliers any letter of credit or letter of guaranty); provided, that, (i) (A) a Subsidiary that has not Guaranteed the Obligations pursuant to the Collateral Agreement shall not Guarantee any Indebtedness of any Loan Party, and (B) any such Guarantee of Subordinated Indebtedness is subordinated to the Loan Document Obligations on terms no less favorable to the Lenders than those of the Subordinated Indebtedness, (ii) any such Guarantee constituting Indebtedness is permitted by Section 6.01, and (iii) the aggregate amount of such Indebtedness (excluding, for the avoidance of doubt, Guarantees of obligations not constituting Indebtedness) of Subsidiaries that are not Loan Parties that is Guaranteed by any Loan Parties shall be subject to the limitation set forth in clause (c) above;
(f) (i) loans or advances to employees of Holdings or any Subsidiary made in the ordinary course of business;
, including those to finance the purchase of Equity Interests of Holdings pursuant to employee plans and (eii) Investments consisting payroll, travel, entertainment, relocation and similar advances to directors and employees of extensions Holdings or any Subsidiary to cover matters that are expected at the time of trade credit such advances to be treated as expenses of Holdings or such Subsidiary for accounting purposes and that are made in the ordinary course of business;
; provided, that, the aggregate principal amount of such loans and advances under this clause (f) Investments (i) existing or contemplated on the date hereof and set forth on Schedule 6.04(f) and outstanding at any modification, replacement, renewal, reinvestment or extension thereof and (ii) Investments existing on the date hereof by Holdings, the Borrower or any Restricted Subsidiary in the Borrower or any Restricted Subsidiary and any modification, renewal or extension thereof; provided that the amount of the original Investment is time shall not increased except by the terms of such Investment to the extent as set forth on Schedule 6.04(f) or as otherwise permitted by this Section 6.04exceed $15,000,000;
(g) Investments in Swap Agreements permitted under Section 6.01(a)(vi);
(h) promissory notes and other non-cash consideration received in connection with Dispositions permitted by Section 6.05;
(i) Permitted Acquisitions;
(j) the Transactions;
(k) Investments in the ordinary course of business consisting of endorsements for collection or deposit and customary trade arrangements with customers consistent with past practices;
(l) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers and customersof, from financially troubled account debtors or in settlement of delinquent obligations of, or other accounts and disputes with, customers and suppliers suppliers, or upon the foreclosure with respect to any secured Investment or other transfer consisting of title with respect to any secured Investment;
(m) loans and advances to Holdings (or any direct or indirect parent thereof) or any Intermediate Parent in lieu of, and not in excess of the amount of (after giving effect to any other loans, advances or Restricted Payments in respect thereof), Restricted Payments to the extent permitted to be made to Holdings (or such parent) or such Intermediate Parent in accordance with Section 6.08(a);
(n) additional Investments and other acquisitions; provided that at the time any such Investment or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition made in reliance on this clause (n), together with the aggregate amount of all consideration paid securities acquired in connection with all other Investments and acquisitions made in reliance on this clause (n), shall not exceed the sum satisfaction or enforcement of (A) the greater of $18,000,000 and 60% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect claims due or owing to the making of such Investment or other acquisition, plus (B) so long as no Event of Default has occurred and is continuing, the Available Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of such Investment;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby;
(p) advances of payroll payments to employees in the ordinary course of business;
(q) Investments and other acquisitions to the extent that payment for such Investments is made with Qualified Equity Interests (excluding Cure Amounts) of Holdings (or any direct or indirect parent thereof or the IPO Entity); provided that (i) such amounts used pursuant to this clause (q) shall not increase the Available Amount and (ii) any amounts used for such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof or the IPO Entity) shall otherwise be permitted pursuant to this Section 6.04;
(r) Investments of a Subsidiary acquired after the Effective Date or of a Person merged or consolidated with any Subsidiary in accordance with this Section and Section 6.03 after the Effective Date to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger or consolidation and were in existence on the date of such acquisition, merger or consolidation;
(s) non-cash Investments in connection with tax planning and reorganization activities; provided that after giving effect to any such activities, the security interests of the Lenders in the Collateral, taken as a whole, would not be materially impaired;
(t) Investments consisting of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference to this Section 6.04(t)) under Sections 6.01, 6.02, 6.03, 6.05 and 6.08, respectively;
(u) additional Investments; provided that after giving effect to such Investment (A) on a Pro Forma Basis, the Total Net Leverage Ratio is less than or equal to 4.50 to 1.00 and (B) there is no continuing Event of Default;
(v) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the Borrower;
(w) to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Property, or other rightsSubsidiary, in each case in the ordinary course of business;
(x) Investments by an Unrestricted Subsidiary entered into prior to the day such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to the definition of “Unrestricted Subsidiary”;
(y) Investments consisting of purchases of assets of Franchisees (including, but not limited to, area development contracts owned by Franchisees) in the ordinary course of business or otherwise in an amount not exceeding $60,000,000, so long as (A) no Event of Default shall have occurred and be continuing and (B) the Borrower is in pro forma compliance with the Financial Covenant after giving effect to any such purchase;
(z) So long as no Event of Default shall have occurred and be continuing, Investments in Franchisees (including, but not limited to, (i) Guarantees or other credit support of any Indebtedness and other liabilities thereof and (ii) loans, advances or contributions to the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater of $20,000,000 and 70% of Consolidated EBITDA;
(aa) Investments consisting of accounts and payment intangibles owing to the Borrower or any of the Restricted Subsidiaries from Franchisees; provided that such obligation shall be on such terms as the Borrower or the applicable Restricted Subsidiary establishes in good faith; and
(bb) Investments consisting of advances or expenditures by any Loan Party to, or on behalf of, any CMF Subsidiary in support of advertising and marketing programs in the ordinary course consistent with current practices. For purposes of determining compliance with this Section 6.04, in the event that any item of Investment meets the criteria of more than one of the categories of Investments described in clauses (a) through (bb) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such Investment (or any portion thereof) and will only be required to include the amount and type of such Investment in one or more of the above clauses.
Appears in 2 contracts
Samples: Credit Agreement (Trinet Group, Inc.), Credit Agreement (Trinet Group, Inc.)
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor the Borrower will, nor will they permit any Restricted Subsidiary or Intermediate Parent to, make or hold any Investment, except:
(a) Permitted Investments at the time such Permitted Investment is madeInvestments;
(b) loans or advances to officers, directors and employees of Holdings, any Intermediate Parent, the Borrower Holdings and the Restricted Subsidiaries (i) for reasonable and customary business-related travel, entertainment, relocation and analogous ordinary business purposes, (ii) in connection with such Person’s purchase of Equity Interests in of Holdings (or any direct or indirect parent thereof) (provided that the amount of such loans and advances made in cash to such Person shall be contributed through each applicable Intermediate Parent to the Borrower or US Bidco in cash as common equity or Qualified Equity Interests) and (iii) for purposes not described in the foregoing clauses (i) and (ii); provided that at the time of incurrence thereof and after giving Pro Forma Effect thereto, the in an aggregate principal amount outstanding in reliance on this clause (iii) shall at any time not to exceed $1,000,0005,000,000;
(c) Investments (i) by Holdings, any Intermediate Parent, the Borrower Holdings or any Restricted Subsidiary in any of HoldingsLoan Party (excluding any new Subsidiary that becomes a Loan Party pursuant to such Investment), (ii) by any Intermediate ParentSubsidiary that is not a Loan Party in any other Subsidiary that is also not a Loan Party, the Borrower or (iii) by any Restricted Subsidiary (A) in any Subsidiary; , provided that the aggregate outstanding amount of such Investments made by Loan Parties after the Effective Date in Restricted Subsidiaries that are not Loan Parties in reliance on this clause (ciii)(A) (including any such Investments deemed to be made pursuant to Section 6.14(b) but without duplication of amounts made in reliance on Section 6.04(m)) (together with the amount of Investments made in Subsidiaries that are not Loan Parties made pursuant to Section 6.04(h) but exclusive of Short-Term Intercompany Debt), shall not exceed the greater Non-Loan Party Investment Amount at the time of $10,000,000 any such Investment, (B) in any Subsidiary that is not a Loan Party, constituting an exchange of Equity Interests of such Subsidiary for Indebtedness of such Subsidiary or (C) constituting Guarantees of Indebtedness or other monetary obligations of Subsidiaries that are not Loan Parties owing to any Loan Party, (iv) by Holdings or any Subsidiary in Subsidiaries that are not Loan Parties so long as such Investment is part of a series of simultaneous Investments by Subsidiaries in other Subsidiaries that result in the proceeds of the initial Investment being invested in one or more Loan Parties and 35% (v) by Holdings or any Subsidiary in any Subsidiary that is not a Loan Party, consisting of Consolidated EBITDAthe contribution of Equity Interests of any other Subsidiary that is not a Loan Party so long as the Equity Interests of the transferee Subsidiary is pledged to secure the Secured Obligations; provided that in no event shall any IP Subsidiary or Material Subsidiary cease to be a Loan Party pursuant to this clause (c) except as a result of a consolidation, merger or similar transaction in which the continuing or surviving Person is a Loan Party;
(d) Investments consisting of prepayments to suppliers in the ordinary course of business;
(e) Investments consisting of extensions of trade credit in the ordinary course of business;
(fe) Investments (i) existing or contemplated on the date hereof and set forth on Schedule 6.04(f6.04(e) and any modification, replacement, renewal, reinvestment or extension thereof and (ii) Investments existing on the date hereof by Holdings, the Borrower Holdings or any Restricted Subsidiary in the Borrower or any Restricted Subsidiary and any modification, renewal or extension thereof; provided that the amount of the original Investment is not increased except by the terms of such Investment to the extent as set forth on Schedule 6.04(f6.04(e) or as otherwise permitted by this Section 6.04;
(gf) Investments in Swap Agreements permitted under Section 6.01(a)(vi)6.07;
(hg) promissory notes and other non-cash noncash consideration received in connection with Dispositions permitted by Section 6.05;
(ih) Permitted Acquisitions;
(j) , provided that the Transactions;
(k) Investments in aggregate amount of consideration paid or provided by Holdings, the ordinary course of business consisting of endorsements for collection or deposit and customary trade arrangements with customers consistent with past practices;
(l) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers and customers, from financially troubled account debtors or in settlement of delinquent obligations of, or other disputes with, customers and suppliers or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment;
(m) loans and advances to Holdings (Borrower or any direct or indirect parent thereof) or any Intermediate Parent in lieu of, and not in excess of other Loan Party after the amount of (after giving effect to any other loans, advances or Restricted Payments in respect thereof), Restricted Payments to the extent permitted to be made to Holdings (or such parent) or such Intermediate Parent in accordance with Section 6.08(a);
(n) additional Investments and other acquisitions; provided that at the time any such Investment or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition made Effective Date in reliance on this clause Section 6.04(h) (n), together with the aggregate amount of all consideration paid in connection with all other any Investments and acquisitions made in reliance on this clause (n), shall not exceed the sum of (A) the greater of $18,000,000 and 60% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Investment or other acquisition, plus (B) so long as no Event of Default has occurred and is continuing, the Available Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of such Investment;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby;
(p) advances of payroll payments to employees in the ordinary course of business;
(q) Investments and other acquisitions to the extent that payment for such Investments is made with Qualified Equity Interests (excluding Cure Amounts) of Holdings (or any direct or indirect parent thereof or the IPO Entity); provided that (i) such amounts used pursuant to this clause (q) shall not increase the Available Amount and (ii) any amounts used for such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof or the IPO Entity) shall otherwise be permitted Loan Parties pursuant to this Section 6.04;
(r) Investments of a Subsidiary acquired after the Effective Date or of a Person merged or consolidated with any Subsidiary in accordance with this Section and Section 6.03 after the Effective Date to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger or consolidation and were in existence on the date of such acquisition, merger or consolidation;
(s) non-cash Investments in connection with tax planning and reorganization activities; provided that after giving effect to any such activities, the security interests of the Lenders in the Collateral, taken as a whole, would not be materially impaired;
(t) Investments consisting of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference to this Section 6.04(t)) under Sections 6.01, 6.02, 6.03, 6.05 and 6.08, respectively;
(u) additional Investments; provided that after giving effect to such Investment (A) on a Pro Forma Basis, the Total Net Leverage Ratio is less than or equal to 4.50 to 1.00 and (B) there is no continuing Event of Default;
(v) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the Borrower;
(w) to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Property, or other rights, in each case in the ordinary course of business;
(x) Investments by an Unrestricted Subsidiary entered into prior to the day such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to the definition of “Unrestricted Subsidiary”;
(y) Investments consisting of purchases of assets of Franchisees (including, but not limited to, area development contracts owned by Franchisees) in the ordinary course of business or otherwise in an amount not exceeding $60,000,000, so long as (A) no Event of Default shall have occurred and be continuing and (B) the Borrower is in pro forma compliance with the Financial Covenant after giving effect to any such purchase;
(z) So long as no Event of Default shall have occurred and be continuing, Investments in Franchisees (including, but not limited to, (i) Guarantees or other credit support of any Indebtedness and other liabilities thereof and (ii) loans, advances or contributions to the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater of $20,000,000 and 70% of Consolidated EBITDA;
(aa) Investments consisting of accounts and payment intangibles owing to the Borrower or any of the Restricted Subsidiaries from Franchisees; provided that such obligation shall be on such terms as the Borrower or the applicable Restricted Subsidiary establishes in good faith; and
(bb) Investments consisting of advances or expenditures by any Loan Party to, or on behalf of, any CMF Subsidiary in support of advertising and marketing programs in the ordinary course consistent with current practices. For purposes of determining compliance with this Section 6.04, in the event that any item of Investment meets the criteria of more than one of the categories of Investments described in clauses (a) through (bb) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such Investment (or any portion thereof) and will only be required to include the amount and type of such Investment in one or more of the above clauses.Section
Appears in 2 contracts
Samples: Credit Agreement (Skype S.a r.l.), Credit Agreement (Skype S.a r.l.)
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor the Borrower will, nor will they permit any Restricted Subsidiary or Intermediate Parent to, make or hold any Investment, except:
(a) Permitted Investments at the time such Permitted Investment is madeInvestments;
(b) loans or advances to current or former officers, directors and employees of Holdings, any Intermediate Parent, the Borrower Holdings and the its Restricted Subsidiaries (i) for reasonable and customary business-related travel, entertainment, relocation and analogous ordinary business purposes, (ii) in connection with such Person’s purchase of Equity Interests in of Holdings (or any direct or indirect parent thereof) (provided that the amount of such loans and advances made in cash to such Person shall be contributed to the Borrower in cash as common equity or Qualified Equity Interests) and (iii) for purposes not described in the foregoing clauses (i) and (ii); provided that at the time of incurrence thereof and after giving Pro Forma Effect thereto, the in an aggregate principal amount outstanding in reliance on this clause (iii) shall at any time not to exceed $1,000,0005,000,000;
(c) Investments (i) by Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary in any of Loan Party, (ii) by any Restricted Subsidiary that is not a Loan Party in any other Restricted Subsidiary that is also not a Loan Party, (iii) by Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary (A) in any Restricted Subsidiary; provided that the aggregate outstanding amount of such Investments made by Loan Parties after the Effective Date in Restricted Subsidiaries that are not Loan Parties in reliance on this clause (ciii)(A) (together with the amount of Investments made in Restricted Subsidiaries that are not Loan Parties pursuant to Sections 6.04(h) and 6.04(p)) shall not exceed the greater Non-Loan Party Investment Amount at the time of $10,000,000 any such Investment, (B) in any Restricted Subsidiary that is not a Loan Party, constituting an exchange of Equity Interests of such Restricted Subsidiary for Indebtedness of such Restricted Subsidiary or (C) constituting Guarantees of Indebtedness or other monetary obligations of Restricted Subsidiaries that are not Loan Parties owing to any Loan Party, (iv) by Holdings, the Borrower or any Restricted Subsidiary in Restricted Subsidiaries that are not Loan Parties so long as such Investment is part of a series of simultaneous Investments that result in the proceeds of the initial Investment being invested in one or more Loan Parties and 35% (v) by Holdings, the Borrower or any Restricted Subsidiary in any Restricted Subsidiary that is not a Loan Party, consisting of Consolidated EBITDAthe contribution of Equity Interests of any other Restricted Subsidiary that is not a Loan Party so long as the Equity Interests of the transferee Restricted Subsidiary is pledged to secure the Secured Obligations;
(d) Investments consisting of prepayments to suppliers extensions of trade credit and accommodation guarantees in the ordinary course of business;
(e) Investments consisting of extensions of trade credit in the ordinary course of business;
(f) Investments (i) existing or contemplated on the date hereof and set forth on Schedule 6.04(f6.04(e) and any modification, replacement, renewal, reinvestment or extension thereof and (ii) Investments existing on the date hereof by Holdings, the Borrower or any Restricted Subsidiary in the Borrower or any Restricted Subsidiary and any modification, renewal or extension thereof; provided that that, in each case, the amount of the original Investment is not increased except by the terms of such Investment to the extent as set forth on Schedule 6.04(f6.04(e) or as otherwise permitted by this Section 6.04;
(gf) Investments in Swap Agreements permitted under Section 6.01(a)(vi);
(hg) promissory notes and other non-cash consideration received in connection with Dispositions permitted by Section 6.05;
(ih) Permitted Acquisitions; provided that the aggregate amount of cash consideration paid or provided by the Borrower or any other Loan Party or any Restricted Subsidiary after the Effective Date in reliance on this Section 6.04(h) (together with any Investments made in Restricted Subsidiaries that are not Loan Parties pursuant to Sections 6.04(c)(iii)(A) and 6.04(p)) for Permitted Acquisitions (including the aggregate principal amount of all Indebtedness assumed in connection with Permitted Acquisitions) for any Restricted Subsidiary that shall not be or, after giving effect to such Permitted Acquisition, shall not become a Loan Party (or for assets that are not purchased by, or promptly contributed to, a Loan Party), shall not exceed the Non-Loan Party Investment Amount at such time;
(j) the Transactions;
(ki) Investments in the ordinary course of business consisting of Uniform Commercial Code Article 3 endorsements for collection or deposit and Uniform Commercial Code Article 4 customary trade arrangements with customers consistent with past practices;
(lj) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers and customers, from financially troubled account debtors customers or in settlement of delinquent obligations of, or other disputes with, customers and suppliers or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment;
(mk) loans and advances to Holdings (or any direct or indirect parent thereof) or any Intermediate Parent in lieu of, and not in excess of the amount of (after giving effect to any other loans, advances or Restricted Payments in respect thereof), Restricted Payments to the extent permitted to be made to Holdings (or such parent) or such Intermediate Parent in accordance with Section 6.08(a6.06(a)(iv), (v), (vii), or (ix);
(nl) additional so long as no Event of Default shall have occurred and be continuing or would immediately result therefrom, other Investments and other acquisitionsby the Borrower or any Restricted Subsidiary; provided that at the time any such Investment or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition all Investments made in reliance on this clause (n), together with the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (n), l) shall not exceed the sum of (A) the greater of $18,000,000 and 60% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Investment or other acquisition, plus (B) so long as no Event of Default has occurred and is continuing, the Available Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of at such Investmenttime;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby;
(pm) advances of payroll payments to employees in the ordinary course of business;
(qn) Investments and other acquisitions to the extent that payment for such Investments is made solely with Qualified Equity Interests (excluding Cure Amounts) of Holdings (or any direct or indirect parent thereof or the IPO Entitythereof); provided that (i) such amounts used pursuant to this clause (q) shall not increase the Available Amount and (ii) any amounts used for such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof or the IPO Entity) shall otherwise be permitted pursuant to this Section 6.04;
(ro) Investments of a Restricted Subsidiary acquired after the Effective Date or of a Person merged merged, amalgamated or consolidated with any Restricted Subsidiary in accordance with this Section and Section 6.03 after the Effective Date (other than existing Investments in Restricted Subsidiaries of such Restricted Subsidiary or Person, which must comply with the requirements of Section 6.04(h) or 6.04(l)) to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger merger, amalgamation or consolidation and were in existence on the date of such acquisition, merger merger, amalgamation or consolidation;
(sp) acquisitions of, investments in, and loans and advances to, joint ventures and Unrestricted Subsidiaries by the Borrower and its Restricted Subsidiaries, so long as the aggregate amount invested, loaned or advanced pursuant to this Section 6.04(p) (determined without regard to any write-downs or write-offs of such investments, loans or advances), together with any Investments made in Restricted Subsidiaries that are not Loan Parties pursuant to Sections 6.04(c)(iii)(A) and 6.04(h), does not exceed the Non-Loan Party Investment Amount at such time;
(q) non-cash Investments in connection with tax planning and reorganization activities; provided that that, in the reasonable judgment of the Administrative Agent (following consultation with the Borrower), after giving effect to any such activities, the security interests of the Lenders in the Collateral, taken as a whole, would not be materially impaired; and
(r) Investments (A) for utilities, security deposits, leases and similar prepaid expenses incurred in the ordinary course of business and (B) trade accounts created, or prepaid expenses accrued, in the ordinary course of business.
(s) the licensing, sublicensing or contribution of rights in any Intellectual Property pursuant to joint marketing arrangements with Persons other than Holdings and its Restricted Subsidiaries in the ordinary course of business;
(t) Investments consisting to the extent that payment for such Investments is made solely by the issuance of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted Equity Interests (other than by reference Disqualified Equity Interests) of Holdings (or any direct or indirect parent of Holdings) to this Section 6.04(t)) under Sections 6.01, 6.02, 6.03, 6.05 and 6.08, respectivelythe seller of such Investments;
(u) additional Investments; provided any Investments in a Subsidiary that after giving effect is not a Loan Party or in a joint venture, in each case, to the extent such Investment (A) on is contemporaneously repaid in full with a Pro Forma Basis, the Total Net Leverage Ratio is less than dividend or equal to 4.50 to 1.00 and (B) there is no continuing Event of Defaultother distribution from such Subsidiary or joint venture;
(v) contributions the forgiveness or conversion to Equity Interests of any Indebtedness owed by a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the BorrowerLoan Party and permitted by Section 6.02;
(w) Restricted Subsidiaries of Borrower may be established or created if the Borrower and such Restricted Subsidiary comply with the requirements of Section 5.11, if applicable; provided that, in each case, to the extent such new Restricted Subsidiary is created solely for the purpose of consummating an acquisition permitted by this Section 6.04, and such new Restricted Subsidiary at no time holds any assets or liabilities other than any merger consideration contributed to it contemporaneously with the closing of such transactions, such new Restricted Subsidiary shall not be required to take the actions set forth in Section 5.11, as applicable, until the respective acquisition is consummated (at which time the surviving entity of the respective transaction shall be required to so comply in accordance with the provisions thereof);
(x) to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials or and equipment or purchases, acquisitions, purchases of contract rights or licenses or leases of other assets, Intellectual Property, or other rightsintellectual property, in each case in the ordinary course of business;
(xy) Investments by an Unrestricted Subsidiary entered into prior to received substantially contemporaneously in exchange for, or the day payment of which is made with, Equity Interests of the Borrower; provided that (i) no Change in Control would result therefrom, and (ii) such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to the definition of “Unrestricted Subsidiary”Equity Interests do not constitute Disqualified Equity Interests;
(yz) Investments consisting Guarantees by (i) the Borrower or any Subsidiary Loan Party of purchases operating leases (other than Capital Lease Obligations) or of assets of Franchisees (includingother obligations that do not constitute Indebtedness, but not limited toin each case, area development contracts owned entered into by Franchisees) the Borrower or any Subsidiary Loan Party in the ordinary course of business or otherwise in an amount not exceeding $60,000,000, so long as (A) no Event of Default shall have occurred and be continuing and (B) the Borrower is in pro forma compliance with the Financial Covenant after giving effect to any such purchase;
(z) So long as no Event of Default shall have occurred and be continuing, Investments in Franchisees (including, but not limited to, (i) Guarantees or other credit support of any Indebtedness and other liabilities thereof and (ii) loansany Subsidiary that is not a Loan Party of operating leases (other than Capital Lease Obligations) or of obligations that do not constitute Indebtedness, advances or contributions to in each case, entered into by any Subsidiary that is not a Loan Party in the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater ordinary course of $20,000,000 and 70% of Consolidated EBITDAbusiness;
(aa) Investments consisting of accounts and payment intangibles owing to the Borrower or any of the Restricted Subsidiaries from Franchisees; provided that such obligation shall be on such terms as the Borrower or the applicable Restricted Subsidiary establishes in good faith; and[reserved];
(bb) Investments consisting of advances or expenditures by Loan Parties in any Restricted Subsidiary that is not a Loan Party to, or on behalf of, any CMF Subsidiary so long as such Investment is part of a series of simultaneous Investments by the Borrower and the Restricted Subsidiaries in support of advertising and marketing programs other Restricted Subsidiaries that result in the ordinary course consistent with current practices. For purposes of determining compliance with this Section 6.04, in the event that any item of Investment meets the criteria of more than one proceeds of the categories of Investments described in clauses (a) through (bb) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such intercompany Investment (or any portion thereof) and will only be required to include the amount and type of such Investment being invested in one or more Loan Parties; and
(cc) other Investments (including acquisitions) by Holdings or any Restricted Subsidiary not to exceed, in the aggregate, at any time outstanding, the greater of (x) $10,000,000 and (y) 20% of Consolidated EBITDA for the above clausesmost recently ended LTM Period (as determined at the time of such Investment).
Appears in 2 contracts
Samples: Credit Agreement (TA Holdings 1, Inc.), Credit Agreement (TA Holdings 1, Inc.)
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor the The Borrower willwill not, nor will they it permit any Restricted Subsidiary or Intermediate Parent to, make or hold any Investment, except:
(a) Permitted Investments at the time such Permitted Investment is made;
(b) loans or advances to officers, directors and employees of Holdings, any Intermediate Parent, the Borrower and the Restricted Subsidiaries (i) for reasonable and customary business-related travel, entertainment, relocation and analogous ordinary business purposes, (ii) in connection with such Person’s purchase of Equity Interests in Holdings the Borrower (or any direct or indirect parent thereof) (provided that the amount of such loans and advances made in cash to such Person shall be contributed to by the Borrower in cash as common equity or Qualified Equity Interests) and (iii) for purposes not described in the foregoing clauses (i) and (ii); provided that at the time of incurrence thereof and after giving Pro Forma Effect thereto, the aggregate principal amount outstanding in reliance on this clause (iii) shall not to exceed $1,000,00010,000,000;
(c) Investments (i) by Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary in any of HoldingsLoan Party, (ii) by any Intermediate ParentRestricted Subsidiary that is not a Loan Party in any other Restricted Subsidiary that is also not a Loan Party, (iii) by the Borrower or any Restricted Subsidiary (A) in any Restricted Subsidiary; provided that (i) the aggregate outstanding amount of such Investments made by Loan Parties after the Effective Date in Restricted Subsidiaries that are not Loan Parties in reliance on this clause (ciii)(A) shall not exceed exceed, at the time of incurrence thereof and after giving Pro Forma Effect thereto, the greater of $10,000,000 and 3512.5% of Consolidated EBITDAEBITDA and $20,000,000 and (ii) no Event of Default has occurred and is continuing, (B) in any Restricted Subsidiary that is not a Loan Party, constituting an exchange of Equity Interests of such Restricted Subsidiary for Indebtedness of such Subsidiary or (C) constituting Guarantees of Indebtedness or other monetary obligations of Restricted Subsidiaries that are not Loan Parties owing to any Loan Party, (iv) by the Borrower or any Restricted Subsidiary in Restricted Subsidiaries that are not Loan Parties so long as such transactions is part of a series of simultaneous transactions that result in the proceeds of the initial Investment being invested in one or more Loan Parties (or, if the initial proceeds were held at a Restricted Subsidiary that is not a Loan Party, a Restricted Subsidiary that is not a Loan Party) and (v) by the Borrower or any Restricted Subsidiary in any Restricted Subsidiary that is not a Loan Party, consisting of the contribution of Equity Interests of any other Restricted Subsidiary that is not a Loan Party so long as the Equity Interests of the transferee Restricted Subsidiary is pledged to secure the Secured Obligations;
(d) Investments consisting of prepayments to suppliers in the ordinary course of business;
(e) Investments consisting of extensions of trade credit in the ordinary course of business;
(f) Investments (i) existing or contemplated on the date hereof and set forth on Schedule 6.04(f) and any modification, replacement, renewal, reinvestment or extension thereof and (ii) Investments existing on the date hereof by Holdings, the Borrower or any Restricted Subsidiary in the Borrower or any Restricted Subsidiary and any modification, renewal or extension thereof; provided that the amount of the original Investment is not increased except by the terms of such Investment to the extent as set forth on Schedule 6.04(f) or as otherwise permitted by this Section 6.04;
(g) Investments in Swap Agreements permitted under Section 6.01(a)(vi)6.01;
(h) promissory notes and other non-cash consideration received in connection with Dispositions permitted by Section 6.05;
(i) Permitted Acquisitions;
(j) the Transactions;
(k) Investments in the ordinary course of business consisting of endorsements for collection or deposit and customary trade arrangements with customers consistent with past practices;
(l) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers and customers, from financially troubled account debtors or in settlement of delinquent obligations of, or other disputes with, customers and suppliers or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment;
(m) loans and advances to Holdings (or any direct or indirect parent thereof) or any Intermediate Parent in lieu of, and not in excess of the amount of (after giving effect to any other loans, advances or Restricted Payments in respect thereof), Restricted Payments to the extent permitted to be made to Holdings (or such parent) or such Intermediate Parent in accordance with Section 6.08(a);
(n) additional Investments and other acquisitions; provided that at the time any such Investment or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition made in reliance on this clause (n), together with the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (n), shall not exceed the sum of (A) the greater of $18,000,000 and 60% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Investment or other acquisition, plus (B) so long as no Event of Default has occurred and is continuing, the Available Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of such Investment;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby;
(p) advances of payroll payments to employees in the ordinary course of business;
(q) Investments and other acquisitions to the extent that payment for such Investments is made with Qualified Equity Interests (excluding Cure Amounts) of Holdings (or any direct or indirect parent thereof or the IPO Entity); provided that (i) such amounts used pursuant to this clause (q) shall not increase the Available Amount and (ii) any amounts used for such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof or the IPO Entity) shall otherwise be permitted pursuant to this Section 6.04;
(r) Investments of a Subsidiary acquired after the Effective Date or of a Person merged or consolidated with any Subsidiary in accordance with this Section and Section 6.03 after the Effective Date to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger or consolidation and were in existence on the date of such acquisition, merger or consolidation;
(s) non-cash Investments in connection with tax planning and reorganization activities; provided that after giving effect to any such activities, the security interests of the Lenders in the Collateral, taken as a whole, would not be materially impaired;
(t) Investments consisting of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference to this Section 6.04(t)) under Sections 6.01, 6.02, 6.03, 6.05 and 6.08, respectively;
(u) additional Investments; provided that after giving effect to such Investment (A) on a Pro Forma Basis, the Total Net Leverage Ratio is less than or equal to 4.50 to 1.00 and (B) there is no continuing Event of Default;
(v) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the Borrower;
(w) to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Property, or other rights, in each case in the ordinary course of business;
(x) Investments by an Unrestricted Subsidiary entered into prior to the day such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to the definition of “Unrestricted Subsidiary”;
(y) Investments consisting of purchases of assets of Franchisees (including, but not limited to, area development contracts owned by Franchisees) in the ordinary course of business or otherwise in an amount not exceeding $60,000,000, so long as (A) no Event of Default shall have occurred and be continuing and (B) the Borrower is in pro forma compliance with the Financial Covenant after giving effect to any such purchase;
(z) So long as no Event of Default shall have occurred and be continuing, Investments in Franchisees (including, but not limited to, (i) Guarantees or other credit support of any Indebtedness and other liabilities thereof and (ii) loans, advances or contributions to the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater of $20,000,000 and 70% of Consolidated EBITDA;
(aa) Investments consisting of accounts and payment intangibles owing to the Borrower or any of the Restricted Subsidiaries from Franchisees; provided that such obligation shall be on such terms as the Borrower or the applicable Restricted Subsidiary establishes in good faith; and
(bb) Investments consisting of advances or expenditures by any Loan Party to, or on behalf of, any CMF Subsidiary in support of advertising and marketing programs in the ordinary course consistent with current practices. For purposes of determining compliance with this Section 6.04, in the event that any item of Investment meets the criteria of more than one of the categories of Investments described in clauses (a) through (bb) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such Investment (or any portion thereof) and will only be required to include the amount and type of such Investment in one or more of the above clauses.
Appears in 2 contracts
Samples: Abl Credit Agreement (Chewy, Inc.), Abl Credit Agreement (Chewy, Inc.)
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor the The Borrower willwill not, nor and will they not permit any Restricted Subsidiary or Intermediate Parent to, make or hold any Investment, except:
(a) Permitted Investments at the time such Permitted Investment is madeInvestments;
(b) loans or advances to officers, directors and employees of Holdings, any Intermediate Parent, the Borrower and the its Restricted Subsidiaries (i) for reasonable and customary business-related travel, entertainment, relocation and analogous ordinary business purposes, (ii) in connection with such Person’s purchase of Equity Interests in of Holdings (or any direct or indirect parent thereof) (provided that the amount of such loans and advances made in cash to such Person shall be contributed to the Borrower in cash as common equity or Qualified Equity Interests) ), and (iii) for purposes not described in the foregoing clauses (i) and (ii); , provided that at the time of incurrence thereof and after giving Pro Forma Effect thereto, the aggregate principal amount outstanding in reliance on at any time under this clause (iiib) shall not to exceed $1,000,0003,500,000;
(c) Investments (i) by Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary in any of HoldingsLoan Party (excluding any new Restricted Subsidiary that becomes a Loan Party pursuant to such Investment), (ii) by any Intermediate ParentRestricted Subsidiary that is not a Loan Party in any other Restricted Subsidiary that is also not a Loan Party, (iii) by the Borrower or any Restricted Subsidiary (A) in any Restricted Subsidiary; provided that the aggregate outstanding amount of such Investments made by Loan Parties after the Effective Date in Restricted Subsidiaries that are not Loan Parties in reliance on this clause (ciii)(A) (together with the amount of Investments made in Restricted Subsidiaries that are not Loan Parties pursuant to Section 6.04(h)) shall not exceed the greater Non-Loan Party Investment Amount at the time of $10,000,000 any such Investment, (B) in any Restricted Subsidiary that is not a Loan Party, constituting an exchange of Equity Interests of such Restricted Subsidiary for Indebtedness of such Subsidiary or (C) constituting Guarantees of Indebtedness or other monetary obligations of Restricted Subsidiaries that are not Loan Parties owing to any Loan Party, (iv) by the Borrower or any Restricted Subsidiary in Restricted Subsidiaries that are not Loan Parties so long as such Investment is part of a series of simultaneous Investments that result in the proceeds of the initial Investment being invested in one or more Loan Parties and 35% (v) by the Borrower or any Restricted Subsidiary in any Restricted Subsidiary that is not a Loan Party, consisting of Consolidated EBITDAthe contribution of Equity Interests of any other Restricted Subsidiary that is not a Loan Party so long as the Equity Interests of the transferee Restricted Subsidiary is pledged to secure the Secured Obligations;
(d) Investments consisting of prepayments to suppliers extensions of trade credit and accommodation guarantees in the ordinary course of business;
(e) Investments consisting of extensions of trade credit in the ordinary course of business;
(f) Investments (i) existing or contemplated on the date hereof Effective Date and set forth on Schedule 6.04(f6.04(e) and any modification, replacement, renewal, reinvestment or extension thereof and (ii) Investments existing on the date hereof Effective Date by Holdings, the Borrower or any Restricted Subsidiary in the Borrower or any Restricted Subsidiary and any modification, renewal or extension thereof; provided that the amount of the original Investment is not increased except by the terms of such Investment to the extent as set forth on Schedule 6.04(f6.04(e) or as otherwise permitted by this Section 6.04;
(gf) Investments in Swap Agreements permitted under Section 6.01(a)(vi)incurred in the ordinary course of business and not for speculative purposes;
(hg) promissory notes and other non-cash consideration received in connection with Dispositions permitted by Section 6.05;
(ih) Permitted Acquisitions; provided that the aggregate amount of consideration paid or provided by the Borrower or any other Loan Party after the Effective Date in reliance on this Section 6.04(h) (together with any Investments made in Subsidiaries that are not Loan Parties pursuant to Section 6.04(c)(iii)(A)) for Permitted Acquisitions (including the aggregate principal amount of all Indebtedness assumed in connection with Permitted Acquisitions) for any Restricted Subsidiary that shall not be or, after giving effect to such Permitted Acquisition, shall not become a Loan Party, shall not exceed the Non-Loan Party Investment Amount at such time;
(ji) the Transactions;
(kj) Investments in the ordinary course of business consisting of Uniform Commercial Code Article 3 endorsements for collection or deposit and Uniform Commercial Code Article 4 customary trade arrangements with customers consistent with past practices;
(lk) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers and customers, from financially troubled account debtors customers or in settlement of delinquent obligations of, or other disputes with, customers and suppliers or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment;
(ml) loans and advances to Holdings (or any direct or indirect parent thereof) or any Intermediate Parent in lieu of, and not in excess of the amount of (after giving effect to any other loans, advances or Restricted Payments in respect thereof), ) Restricted Payments to the extent permitted to be made to Holdings (or such parent) or such Intermediate Parent in accordance with Section 6.08(a6.08(a)(iv), (v), (vi), (vii) or (viii);
(nm) additional other Investments and other acquisitions; provided that (i) so long as immediately after giving effect to any such Investment no Default has occurred and is continuing, (ii) at the time any such Investment or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition all Investments made in reliance on this clause (nm) (including all such Investments deemed made pursuant to clause (c) of the definition of “Non-Loan Party Investment Amount”), together with the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (nm) (including the aggregate principal amount of all Indebtedness assumed in connection with any such other acquisition), shall not exceed the sum of $125,000,000, and (A) the greater of $18,000,000 and 60% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Investment or other acquisition, plus (Biii) so long as no Event the Borrower shall be in compliance with the Financial Performance Covenant on a Pro Forma Basis as of Default has occurred and the end of the most recent Test Period (regardless of whether such Financial Performance Test is continuingapplicable at such time), such amount shall be increased by the Available Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of such InvestmentAmount;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby;
(pn) advances of payroll payments to employees in the ordinary course of business;
(qo) Investments and other acquisitions in Foreign Subsidiaries to the extent that payment for such Investments is made with Qualified Equity Interests (excluding Cure Amounts) necessary to consummate the acquisition of GTV Holdings (or any direct or indirect parent thereof or the IPO Entity); provided that (i) such amounts used Pty Ltd., pursuant to this clause (q) shall not increase the Available Amount Share Sale and (ii) any amounts used for such an Purchase Agreement dated December 17, 2013 by and among NEP Group Pty Ltd, each seller party thereto and Catalyst Investment or other acquisition that are not Qualified Equity Interests Managers Pty Ltd and the payment of Holdings (or any direct or indirect parent thereof or the IPO Entity) shall otherwise be permitted pursuant to this Section 6.04fees and expenses related thereto;
(rp) Investments of a Subsidiary acquired after the Effective Date or of a Person merged or consolidated with any Subsidiary in accordance with this Section and Section 6.03 after the Effective Date or that otherwise becomes a Subsidiary (provided that if such Investment is made under Section 6.04(h), existing Investments in subsidiaries of such Subsidiary or Person shall comply with the requirements of Section 6.04(h), 6.04(m) or any other paragraph of this Section 6.04) to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger or consolidation and were in existence on the date of such acquisition, merger or consolidation;
(sq) non-cash Investments in connection with tax planning and reorganization activities; provided that after giving effect to any such activities, the security interests of the Lenders in the Collateral, taken as a whole, would not be materially impaired;
(t) Investments consisting of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference to this Section 6.04(t)) under Sections 6.01, 6.02, 6.03, 6.05 and 6.08, respectively;
(u) additional Investments; provided that after giving effect to such Investment (A) on a Pro Forma Basis, the Total Net Leverage Ratio is less than or equal to 4.50 to 1.00 and (B) there is no continuing Event of Default;
(v) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the Borrower;
(w) receivables owing to the extent that they constitute InvestmentsBorrower or any Restricted Subsidiary, purchases and acquisitions of inventory, supplies, materials if created or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Property, or other rights, in each case acquired in the ordinary course of business;; and
(xr) Investments by an Unrestricted Subsidiary entered into prior to the day such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to the definition of “Unrestricted Subsidiary”;
for (yA) Investments consisting of purchases of assets of Franchisees (includingutilities, but not limited tosecurity deposits, area development contracts owned by Franchisees) leases and similar prepaid expenses incurred in the ordinary course of business or otherwise in an amount not exceeding $60,000,000, so long as (A) no Event of Default shall have occurred and be continuing and (B) the Borrower is in pro forma compliance with the Financial Covenant after giving effect to any such purchase;
(z) So long as no Event of Default shall have occurred and be continuing, Investments in Franchisees (including, but not limited to, (i) Guarantees or other credit support of any Indebtedness and other liabilities thereof and (ii) loans, advances or contributions to the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater of $20,000,000 and 70% of Consolidated EBITDA;
(aa) Investments consisting of trade accounts and payment intangibles owing to the Borrower or any of the Restricted Subsidiaries from Franchisees; provided that such obligation shall be on such terms as the Borrower or the applicable Restricted Subsidiary establishes in good faith; and
(bb) Investments consisting of advances or expenditures by any Loan Party tocreated, or on behalf ofprepaid expenses accrued, any CMF Subsidiary in support of advertising and marketing programs in the ordinary course consistent with current practices. For purposes of determining compliance with this Section 6.04, in the event that any item of Investment meets the criteria of more than one of the categories of Investments described in clauses (a) through (bb) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such Investment (or any portion thereof) and will only be required to include the amount and type of such Investment in one or more of the above clausesbusiness.
Appears in 2 contracts
Samples: First Lien Credit Agreement (NEP Group, Inc.), First Lien Credit Agreement (NEP Group, Inc.)
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings Holdings, the Company nor the any Borrower will, nor will they permit any Restricted Subsidiary or Intermediate Parent to, make or hold any Investment, except:
(a) Permitted Investments at the time such Permitted Investment is made;
(b) loans or advances to officers, directors and employees of Holdings, any Intermediate Parentthe Company, the Borrower Borrowers and the Restricted Subsidiaries (i) for reasonable and customary business-related travel, entertainment, relocation and analogous ordinary business purposes, (ii) in connection with such Person’s purchase of Equity Interests in Holdings (or any direct or indirect parent thereof) (provided that the amount of such loans and advances made in cash to such Person shall be contributed to the Company or a Borrower in cash as common equity or Qualified Equity Interests) and (iii) for purposes not described in the foregoing clauses (i) and (ii); provided that at the time of incurrence thereof and after giving Pro Forma Effect thereto, the aggregate principal amount outstanding in reliance on this clause (iii) shall not exceed $1,000,000250,000,000;
(c) Investments by Holdings, any Intermediate Parent, the Company, any Borrower or any Restricted Subsidiary in any of Holdings, any Intermediate Parent, the Company, any Borrower or any Restricted Subsidiary; provided that, in the case of any Investment by a Loan Party in a Restricted Subsidiary that the aggregate outstanding amount is not a Loan Party, no Event of Investments made by Loan Parties in Restricted Subsidiaries that are not Loan Parties in reliance on this clause (c) Default shall not exceed the greater of $10,000,000 have occurred and 35% of Consolidated EBITDAbe continuing or would result therefrom;
(d) Investments consisting of prepayments to suppliers in the ordinary course of business;
(e) Investments consisting of extensions of trade credit in the ordinary course of business;
(f) Investments (i) existing or contemplated on the date hereof and set forth on Schedule 6.04(f) and any modification, replacement, renewal, reinvestment or extension thereof and (ii) Investments existing on the date hereof by Holdings, the Company, any Borrower or any Restricted Subsidiary in the Company, any Borrower or any Restricted Subsidiary and any modification, renewal or extension thereof; provided that the amount of the original Investment is not increased except by the terms of such Investment to the extent as set forth on Schedule 6.04(f) or as otherwise permitted by this Section 6.04;
(g) Investments in Swap Agreements permitted under Section 6.01(a)(vi)6.01;
(h) promissory notes and other non-cash consideration received in connection with Dispositions permitted by Section 6.05;
(i) Permitted Acquisitions;
(j) the Transactions (including, without limitation, (i) the designation of the Grandfathered Unrestricted Subsidiaries and (ii) the contribution of VMware common stock contemplated in the definition of “Grandfathered Unrestricted Subsidiaries”) and the Original Transactions;
(k) Investments in the ordinary course of business consisting of endorsements for collection or deposit and customary trade arrangements with customers consistent with past practices;
(l) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers and customers, from financially troubled account debtors or in settlement of delinquent obligations of, or other disputes with, customers and suppliers or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment;
(m) loans and advances to Holdings (or any direct or indirect parent thereof) or any Intermediate Parent in lieu of, and not in excess of the amount of (after giving effect to any other loans, advances or Restricted Payments in respect thereof), Restricted Payments to the extent permitted to be made to Holdings (or such parent) or such Intermediate Parent in accordance with Section 6.08(a);
(n) additional other Investments and other acquisitions; provided that at the time any such Investment or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition all Investments made in reliance on this clause (n), ) together with the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (n) (including the aggregate principal amount of all Indebtedness assumed in connection with any such other acquisition), shall not exceed the sum of (A) the greater of $18,000,000 3,750,000,000 and 6037.5% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Investment or other acquisition, plus (B) so long as immediately after giving effect to any such Investment no Event of Default under Section 7.01(a), (b), (h) or (i) has occurred and is continuing, the Available Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of such Investment, plus (C) the Available Equity Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of such Investment;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby;
(p) advances of payroll payments to employees in the ordinary course of business;
(qp) Investments and other acquisitions to the extent that payment for such Investments is made with Qualified Equity Interests (excluding Cure Amounts) of Holdings (or any direct or indirect parent thereof or the IPO Entitythereof); provided that (i) such amounts used pursuant to this clause (qp) shall not increase the Available Equity Amount or be applied to increase any other basket hereunder and (ii) any amounts used for such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof or the IPO Entitythereof) shall otherwise be permitted pursuant to this Section 6.04;
(rq) Investments of a Subsidiary acquired after the Effective Date or of a Person merged or consolidated with any Subsidiary in accordance with this Section and Section 6.03 after the Effective Date to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger or consolidation and were in existence on the date of such acquisition, merger or consolidation;
(sr) non-cash Investments in connection with tax planning and reorganization activities; provided that after giving effect to any such activities, the security interests of the Lenders in the Collateral, taken as a whole, would not be materially impaired;
(ts) Investments consisting of Liens, Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference to this Section 6.04(t6.04(s)) under Sections Section 6.01, 6.02, 6.03, 6.05 and 6.08, respectively, in each case, other than by reference to this Section 6.04(s);
(ut) additional Investments; provided that after giving effect to such Investment (A) on a Pro Forma Basis, the Total Net Leverage Ratio is less than or equal to 4.50 to 1.00 1.0 and (B) there is no continuing Event of Default;
(vu) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings the Company or the a Borrower;
(wv) to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Propertyintellectual property, or other rights, in each case in the ordinary course of business;
(w) Investments in Subsidiaries in the form of DFS Financing Assets, other receivables and related assets required in connection with a Permitted Receivables Financing (including the contribution or lending of cash and cash equivalents to Subsidiaries to finance the purchase of such assets from the Company, any Borrower or other Restricted Subsidiaries or to otherwise fund required reserves);
(x) DFS Financing Assets originated by the Company, any Borrower and/or the Subsidiaries;
(y) Investments by an Unrestricted Subsidiary entered into prior to the day such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to the definition of “Unrestricted Subsidiary”;
(yz) any Investment in a Similar Business; provided that at the time any such Investment is made, the aggregate outstanding amount of all Investments consisting made in reliance on this clause (z) together with the aggregate amount of purchases all consideration paid in connection with all other acquisitions made in reliance on this clause (z), shall not exceed the greater of assets of Franchisees (including, but not limited to, area development contracts owned by Franchisees) in the ordinary course of business or otherwise in an amount not exceeding $60,000,000, so long as (A) no Event of Default shall have occurred and be continuing $2,500,000,000 and (B) the Borrower is in pro forma compliance with the Financial Covenant after giving effect to any such purchase;
(z) So long as no Event of Default shall have occurred and be continuing, Investments in Franchisees (including, but not limited to, (i) Guarantees or other credit support of any Indebtedness and other liabilities thereof and (ii) loans, advances or contributions to the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater of $20,000,000 and 7025% of Consolidated EBITDA;EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Investment; and
(aa) Investments consisting of accounts and payment intangibles owing to the Borrower or any of the Restricted Subsidiaries from Franchiseesin Unrestricted Subsidiaries; provided that at the time any such obligation Investment is made, the aggregate outstanding amount of all Investments made in reliance on this clause (aa) together with the aggregate amount of all consideration paid in connection with all other acquisitions made in reliance on this clause (aa), shall be on not exceed the greater of (A) $1,250,000,000 and (B) 12.5% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such terms as the Borrower or the applicable Restricted Subsidiary establishes in good faith; and
(bb) Investments consisting of advances or expenditures by any Loan Party to, or on behalf of, any CMF Subsidiary in support of advertising and marketing programs in the ordinary course consistent with current practicesInvestment. For purposes of determining compliance with this Section 6.04, in the event that any item of a proposed Investment (or portion thereof) meets the criteria of more than one of the categories of Investments described in clauses (a) through (bbaa) above, Holdings shall, in its sole discretion, the Borrowers will be entitled to classify and reclassify or later divide, classify or reclassify (based on circumstances existing on the date of such reclassification) such Investment (or any portion thereof) and will only be required to include the amount and type of between such Investment clauses (a) through (aa), in one or more of the above clausesa manner that otherwise complies with this Section 6.04.
Appears in 2 contracts
Samples: Credit Agreement, Credit Agreement (Dell Technologies Inc)
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor the Borrower No Loan Party will, nor will they it permit any Restricted Subsidiary or Intermediate Parent to, make or hold maintain any Investment, exceptInvestments other than:
(a) Permitted Investments at existing on the time such Permitted Investment is madedate hereof in or to Subsidiaries and set forth on Schedule 6.04 and any extensions or amendments thereto not increasing the principal or capital amount thereof;
(b) Cash Equivalents;
(c) Capital Expenditures and Capitalized Software Expenditures;
(d) normal trade credit extended in the ordinary course of business and consistent with prudent business practice;
(e) advances or loans or advances to officers, directors and or employees of Holdingsthe Borrower or its Subsidiaries for business related, education, entertainment, travel or moving expenses to be incurred in the ordinary course of business in an amount not to exceed the greater of (x) $1,000,000 and (y) 2.0% of Consolidated EBITDA as of the last day of the most recently ended Reference Period for which Financial Statements are available, in the aggregate outstanding at any Intermediate Parent, one time,
(f) Investments by the Borrower and the Restricted Subsidiaries in Equity Interests in, or capital or asset contributions to, their respective Subsidiaries; provided, that (i) for reasonable any such Equity Interests held by a Loan Party shall be pledged pursuant to a Collateral Document to the extent required thereby (subject to the limitations and customary business-related travel, entertainment, relocation exceptions set forth in the applicable Collateral Document) and analogous ordinary business purposes, (ii) the aggregate amount of Investments by Loan Parties in connection Subsidiaries that are not Loan Parties (together with such Person’s purchase outstanding intercompany loans to Subsidiaries that are not Loan Parties permitted under Section 6.04(g) and outstanding Guarantees of Equity Interests Indebtedness of Subsidiaries that are not Loan Parties permitted under Section 6.04(h)) shall not exceed in Holdings the aggregate at any time outstanding, the greater of (x) $15,000,000 and (y) 25% of Consolidated EBITDA as of the last day of the most recently ended Reference Period for which Financial Statements are available;
(g) loans or advances made by the Borrower to any Subsidiary and made by any Subsidiary to the Borrower or any direct or indirect parent thereofother Subsidiary; provided, that, (i) any such loans and advances made by a Loan Party shall be evidenced by a promissory note (provided that which may be a global note) pledged pursuant to a Collateral Document and (ii) the amount of such loans and advances made in cash to such Person shall be contributed to the Borrower in cash as common equity or Qualified Equity Interests) and (iii) for purposes not described in the foregoing clauses (i) and (ii); provided that at the time of incurrence thereof and after giving Pro Forma Effect thereto, the aggregate principal amount outstanding in reliance on this clause (iii) shall not exceed $1,000,000;
(c) Investments by Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary in any of Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary; provided that the aggregate outstanding amount of Investments made by Loan Parties in Restricted to Subsidiaries that are not Loan Parties (together with outstanding Investments in reliance on this clause (cSubsidiaries that are not Loan Parties permitted under Section 6.04(f) and outstanding Guarantees of Indebtedness of Subsidiaries that are not Loan Parties permitted under Section 6.04(h)) shall not exceed in the aggregate at any time outstanding, the greater of (x) $10,000,000 15,000,000 and 35(y) 25% of Consolidated EBITDAEBITDA as of the last day of the most recently ended Reference Period for which Financial Statements are available;
(dh) Guarantees constituting Indebtedness permitted by Section 6.01; provided, that the aggregate principal amount of Indebtedness of Subsidiaries that are not Loan Parties that is Guaranteed by any Loan Party shall (together with outstanding Investments in Subsidiary that are not Loan Parties permitted under Section 6.04(f) and outstanding intercompany loans to Subsidiaries that are not Loan Parties permitted under Section 6.04(g)) shall not exceed, in the aggregate at any time outstanding, the greater of (x) $15,000,000 and (y) 25% of Consolidated EBITDA as of the last day of the most recently ended Reference Period for which Financial Statements are available;
(i) Loans or advances made by the Borrower or any Subsidiary to any Person (including employees) not in the ordinary course of business not to exceed the greater of (x) $1,000,000 and (y) 2% of Consolidated EBITDA as of the last day of the most recently ended Reference Period for which Financial Statements are available, in the aggregate outstanding at any one time;
(j) Permitted Acquisitions;
(k) Investments in cash and Cash Equivalents and obligations under Swap Agreements permitted by Section 6.05;
(l) Investments consisting of prepayments to suppliers security deposits with utilities and other like Persons made in the ordinary course of business;
(em) Investments consisting received in connection with any insolvency proceedings in respect of extensions any customers, suppliers or clients and in settlement of trade credit in the ordinary course of businessdelinquent obligations of, and other disputes with, customers, suppliers or clients;
(fn) Investments (i) of any Person existing at the time such Person becomes a Subsidiary or contemplated on the date hereof and set forth on Schedule 6.04(f) and any modificationconsolidates, replacement, renewal, reinvestment amalgamates or extension thereof and (ii) Investments existing on the date hereof by Holdings, merges with the Borrower or any Restricted Subsidiary (including in connection with an Acquisition or other Investment permitted hereunder); provided that such Investment was not made in contemplation of such Person becoming a Subsidiary or such consolidation, amalgamation or merger;
(o) upon foreclosure (or transfer of title in lieu of foreclosure) with respect to any secured Investment in a Person other than the Borrower or any Restricted a Subsidiary and any modificationthat, renewal or extension thereof; provided that the amount of the original Investment is not increased except by the terms in each case, was made without contemplation of such Investment to the extent as set forth on Schedule 6.04(f) foreclosure (or as otherwise permitted by this Section 6.04;
(g) Investments transfer of title in Swap Agreements permitted under Section 6.01(a)(vilieu of foreclosure);
(h) promissory notes and other non-cash consideration received in connection with Dispositions permitted by Section 6.05;
(i) Permitted Acquisitions;
(j) the Transactions;
(kp) Investments in the ordinary course of business consisting of Article III endorsements for collection or deposit and customary trade arrangements with customers consistent with past practicesdeposit;
(lq) the Borrower and its Subsidiaries may acquire and hold receivables and similar items owing to them in the ordinary course of business and payable or dischargeable in accordance with customary trade terms;
(r) Investments constituting customary deposits made in connection with the purchase of goods or services in the ordinary course of business;
(including debt obligations s) Investments consisting of promissory notes and Equity Interests) other non-cash consideration, in each case received in connection with asset sales or dispositions permitted by Section 6.12 (other than Section 6.12(s) or Section 6.12(t) (to the bankruptcy or reorganization extent relating to Section 6.12(s)); provided that the applicable Loan Party complies with the requirements of suppliers and customers, from financially troubled account debtors or in settlement of delinquent obligations of, or other disputes with, customers and suppliers or upon the foreclosure applicable Collateral Document with respect to any secured Investment such promissory notes or other transfer of title with respect to any secured Investmentinstruments;
(m) loans and advances to Holdings (or any direct or indirect parent thereof) or any Intermediate Parent in lieu of, and not in excess of the amount of (after giving effect to any other loans, advances or Restricted Payments in respect thereof), Restricted Payments to the extent permitted to be made to Holdings (or such parent) or such Intermediate Parent in accordance with Section 6.08(a);
(n) additional Investments and other acquisitions; provided that at the time any such Investment or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition made in reliance on this clause (n), together with the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (n), shall not exceed the sum of (A) the greater of $18,000,000 and 60% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Investment or other acquisition, plus (B) so long as no Event of Default has occurred and is continuing, the Available Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of such Investment;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby;
(pt) advances of payroll payments to employees in the ordinary course of business;
(q) business and Investments and other acquisitions to the extent that payment for such Investments is made with Qualified Equity Interests (excluding Cure Amounts) of Holdings (or any direct or indirect parent thereof or the IPO Entity); provided that (i) such amounts used pursuant to this clause (q) shall not increase employment and severance arrangements of officers and employees in the Available Amount ordinary course of business and (ii) any amounts used for such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof or the IPO Entity) shall otherwise be permitted transactions pursuant to this Section 6.04;
(r) Investments of a Subsidiary acquired after the Effective Date or of a Person merged or consolidated with any Subsidiary in accordance with this Section stock option plans and Section 6.03 after the Effective Date to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger or consolidation employee benefit plans and were in existence on the date of such acquisition, merger or consolidation;
(s) non-cash Investments in connection with tax planning and reorganization activities; provided that after giving effect to any such activities, the security interests of the Lenders in the Collateral, taken as a whole, would not be materially impaired;
(t) Investments consisting of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference to this Section 6.04(t)) under Sections 6.01, 6.02, 6.03, 6.05 and 6.08, respectively;
(u) additional Investments; provided that after giving effect to such Investment (A) on a Pro Forma Basis, the Total Net Leverage Ratio is less than or equal to 4.50 to 1.00 and (B) there is no continuing Event of Default;
(v) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the Borrower;
(w) to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Property, or other rights, in each case arrangements in the ordinary course of business;
(xu) Investments by an Unrestricted Subsidiary entered into prior to any endorsement of a check or other medium of payment for deposit or collection, or any similar transaction in the day such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to the definition normal course of “Unrestricted Subsidiary”business;
(yv) Investments consisting of purchases of assets of Franchisees (including, but not limited to, area development contracts owned by Franchisees) in to the ordinary course of business or otherwise in an amount not exceeding $60,000,000, so long as (A) no Event of Default shall have occurred and be continuing and (B) extent that the Borrower consideration for such Investments is in pro forma compliance made solely with the Qualified Equity Interests of the Borrower;
(w) [intentionally omitted];
(x) other Investments (as valued at the fair market value (as determined in good faith by the Borrower) of such Investment at the time each such Investment is made); provided that as of the last day of the most recently ended Reference Period for which Financial Covenant Statements are available after giving effect to any such purchaseInvestment the Consolidated Total Net Leverage Ratio is not greater than 2.75 to 1.00 on a Pro Forma Basis;
(y) other Investments in an aggregate principal amount not exceeding the greater of (x) $6,000,000 and (y) 10% of Consolidated EBITDA as of the last day of the most recently ended Reference Period for which Financial Statements are available at any time outstanding; and
(z) So long as no Event of Default shall have occurred and be continuing, Investments in Franchisees (including, but not limited to, (i) Guarantees or other credit support of any Indebtedness and other liabilities thereof and (ii) loansto the extent constituting Investments, advances or contributions to the marketing in respect of transfer pricing and advertising funds operating cost-sharing arrangements (i.e. “cost-plus” arrangements) and associated “true-up” payments, in connection with the European Wax Center franchise systems) not to exceed the greater of $20,000,000 and 70% of Consolidated EBITDA;
(aa) Investments consisting of accounts and payment intangibles owing to the Borrower or any of the Restricted Subsidiaries from Franchisees; provided each case, that such obligation shall be on such terms as the Borrower or the applicable Restricted Subsidiary establishes in good faith; and
(bb) Investments consisting of advances or expenditures by any Loan Party to, or on behalf of, any CMF Subsidiary in support of advertising and marketing programs are in the ordinary course consistent with current practices. For purposes of determining compliance with this Section 6.04, in the event that any item of Investment meets the criteria of more than one of the categories of Investments described in clauses (a) through (bb) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such Investment (or any portion thereof) and will only be required to include the amount and type of such Investment in one or more of the above clausesbusiness.
Appears in 2 contracts
Samples: Credit Agreement (Clear Secure, Inc.), Credit Agreement (Clear Secure, Inc.)
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor the The Borrower willwill not, nor and will they not permit any Restricted Subsidiary or Intermediate Parent to, make or hold any Investment, except:
(a) Permitted Investments at the time such Permitted Investment is made;
(b) loans or advances to officers, directors members of the Board of Directors and employees of Holdings, any Intermediate Parent, the Borrower and the its Restricted Subsidiaries (i) for reasonable and customary business-related travel, entertainment, relocation and analogous ordinary business purposes, (ii) in connection with such Person’s purchase of Equity Interests in of Holdings (or any direct or indirect parent thereof) (provided that the amount of such loans and advances made in cash to such Person shall be contributed to the Borrower in cash as in exchange for common equity or other Qualified Equity Interests) and such amounts shall not increase the Available Amount and (iii) for purposes not described in the foregoing clauses (i) and (ii); provided that at the time of incurrence thereof and after giving Pro Forma Effect thereto, the in an aggregate principal amount outstanding in reliance on this clause (iii) shall at any time not to exceed $1,000,0002,500,000;
(c) Investments by Holdings, the Borrower in any Intermediate Parent, Restricted Subsidiary and Investments by any Restricted Subsidiary in the Borrower or any Restricted Subsidiary in any of Holdings, any Intermediate Parent, the Borrower or any other Restricted Subsidiary; provided that, in the case of any Investment by a Loan Party in a Restricted Subsidiary that is not a Loan Party, (i) no Event of Default shall have occurred and be continuing or would result therefrom at the time such Investment is made and (ii) the aggregate outstanding amount of all such Investments made by Loan Parties after the Closing Date in Restricted Subsidiaries that are not Loan Parties in reliance on this clause (c), together with the aggregate cash consideration paid for Permitted Acquisitions of Persons that do not become Subsidiary Loan Parties (or are not merged with and into the Borrower or a Subsidiary Loan Party) or of assets that are not owned by the Borrower or a Subsidiary Loan Party after giving Pro Forma Effect to each such applicable Permitted Acquisition and any transactions occurring in connection therewith in reliance on clause (h) below, shall not exceed the greater of $10,000,000 7,300,000 and 35% of Consolidated EBITDA;
(d) Investments consisting of prepayments to suppliers in the ordinary course of business;
(e) Investments consisting of extensions of trade credit in the ordinary course of business;
(f) Investments (i) existing or contemplated on the date hereof and set forth on Schedule 6.04(f) and any modification, replacement, renewal, reinvestment or extension thereof and (ii) Investments existing on the date hereof by Holdings, the Borrower or any Restricted Subsidiary in the Borrower or any Restricted Subsidiary and any modification, renewal or extension thereof; provided that the amount of the original Investment is not increased except by the terms of such Investment to the extent as set forth on Schedule 6.04(f) or as otherwise permitted by this Section 6.04;
(g) Investments in Swap Agreements permitted under Section 6.01(a)(vi);
(h) promissory notes and other non-cash consideration received in connection with Dispositions permitted by Section 6.05;
(i) Permitted Acquisitions;
(j) the Transactions;
(k) Investments in the ordinary course of business consisting of endorsements for collection or deposit and customary trade arrangements with customers consistent with past practices;
(l) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers and customers, from financially troubled account debtors or in settlement of delinquent obligations of, or other disputes with, customers and suppliers or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment;
(m) loans and advances to Holdings (or any direct or indirect parent thereof) or any Intermediate Parent in lieu of, and not in excess of the amount of (after giving effect to any other loans, advances or Restricted Payments in respect thereof), Restricted Payments to the extent permitted to be made to Holdings (or such parent) or such Intermediate Parent in accordance with Section 6.08(a);
(n) additional Investments and other acquisitions; provided that at the time any such Investment or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition made in reliance on this clause (n), together with the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (n), shall not exceed the sum of (A) the greater of $18,000,000 and 6010% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Investment or other acquisition, plus (B) so long as no Event of Default has occurred and is continuing, the Available Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of such Investment;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby;
(p) advances of payroll payments to employees in the ordinary course of business;
(q) Investments and other acquisitions to the extent that payment for such Investments is made with Qualified Equity Interests (excluding Cure Amounts) of Holdings (or any direct or indirect parent thereof or the IPO Entity); provided that (i) such amounts used pursuant to this clause (q) shall not increase the Available Amount and (ii) any amounts used for such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof or the IPO Entity) shall otherwise be permitted pursuant to this Section 6.04;
(r) Investments of a Subsidiary acquired after the Effective Date or of a Person merged or consolidated with any Subsidiary in accordance with this Section and Section 6.03 after the Effective Date to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger or consolidation and were in existence on the date of such acquisition, merger or consolidation;
(s) non-cash Investments in connection with tax planning and reorganization activities; provided that after giving effect to any such activities, the security interests of the Lenders in the Collateral, taken as a whole, would not be materially impaired;
(t) Investments consisting of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference to this Section 6.04(t)) under Sections 6.01, 6.02, 6.03, 6.05 and 6.08, respectively;
(u) additional Investments; provided that after giving effect to such Investment (A) on a Pro Forma Basis, the Total Net Leverage Ratio is less than or equal to 4.50 to 1.00 and (B) there is no continuing Event of Default;
(v) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the Borrower;
(w) to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Property, or other rights, in each case in the ordinary course of business;
(x) Investments by an Unrestricted Subsidiary entered into prior to the day such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to the definition of “Unrestricted Subsidiary”;
(y) Investments consisting of purchases of assets of Franchisees (including, but not limited to, area development contracts owned by Franchisees) in the ordinary course of business or otherwise in an amount not exceeding $60,000,000, so long as (A) no Event of Default shall have occurred and be continuing and (B) the Borrower is in pro forma compliance with the Financial Covenant after giving effect to any such purchase;
(z) So long as no Event of Default shall have occurred and be continuing, Investments in Franchisees (including, but not limited to, (i) Guarantees or other credit support of any Indebtedness and other liabilities thereof and (ii) loans, advances or contributions to the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater of $20,000,000 and 70% of Consolidated EBITDA;
(aa) Investments consisting of accounts and payment intangibles owing to the Borrower or any of the Restricted Subsidiaries from Franchisees; provided that such obligation shall be on such terms as the Borrower or the applicable Restricted Subsidiary establishes in good faith; and
(bb) Investments consisting of advances or expenditures by any Loan Party to, or on behalf of, any CMF Subsidiary in support of advertising and marketing programs in the ordinary course consistent with current practices. For purposes of determining compliance with this Section 6.04, in the event that any item of Investment meets the criteria of more than one of the categories of Investments described in clauses (a) through (bb) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such Investment (or any portion thereof) and will only be required to include the amount and type of such Investment in one or more of the above clauses.
Appears in 2 contracts
Samples: Credit Agreement (Atlas Technical Consultants, Inc.), Credit Agreement (Atlas Technical Consultants, Inc.)
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor the Borrower will, nor will they permit any Restricted Subsidiary or Intermediate Parent to, make or hold any Investment, except:
(a) Permitted Investments at the time such Permitted Investment is madeInvestments;
(b) loans or advances to officers, directors and employees of Holdings, any Intermediate Parent, the Borrower and the its Restricted Subsidiaries (i) for reasonable and customary business-related travel, entertainment, relocation and analogous ordinary business purposes, (ii) in connection with such Person’s purchase of Equity Interests in of Holdings (or any direct or indirect parent thereofthereof or any Employee Holding Vehicle) (provided that the amount of such loans and advances made in cash to such Person shall be contributed to the Borrower in cash as common equity or Qualified Equity Interests) and (iii) for purposes not described in the foregoing clauses (i) and (ii); provided that at the time of incurrence thereof and after giving Pro Forma Effect thereto, the in an aggregate principal amount outstanding in reliance on this clause (iii) shall at any time not to exceed $1,000,0005,000,000;
(c) Investments (i) by Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary in any of HoldingsLoan Party (excluding any new Restricted Subsidiary that becomes a Loan Party pursuant to such Investment), (ii) by any Intermediate ParentRestricted Subsidiary that is not a Loan Party in any other Restricted Subsidiary that is also not a Loan Party, (iii) by the Borrower or any Restricted Subsidiary (A) in any Restricted Subsidiary; provided that the aggregate outstanding amount of such Investments made by Loan Parties after the Restatement Effective Date in Restricted Subsidiaries that are not Loan Parties in reliance on this clause (ciii)(A) (including any such Investments deemed to be made pursuant to Section 6.14) (together with the amount of Investments made in Restricted Subsidiaries (other than Regulated Subsidiaries) that are not Loan Parties pursuant to Section 6.04(h) and the amount of Investments and acquisitions made pursuant to Section 6.04(m), in each case, after the Restatement Effective Date) shall not exceed the greater Non-Loan Party Investment Amount at the time of $10,000,000 any such Investment, (B) in any Regulated Subsidiary in the form of short-term intercompany advances and 35% of Consolidated EBITDA;
(d) Investments consisting of prepayments to suppliers Indebtedness, in each case made in the ordinary course of businessbusiness to provide for working capital and other operational requirements of such Regulated Subsidiary, (C) in any Restricted Subsidiary that is not a Loan Party, constituting an exchange of Equity Interests of such Restricted Subsidiary for Indebtedness of such Subsidiary, (D) constituting Guarantees of Indebtedness or other monetary obligations of Restricted Subsidiaries that are not Loan Parties owing to any Loan Party or (E) constituting unsecured Guarantees of Trading Debt to the extent such Guarantees are permitted under Section 6.01(a)(iii), (iv) by Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary in Restricted Subsidiaries that are not Loan Parties so long as such Investment is part of a series of simultaneous transactions that result in the proceeds of the initial transaction being invested in one or more Loan Parties or, if the proceeds were initially held by a non-Loan Party, in a Restricted Subsidiary that is not a Loan Party and (v) by Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary in any Restricted Subsidiary that is not a Loan Party, consisting of the contribution of Equity Interests of any other Restricted Subsidiary that is not a Loan Party so long as the Equity Interests of the transferee Restricted Subsidiary is pledged to secure the Secured Obligations;
(ed) Investments consisting of extensions of trade credit in the ordinary course of business;
(fe) Investments (i) existing or contemplated on the date hereof Restatement Effective Date and set forth on Schedule 6.04(f6.04(e) and any modification, replacement, renewal, reinvestment or extension thereof and (ii) Investments existing on the date hereof Restatement Effective Date by Holdings, the Borrower or any Restricted Subsidiary in the Borrower or any Restricted Subsidiary and any modification, renewal or extension thereof; provided that in each case the amount of the original Investment is not increased except by the terms of such Investment to the extent as set forth on Schedule 6.04(f6.04(e) or as otherwise permitted by this Section 6.04;
(gf) Investments in Swap Agreements permitted under Section 6.01(a)(vi)6.07;
(hg) promissory notes and other non-cash consideration received in connection with Dispositions permitted by Section 6.05;
(ih) Permitted Acquisitions; provided that the aggregate amount of consideration paid or provided by Holdings, any Intermediate Parent, the Borrower or any other Loan Party (including any Indebtedness incurred by any such Person to finance any portion of such consideration) after the Restatement Effective Date in reliance on this Section 6.04(h) (together with any Investments made in Subsidiaries that are not Loan Parties pursuant to Section 6.04(c)(iii)(A), Investments deemed to be made pursuant to Section 6.14 and the amount of Investments and acquisitions made pursuant to Section 6.04(m), in each case, after the Restatement Effective Date) for Permitted Acquisitions (including the aggregate principal amount of all Indebtedness assumed in connection with Permitted Acquisitions) of any Restricted Subsidiary (other than a Regulated Subsidiary) that shall not be or, after giving effect to such Permitted Acquisition, shall not become, a Loan Party, shall not exceed the Non-Loan Party Investment Amount at such time;
(i) [reserved];
(j) the Transactions;
(k) Investments in the ordinary course of business consisting of Uniform Commercial Code Article 3 endorsements for collection or deposit and Uniform Commercial Code Article 4 customary trade arrangements with customers consistent with past practices;
(lk) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers and customers, from financially troubled account debtors customers or in settlement of delinquent obligations of, or other disputes with, customers and suppliers or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment;
(ml) loans and advances to Holdings (or any direct or indirect parent thereof) or any Intermediate Parent in lieu of, and not in excess of the amount of (after giving effect to any other loans, advances or Restricted Payments in respect thereof), Restricted Payments to the extent permitted to be made to Holdings (or such parent) or such Intermediate Parent in accordance with Section 6.08(a6.08(a)(iv), (v), (vi), (vii) or (viii);
(nm) additional so long as immediately after giving effect to any such Investment or acquisition no Default shall have occurred and be continuing, other Investments and other acquisitions; provided that at the time any such Investment (including any such Investments deemed to be made pursuant to Section 6.14) or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition all Investments made in reliance on this clause (nm) (including all such Investments deemed made pursuant to Section 6.14), Investments made in Subsidiaries that are not Loan Parties pursuant to Section 6.04(c)(iii)(A) and Investments made in Restricted Subsidiaries (other than Regulated Subsidiaries) that are not Loan Parties pursuant to Section 6.04(h), together with the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (nm) (including the aggregate principal amount of all Indebtedness assumed in connection with any such other acquisition), in each case, after the Restatement Effective Date, shall not exceed the sum Non-Loan Party Investment Amount at the time of (A) the greater of $18,000,000 and 60% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of any such Investment or other acquisition, plus (B) so long as no Event of Default has occurred and is continuing, the Available Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of such Investment;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby;
(pn) advances of payroll payments to employees in the ordinary course of business;
(qo) Investments and other acquisitions to the extent that payment for such Investments is made solely with Qualified Equity Interests (excluding Cure Amounts) of Holdings (or any direct or indirect parent thereof or the IPO Entitythereof); provided that (i) such amounts used pursuant to this clause (q) shall not increase the Available Amount and (ii) any amounts used for such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof or the IPO Entity) shall otherwise be permitted pursuant to this Section 6.04;
(rp) Investments of a Subsidiary acquired after the Restatement Effective Date or of a Person merged or consolidated with any Subsidiary in accordance with this Section and Section 6.03 after the Restatement Effective Date (other than existing Investments in subsidiaries of such Subsidiary or Person, which must comply with the requirements of Section 6.04(h) or 6.04(m)) to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger or consolidation and were in existence on the date of such acquisition, merger or consolidation;
(sq) Investments made or acquired in the ordinary course trading activities of the Borrower and its Restricted Subsidiaries;
(r) non-cash Investments in connection with tax planning and reorganization activities; provided that after giving effect to any such activities, the security interests of the Lenders in the Collateral, taken as a whole, would not be materially impaired;
(t) Investments consisting of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference to this Section 6.04(t)) under Sections 6.01, 6.02, 6.03, 6.05 and 6.08, respectively;
(u) additional Investments; provided that after giving effect to such Investment (A) on a Pro Forma Basis, the Total Net Leverage Ratio is less than or equal to 4.50 to 1.00 and (B) there is no continuing Event of Default;
(v) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the Borrower;
(w) to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Property, or other rights, in each case in the ordinary course of business;
(x) Investments by an Unrestricted Subsidiary entered into prior to the day such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to the definition of “Unrestricted Subsidiary”;
(y) Investments consisting of purchases of assets of Franchisees (including, but not limited to, area development contracts owned by Franchisees) in the ordinary course of business or otherwise in an amount not exceeding $60,000,000, so long as (A) no Event of Default shall have occurred and be continuing and (B) the Borrower is in pro forma compliance with the Financial Covenant after giving effect to any such purchase;
(z) So long as no Event of Default shall have occurred and be continuing, Investments in Franchisees (including, but not limited to, (i) Guarantees or other credit support of any Indebtedness and other liabilities thereof and (ii) loans, advances or contributions to the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater of $20,000,000 and 70% of Consolidated EBITDA;
(aa) Investments consisting of accounts and payment intangibles owing to the Borrower or any of the Restricted Subsidiaries from Franchisees; provided that such obligation shall be on such terms as the Borrower or the applicable Restricted Subsidiary establishes in good faith; and
(bbs) Investments consisting of advances or expenditures by in any Loan Party to, or on behalf of, any CMF Foreign Subsidiary in support of advertising and marketing programs in made for the ordinary course consistent with current practices. For purposes of determining compliance providing such Foreign Subsidiary the necessary capital to comply with this Section 6.04, in any capital or margin requirements of a Regulatory Supervisory Organization; provided that the event that any item of Investment meets the criteria of more than one of the categories aggregate outstanding amount of Investments described in clauses (a) through (bb) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such Investment (or made pursuant to this clause shall not exceed $25,000,000 at any portion thereof) and will only be required to include the amount and type of such Investment in one or more of the above clausestime.
Appears in 1 contract
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor the The Borrower willwill not, nor and will they not permit any Restricted Subsidiary or Intermediate Parent to, make or hold any Investment, except:
(a) Permitted Investments at the time such Permitted Investment is madeInvestments;
(b) loans or advances to officers, directors members of the Board of Directors and employees of Holdings, any Intermediate Parent, the Borrower and the its Restricted Subsidiaries (i) for reasonable and customary business-related travel, entertainment, relocation and analogous ordinary business purposes, (ii) in connection with such Person’s purchase of Equity Interests in of Holdings (or any direct or indirect parent thereof) (provided that the amount of such loans and advances made in cash to such Person shall be contributed to the Borrower in cash as common equity or Qualified Equity Interests) and (iii) for purposes not described in the foregoing clauses (i) and (ii); provided that at the time of incurrence thereof and after giving Pro Forma Effect thereto, the in an aggregate principal amount outstanding in reliance on this clause (iii) shall at any time not to exceed $1,000,00020,000,000;
(c) Investments (i) by Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary in any of HoldingsLoan Party (excluding any new Restricted Subsidiary that becomes a Loan Party pursuant to such Investment), (ii) by any Intermediate ParentRestricted Subsidiary that is not a Loan Party in any other Restricted Subsidiary that is also not a Loan Party, (iii) by the Borrower or any Restricted Subsidiary (A) in any Restricted Subsidiary; provided that the aggregate outstanding amount of such Investments made by Loan Parties after the Third Amendment Effective Date in Restricted Subsidiaries that are not Loan Parties in reliance on this clause (ciii)(A) (together with the amount of Investments made in Restricted Subsidiaries that are not Loan Parties pursuant to Section 6.04(h)) shall not exceed the greater Non-Loan Party Investment Amount at the time of $10,000,000 any such Investment, (B) in any Restricted Subsidiary that is not a Loan Party, constituting an exchange of Equity Interests of such Restricted Subsidiary for Indebtedness of such Subsidiary or (C) constituting Guarantees of Indebtedness or other monetary obligations of Restricted Subsidiaries that are not Loan Parties owing to any Loan Party, (iv) by the Borrower or any Restricted Subsidiary in Restricted Subsidiaries that are not Loan Parties so long as such Investment is part of a series of simultaneous Investments that result in the proceeds of the initial Investment being invested in one or more Loan Parties or being applied to make an Investment otherwise permitted under this Section 6.04 and 35% (v) by the Borrower or any Restricted Subsidiary in any Restricted Subsidiary that is not a Loan Party, consisting of Consolidated EBITDAthe contribution of Equity Interests of any other Restricted Subsidiary that is not a Loan Party so long as the Equity Interests of the transferee Restricted Subsidiary is pledged to secure the Secured Obligations;
(d) Investments consisting of prepayments to suppliers extensions of trade credit and accommodation guarantees in the ordinary course of business;
(ei) Investments consisting of extensions of trade credit in the ordinary course of business;
(f) Investments (i) existing or contemplated on the date hereof Third Amendment Effective Date and potential Investments, in each case as set forth on Schedule 6.04(f6.04(e) and (provided that, for the avoidance of doubt, if the amount of any modificationsuch potential Investment exceeds the limit, replacementif any, renewalon such Investment set forth on Schedule 6.04(e), reinvestment or extension thereof the amount of such excess shall only be permitted hereunder to the extent otherwise permitted by this Section 6.04 (excluding this Section 6.04(e)) and (ii) Investments existing on the date hereof Third Amendment Effective Date by Holdings, the by the Borrower or any Restricted Subsidiary in the Borrower or any Restricted Subsidiary and and, in each case, any modification, renewal replacement, renewal, reinvestment or extension thereof; provided that the amount of the original Investment is not increased except by the terms of such Investment to the extent as set forth on Schedule 6.04(f6.04(e) or as otherwise permitted by this Section 6.04;
(gf) Investments in Swap Agreements permitted under Section 6.01(a)(vi)incurred in the ordinary course of business and not for speculative purposes;
(hg) promissory notes and other non-cash consideration received in connection with Dispositions permitted by Section 6.05;
(ih) Permitted Acquisitions; provided that the aggregate amount of consideration paid or provided by the Borrower or any other Loan Party after the Third Amendment Effective Date in reliance on this Section 6.04(h) (together with any Investments made in Subsidiaries that are not Loan Parties pursuant to Section 6.04(c)(iii)(A)) for Permitted Acquisitions (including the aggregate principal amount of all Indebtedness assumed in connection with Permitted Acquisitions) for any Restricted Subsidiary that shall not be or, after giving effect to such Permitted Acquisition, shall not become a Loan Party, shall not exceed the Non-Loan Party Investment Amount at such time;
(i) the Third Amendment Transactions;
(j) the Transactions;
(k) Investments in the ordinary course of business consisting of Uniform Commercial Code Article 3 endorsements for collection or deposit and Uniform Commercial Code Article 4 customary trade arrangements with customers consistent with past practices;
(lk) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers and customers, from financially troubled account debtors customers or in settlement of delinquent obligations of, or other disputes with, customers and suppliers or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment;
(ml) loans and advances to Holdings (or any direct or indirect parent thereof) or any Intermediate Parent in lieu of, and not in excess of the amount of (after giving effect to any other loans, advances or Restricted Payments in respect thereof), Restricted Payments to the extent permitted to be made to Holdings (or such parent) or such Intermediate Parent in accordance with Section 6.08(a6.07(a)(iv), (v), (vii) or (viii);
(nm) additional so long as immediately after giving effect to any such Investment no Event of Default has occurred and is continuing, other Investments and other acquisitions; provided that at the time any such Investment or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition all Investments made in reliance on this clause (nm) (including all such Investments deemed to be made pursuant to clause (d) of the definition of “Non-Loan Party Investment Amount”), together with the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (nm) (including the aggregate principal amount of all Indebtedness assumed in connection with any such other acquisition), shall not exceed the sum of (Aw) the greater of $18,000,000 105,000,000 and 6050% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Investment or other acquisition, plus (Bx) so long as no Event of Default has occurred and is continuing, the Available Initial Restricted Payment Amount that is Not Otherwise Applied plus (y) so long as (A) the Fixed Charge Coverage Ratio for the Test Period then last ended shall be at least 2.00 to 1.00, and (B) the Borrower shall be in effect immediately prior Pro Forma Compliance with the Financial Performance Covenant as of the end of the most recently ended Test Period, the amount of Cumulative Excess Cash Flow that is Not Otherwise Applied plus (z) the aggregate amount of the Net Proceeds of the issuance of, or contribution of cash in respect of existing Qualified Equity Interests (other than any such issuance or contribution made pursuant to the time of making of such InvestmentSection 7.02) that is Not Otherwise Applied;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby;
(pn) advances of payroll payments to employees in the ordinary course of business;
(qo) Investments and other acquisitions to the extent that payment for such Investments is made solely with Qualified Equity Interests (excluding Qualified Equity Interests the proceeds of which are applied, or are to be applied, as Cure Amounts) of Holdings (or any direct or indirect parent thereof or the IPO Entitythereof); provided that (i) such amounts used pursuant to this clause (q) shall not increase the Available Amount and (ii) any amounts used for such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof or the IPO Entity) shall otherwise be permitted pursuant to this Section 6.04;
(rp) Investments of a Subsidiary acquired after the Third Amendment Effective Date or of a Person merged or consolidated with any Subsidiary in accordance with this Section 6.04 and Section 6.03 after the Third Amendment Effective Date or that otherwise becomes a Subsidiary (provided that if such Investment is made under Section 6.04(h), existing Investments in subsidiaries of such Subsidiary or Person shall comply with the requirements of Section 6.04(h) or 6.04(m) or any other paragraph of this Section 6.04) to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger or consolidation and were in existence on the date of such acquisition, merger or consolidation;
(sq) receivables owing to the Borrower or any Restricted Subsidiary, if created or acquired in the ordinary course of business;
(r) non-cash Investments in connection with tax planning and reorganization activities; provided that that, in the reasonable judgment of the Administrative Agent (following consultation with the Borrower), after giving effect to any such activities, the security interests of the Lenders in the Collateral, taken as a whole, would not be materially impaired;; and
(ts) Investments consisting of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference to this Section 6.04(t)) under Sections 6.01, 6.02, 6.03, 6.05 and 6.08, respectively;
(u) additional Investments; provided that after giving effect to such Investment (A) on a Pro Forma Basisfor utilities, security deposits, leases and similar prepaid expenses incurred in the Total Net Leverage Ratio is less than or equal to 4.50 to 1.00 ordinary course of business and (B) there is no continuing Event of Default;
(v) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the Borrower;
(w) to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Propertytrade accounts created, or other rightsprepaid expenses accrued, in each case in the ordinary course of business;
(x) Investments by an Unrestricted Subsidiary entered into prior to the day such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to the definition of “Unrestricted Subsidiary”;
(y) Investments consisting of purchases of assets of Franchisees (including, but not limited to, area development contracts owned by Franchisees) in the ordinary course of business or otherwise in an amount not exceeding $60,000,000, so long as (A) no Event of Default shall have occurred and be continuing and (B) the Borrower is in pro forma compliance with the Financial Covenant after giving effect to any such purchase;
(z) So long as no Event of Default shall have occurred and be continuing, Investments in Franchisees (including, but not limited to, (i) Guarantees or other credit support of any Indebtedness and other liabilities thereof and (ii) loans, advances or contributions to the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater of $20,000,000 and 70% of Consolidated EBITDA;
(aa) Investments consisting of accounts and payment intangibles owing to the Borrower or any of the Restricted Subsidiaries from Franchisees; provided that such obligation shall be on such terms as the Borrower or the applicable Restricted Subsidiary establishes in good faith; and
(bb) Investments consisting of advances or expenditures by any Loan Party to, or on behalf of, any CMF Subsidiary in support of advertising and marketing programs in the ordinary course consistent with current practices. For purposes of determining compliance with this Section 6.04, in the event that any item of Investment meets the criteria of more than one of the categories of Investments described in clauses (a) through (bb) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such Investment (or any portion thereof) and will only be required to include the amount and type of such Investment in one or more of the above clauses.
Appears in 1 contract
Samples: Credit Agreement (Endurance International Group Holdings, Inc.)
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor the The Borrower willwill not, nor and will they not permit any Restricted Subsidiary or Intermediate Parent to, make or hold any Investment, except:
(a) Permitted Investments at the time such Permitted Investment is madeInvestments;
(b) loans or advances to officers, directors and employees of Holdings, any Intermediate Parent, the Borrower and the its Restricted Subsidiaries (i) for reasonable and customary business-related travel, entertainment, relocation and analogous ordinary business purposespurposes of the Borrower and the Restricted Subsidiaries, (ii) in connection with such Person’s purchase of Equity Interests in Holdings (or any direct or indirect parent thereof) (provided that of the amount of such loans and advances made in cash to such Person shall be contributed to the Borrower in cash as common equity or Qualified Equity Interests) Borrower, and (iii) for purposes not described in the foregoing clauses (i) and (ii); provided that at the time of incurrence thereof and after giving Pro Forma Effect thereto, the aggregate principal amount outstanding in reliance on at any time under this clause (iiib)(iii) shall not to exceed $1,000,0003,500,000;
(c) Investments (i) by Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary in any of HoldingsLoan Party (excluding any new Restricted Subsidiary that becomes a Loan Party pursuant to such Investment), (ii) by any Intermediate ParentRestricted Subsidiary that is not a Loan Party in any other Restricted Subsidiary that is also not a Loan Party, (iii) by the Borrower or any Loan Party (A) in any Restricted Subsidiary; provided that the aggregate outstanding amount of such Investments made by Loan Parties after the Closing Date in Restricted Subsidiaries that are not Loan Parties in reliance on this clause (ciii)(A) shall not exceed the greater Non-Loan Party Investment Amount, (B) in any Restricted Subsidiary that is not a Loan Party, constituting an exchange of $10,000,000 Equity Interests of such Restricted Subsidiary for Indebtedness of such Restricted Subsidiary or (C) constituting Guarantees of Indebtedness or other monetary obligations of Restricted Subsidiaries that are not Loan Parties owing to any Loan Party, (iv) by the Borrower or any Restricted Subsidiary in Restricted Subsidiaries that are not Loan Parties so long as such Investment is part of a series of simultaneous Investments that result in the proceeds of the initial Investment being invested in one or more Loan Parties and 35% (v) by the Borrower or any Restricted Subsidiary in any Restricted Subsidiary that is not a Loan Party, consisting of Consolidated EBITDAthe contribution of Equity Interests of any other Restricted Subsidiary that is not a Loan Party so long as the Equity Interests of the transferee Restricted Subsidiary is pledged to secure the Secured Obligations;
(d) Investments consisting of prepayments to suppliers in the ordinary course of businessSeed Capital Investments;
(e) Investments consisting of extensions of trade credit in the ordinary course of business;
(f) Investments (i) existing or contemplated on the date hereof Closing Date and set forth on Schedule 6.04(f6.04(e) and any modification, replacement, renewal, reinvestment or extension thereof and (ii) Investments existing on the date hereof Closing Date by Holdings, the Borrower or any Restricted Subsidiary in the Borrower or any Restricted Subsidiary and any modification, renewal or extension thereof; provided that the amount of the original Investment is not increased except by the terms of such Investment to the extent as set forth on Schedule 6.04(f6.04(e) or as otherwise permitted by this Section 6.04;
(gf) Investments in Swap Agreements permitted under Section 6.01(a)(vi)incurred in the ordinary course of business and not for speculative purposes;
(hg) promissory notes and other non-cash consideration received in connection with Dispositions permitted by Section 6.05;
(ih) Permitted Acquisitions; provided that the aggregate amount of consideration paid or provided by the Borrower or any other Loan Party after the Closing Date in reliance on this Section 6.04(h) for Permitted Acquisitions (including the aggregate principal amount of all Indebtedness assumed in connection with Permitted Acquisitions) for any Restricted Subsidiary that shall not be or, after giving effect to such Permitted Acquisition, shall not become a Loan Party, shall not exceed the Non-Loan Party Investment Amount;
(i) the Borrower and its Restricted Subsidiaries may consummate the Acquisition;
(j) the Transactions;
(k) Investments in the ordinary course of business consisting of Uniform Commercial Code Article 3 endorsements for collection or deposit and Uniform Commercial Code Article 4 customary trade arrangements with customers consistent with past practices;
(lk) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers and customers, from financially troubled account debtors customers or in settlement of delinquent obligations of, or other disputes with, customers and suppliers or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment;
(l) Investments for (i) utilities, security deposits, leases and similar prepaid expenses incurred in the ordinary course of business and (ii) trade accounts created, or prepaid expenses accrued, in the ordinary course of business;
(m) loans and advances to Holdings other Investments; provided that (or any direct or indirect parent thereofi) or any Intermediate Parent in lieu of, and not in excess of the amount of (so long as immediately after giving effect to any other loans, advances or Restricted Payments in respect thereof), Restricted Payments to the extent permitted to be made to Holdings (or such parent) or such Intermediate Parent in accordance with Section 6.08(a);
(n) additional Investments and other acquisitions; provided that at the time any such Investment or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition made in reliance on this clause (n), together with the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (n), shall not exceed the sum of (A) the greater of $18,000,000 and 60% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Investment or other acquisition, plus (B) so long as no Event of Default has occurred and is continuing, and (ii) the aggregate outstanding amount of all Investments made in reliance on this clause (m) shall not exceed (A) the greater of (x) $7,500,000 and (y) 5.0% of LTM EBITDA plus (B) the Available Amount Amount;
(n) other Investments; provided that is Not Otherwise Applied as in effect immediately prior to (i) no Event of Default shall have occurred and be continuing or shall result therefrom and (ii) on a Pro Forma Basis, the time of making of such InvestmentTotal Net Leverage Ratio shall not exceed 2.00:1.00;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby;
(p) advances of payroll payments to employees in the ordinary course of business;
(q) Investments and other acquisitions to the extent that payment for such Investments is made with Qualified Equity Interests (excluding Cure Amounts) of Holdings (or any direct or indirect parent thereof or the IPO Entity); provided that (i) such amounts used pursuant to this clause (q) shall not increase the Available Amount and (ii) any amounts used for such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof or the IPO Entity) shall otherwise be permitted pursuant to this Section 6.04;
(rp) Investments of a Subsidiary acquired after the Effective Closing Date or of a Person merged or consolidated with any Subsidiary in accordance with this Section and Section 6.03 after the Effective Closing Date or that otherwise becomes a Subsidiary to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger or consolidation and were in existence on the date of such acquisition, merger or consolidation;
(sq) non-cash Investments in connection with tax planning and reorganization activities; provided that after giving effect to any such activities, the security interests of the Lenders in the Collateral, taken as a whole, would not be materially impaired;
(t) Investments consisting of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference to this Section 6.04(t)) under Sections 6.01, 6.02, 6.03, 6.05 and 6.08, respectively;
(u) additional Investments; provided that after giving effect to such Investment (A) on a Pro Forma Basis, the Total Net Leverage Ratio is less than or equal to 4.50 to 1.00 and (B) there is no continuing Event of Default;
(v) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the Borrower;
(w) receivables owing to the extent that they constitute InvestmentsBorrower or any Restricted Subsidiary, purchases and acquisitions of inventory, supplies, materials if created or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Property, or other rights, in each case acquired in the ordinary course of business;
(x) Investments by an Unrestricted Subsidiary entered into prior to the day such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to the definition of “Unrestricted Subsidiary”;
(y) Investments consisting of purchases of assets of Franchisees (including, but not limited to, area development contracts owned by Franchisees) in the ordinary course of business or otherwise in an amount not exceeding $60,000,000, so long as (A) no Event of Default shall have occurred and be continuing and (B) the Borrower is in pro forma compliance with the Financial Covenant after giving effect to any such purchase;
(z) So long as no Event of Default shall have occurred and be continuing, Investments in Franchisees (including, but not limited to, (i) Guarantees or other credit support of any Indebtedness and other liabilities thereof and (ii) loans, advances or contributions to the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater of $20,000,000 and 70% of Consolidated EBITDA;
(aa) Investments consisting of accounts and payment intangibles owing to the Borrower or any of the Restricted Subsidiaries from Franchisees; provided that such obligation shall be on such terms as the Borrower or the applicable Restricted Subsidiary establishes in good faith; and
(bbr) Investments consisting of advances or expenditures by in any Loan Party to, or on behalf of, any CMF Restricted Subsidiary that is a Broker-Dealer Subsidiary to the extent necessary in support of advertising and marketing programs order for such Restricted Subsidiary to be in the ordinary course consistent with current practices. For purposes of determining compliance with this Section 6.04, in the event that its net capital requirements under any item Requirements of Investment meets the criteria of more than one of the categories of Investments described in clauses (a) through (bb) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such Investment (or any portion thereof) and will only be required to include the amount and type of such Investment in one or more of the above clausesLaws.
Appears in 1 contract
Samples: Credit Agreement (Virtus Investment Partners, Inc.)
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor None of the Borrower willCompany or any Subsidiary will purchase, nor will they permit hold, acquire (including pursuant to any Restricted merger or consolidation with any Person that was not a wholly-owned Subsidiary or Intermediate Parent toprior thereto), make or hold otherwise permit to exist any InvestmentInvestment in any other Person, except:
(a) Permitted Investments at the time such Permitted Investment is madePCB Acquisition and, to the extent constituting Investments, the Transactions;
(b) loans cash and Permitted Investments;
(c) (i) Investments existing on the Effective Date in Subsidiaries and (ii) other Investments existing or contemplated on the Effective Date and set forth on Schedule 6.04 and any modification, replacement, renewal, reinvestment or extension thereof provided that the amount of any Investment permitted pursuant to this Section 6.04(c) is not increased from the amount of such Investment on the Effective Date except pursuant to the terms of such Investment as of the Effective Date or as otherwise permitted by this Section 6.04;
(d) (i) additional Investments by the Company in any Subsidiary Guarantor and by any Subsidiary Guarantor in the Company or in another Subsidiary Guarantor, and (ii) Investments (including by way of capital contributions) by the Company and the Subsidiaries in Equity Interests in their Subsidiaries; provided, in the case of clause (ii), that (x) any such Equity Interests held by the Company or any Subsidiary Guarantor shall be pledged in accordance with the requirements of Section 5.09 and (y) the aggregate amount of Investments made by the Company or any Subsidiary Guarantor in any Subsidiary that is not a Subsidiary Guarantor in reliance on this clause (d), when combined with the aggregate amount of Guarantees made by the Company or any Subsidiary Guarantor of Indebtedness (excluding, for the avoidance of doubt, Guarantees of obligations not constituting Indebtedness) of any Subsidiary that is not a Subsidiary Guarantor in reliance on clause (e) below, shall not exceed the greater of (x) $35,000,000 and (y) 3% of Consolidated Total Assets (at the time made);
(e) Guarantees by the Company or any Subsidiary of Indebtedness or other obligations of the Company or any Subsidiary (including any such Guarantees arising as a result of any such Person being a joint and several co-applicant with respect to any letter of credit or letter of guaranty); provided that (i) any such Guarantee of Subordinated Indebtedness is subordinated to the Secured Obligations on terms no less favorable to the Lenders than those of the Subordinated Indebtedness, (ii) any such Guarantee constituting Indebtedness is permitted by Section 6.01 (other than clause (d) thereof) and (iii) the aggregate amount of Guarantees made by the Company or any Subsidiary Guarantor of Indebtedness (excluding, for the avoidance of doubt, Guarantees of obligations not constituting Indebtedness) of any Subsidiary that is not a Subsidiary Guarantor in reliance on this clause (e), when combined with the aggregate amount of Investments made by the Company or any Subsidiary Guarantor in any Subsidiary that is not a Subsidiary Guarantor in reliance on clause (d) above, shall not exceed the greater of (x) $35,000,000 and (y) 3% of Consolidated Total Assets (at the time made);
(f) loans, advances or other extensions of credit to officers, directors and employees of Holdings, the Company or any Intermediate Parent, the Borrower and the Restricted Subsidiaries Subsidiary (i) to finance the purchase of Equity Interests of the Company pursuant to employee plans, (ii) for reasonable and customary business-related travel, entertainment, relocation and analogous moving and relocation, business machines or supplies, automobiles and other similar expenses and advances, in each case incurred in the ordinary business purposescourse of business, (ii) in connection with such Person’s purchase of Equity Interests in Holdings (or any direct or indirect parent thereof) (provided that the amount of such loans and advances made in cash to such Person shall be contributed to the Borrower in cash as common equity or Qualified Equity Interests) and (iii) for purposes not described in the foregoing clauses (i) and (ii); provided that at the time of incurrence thereof and after giving Pro Forma Effect thereto, the in an aggregate principal amount outstanding in reliance on this at any time under clause (iii) shall not to exceed $1,000,000;
(c) Investments by Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary in any of Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary; provided that the aggregate outstanding amount of Investments made by Loan Parties in Restricted Subsidiaries that are not Loan Parties in reliance on this clause (c) shall not exceed the greater of $10,000,000 and 35% of Consolidated EBITDA;
(d) Investments consisting of prepayments to suppliers in the ordinary course of business;
(e) Investments consisting of extensions of trade credit in the ordinary course of business;
(f) Investments (i) existing or contemplated on the date hereof and set forth on Schedule 6.04(f) and any modification, replacement, renewal, reinvestment or extension thereof and (ii) Investments existing on the date hereof by Holdings, the Borrower or any Restricted Subsidiary in the Borrower or any Restricted Subsidiary and any modification, renewal or extension thereof; provided that the amount of the original Investment is not increased except by the terms of such Investment to the extent as set forth on Schedule 6.04(f) or as otherwise permitted by this Section 6.0410,000,000;
(g) Investments in Swap Agreements permitted under Section 6.01(a)(vi);
(h) promissory notes and other non-cash consideration received in connection with Dispositions permitted by Section 6.05;
(i) Permitted Acquisitions;
(j) the Transactions;
(k) Investments in the ordinary course of business consisting of endorsements for collection or deposit and customary trade arrangements with customers consistent with past practices;
(l) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers and customersof, from financially troubled account debtors or in settlement of delinquent obligations of, or other accounts and disputes with, customers and suppliers suppliers, or consisting of securities acquired in connection with the satisfaction or enforcement of claims due or owing to the Company or any Subsidiary, in each case in the ordinary course of business or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment;
(mh) Permitted Acquisitions (including any intercompany investments, loans and advances used to Holdings (or any direct or indirect parent thereof) or any Intermediate Parent in lieu of, and not in excess of the amount of (after giving effect to any other loans, advances or Restricted Payments in respect thereof), Restricted Payments to the extent permitted to be made to Holdings (or such parent) or such Intermediate Parent in accordance with Section 6.08(aconsummate Permitted Acquisitions);
(n) additional Investments and other acquisitions; provided that at the time any such Investment or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition made in reliance on this clause (n), together with the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (n), shall not exceed the sum of (A) the greater of $18,000,000 and 60% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Investment or other acquisition, plus (B) so long as no Event of Default has occurred and is continuing, the Available Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of such Investment;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby;
(p) advances of payroll payments to employees in the ordinary course of business;
(qi) Investments and other acquisitions to the extent that payment for such Investments is made with Qualified Equity Interests (excluding Cure Amounts) of Holdings (or any direct or indirect parent thereof or the IPO Entity); provided that (i) such amounts used pursuant to this clause (q) shall not increase the Available Amount and (ii) any amounts used for such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof or the IPO Entity) shall otherwise be permitted pursuant to this Section 6.04;
(r) Investments of held by a Subsidiary acquired after the Effective Date or of a Person merged or consolidated with any or into the Company or a Subsidiary in accordance with this Section and Section 6.03 after the Effective Date Date, in each case as permitted hereunder, to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger or consolidation and were in existence on the date of such acquisition, merger or consolidation;
(sj) non-cash Investments constituting, or made as a result of the receipt of noncash consideration from a sale, transfer, lease or other disposition of any asset in compliance with Section 6.05;
(k) Investments by the Company or any Subsidiary that result solely from the receipt by the Company or such Subsidiary from any of its subsidiaries of a dividend or other Restricted Payment in the form of Equity Interests, evidences of Indebtedness or other securities (but not any additions thereto made after the date of the receipt thereof);
(l) Investments in the form of Swap Agreements permitted under Section 6.07;
(m) Investments by Foreign Subsidiaries in other Foreign Subsidiaries or by any Subsidiary that is not a Subsidiary Guarantor in any other Subsidiary that is not a Subsidiary Guarantor;
(n) Investments constituting deposits described in clauses (c) and (d) of the definition of “Permitted Encumbrances”;
(o) Investments consisting of (i) extensions of trade credit, (ii) deposits made in connection with tax planning the purchase of goods or services or the performance of leases, licenses or contracts, in each case, in the ordinary course of business, (iii) notes receivable of, or prepaid royalties and reorganization activities; provided other extensions of credit to, customers and suppliers that after giving effect to any such activities, the security interests are not Affiliates of the Lenders Company and that are made in the Collateralordinary course of business and (iv) Guarantees made in the ordinary course of business in support of obligations of the Company or any of its Subsidiaries not constituting Indebtedness for borrowed money, taken including operating leases and obligations owing to suppliers, customers and licensees;
(p) mergers and consolidations permitted under Section 6.03 that do not involve any Person other than the Company and Subsidiaries that are wholly-owned Subsidiaries;
(q) intercompany loans or other intercompany Investments made by Loan Parties in the ordinary course of business to or in any Foreign Subsidiary to provide funds as necessary to enable the applicable Foreign Subsidiary to comply with changes in statutory or contractual capital requirements (other than any contractual requirement that constitutes a wholeGuarantee);
(r) Investments consisting of Guarantees in the ordinary course of business to support the obligations of any Subsidiary under its worker’s compensation and general insurance agreements;
(s) the Company’s entry into (including payments of premiums in connection therewith), would not be materially impairedand the performance of obligations under, Permitted Call Spread Swap Agreements in accordance with their terms;
(t) other Investments, including Investments consisting in connection with the acquisition of IndebtednessForeign Subsidiaries or other Persons that will not be Subsidiary Guarantors, Liensin an aggregate amount not in excess of (i) $25,000,000 plus (ii) if the Total Leverage Ratio immediately after giving effect (including pro forma effect) to any such Investment, fundamental changescalculated on a pro forma basis for the period of four (4) consecutive fiscal quarters ending on the most recent fiscal quarter of the Company for which Financials have been delivered, Dispositions and Restricted Payments permitted (other is less than by reference 4.75 to 1.00, in an amount not in excess of the Available Amount at the time such Investment is made; provided, however, that at the time any such Investment is made pursuant to this Section 6.04(tclause (t), no Default shall have occurred and be continuing or would result after giving effect (including pro forma effect) under Sections 6.01, 6.02, 6.03, 6.05 and 6.08, respectivelythereto;
(u) additional other Investments, including Investments in connection with the acquisition of Foreign Subsidiaries or other Persons that will not be Subsidiary Guarantors; provided that (i) no Default or Event of Default has occurred and is continuing prior to making such Investment or would arise after giving effect (including pro forma effect) thereto and (ii) after giving effect (including pro forma effect) to such Investment (A) on a Pro Forma BasisInvestment, the Total Net Leverage Ratio is less than or equal to 4.50 to 1.00 and Ratio, calculated on a pro forma basis for the period of four (B4) there is no continuing Event consecutive fiscal quarters ending on the most recent fiscal quarter of Defaultthe Company for which Financials have been delivered, shall not exceed 2.75:1.00;
(v) contributions Investments in joint ventures of the Company or any Subsidiary, taken together with all other Investments made pursuant to a “rabbi” trust for this clause (v) that are at that time outstanding, not to exceed the benefit greater of employees(i) $20,000,000 and (ii) 2.00% of Consolidated Total Assets (in each case, directorsdetermined on the date such Investment is made, consultants, independent contractors or other service providers or other grantor trust subject with the fair market value of each Investment being measured at the time made and without giving effect to claims subsequent changes in value) advances of creditors payroll payments to employees in the case ordinary course of a bankruptcy of Holdings or the Borrowerbusiness;
(w) Investments to the extent that payment for such Investments is made solely with Equity Interests (other than Disqualified Equity Interests) of the Company;
(x) the forgiveness or conversion to equity of any Indebtedness owed by the Company or any Subsidiary and permitted by Section 6.01;
(y) Investments in any Term Loans in accordance with Section 9.04(f)
(z) to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Property, or other rights, in each case in the ordinary course of business;; and
(xaa) Investments by an Unrestricted Subsidiary entered into prior arising as a result of Sale and Leaseback Transactions; and
(bb) to the day such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to the definition of “Unrestricted Subsidiary”;
(y) extent constituting Investments, intercompany loans or other intercompany Investments consisting of purchases of assets of Franchisees (including, but not limited to, area development contracts owned made by Franchisees) Loan Parties in the ordinary course of business to or otherwise in an amount not exceeding $60,000,000, so long any Foreign Subsidiary to provide funds as (A) no Event of Default shall have occurred and be continuing and (B) the Borrower is in pro forma compliance with the Financial Covenant after giving effect necessary to any such purchase;
(z) So long as no Event of Default shall have occurred and be continuing, Investments in Franchisees (including, but not limited to, (i) Guarantees or other credit support of any Indebtedness and other liabilities thereof and (ii) loans, advances or contributions to the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater of $20,000,000 and 70% of Consolidated EBITDA;
(aa) Investments consisting of accounts and payment intangibles owing to the Borrower or any of the Restricted Subsidiaries from Franchisees; provided that such obligation shall be on such terms as the Borrower or enable the applicable Restricted Foreign Subsidiary establishes to comply with changes in good faith; and
statutory or contractual capital requirements (bb) Investments consisting other than any contractual requirement that constitutes a Guarantee). Notwithstanding anything contrary set forth above, if any Investment is denominated in a foreign currency, no fluctuation in currency values shall result in a breach of advances or expenditures by any Loan Party to, or on behalf of, any CMF Subsidiary in support of advertising and marketing programs in the ordinary course consistent with current practicesthis Section 6.04. For purposes of determining compliance with this Section 6.04, in the event that an Investment (or any item of portion thereof) (other than any Investment made pursuant to clause (t) above) meets the criteria of more than one of the categories of permitted Investments described in clauses (a) through (bb) (but excluding clause (t)) above, Holdings shallthe Company, in its sole discretion, will be permitted to divide and classify and reclassify or later divide, classify or reclassify such Investment (or any portion thereof) on the date of incurrence, and will only be required at any time and from time to include the amount and type time may later reclassify all or any portion of any Investment as having been incurred under any category of permitted Investments described in clauses (a) through (bb) (but excluding clause (t)) above so long as such Investment in one or more is permitted to be incurred pursuant to such provision at the time of the above clausesreclassification.
Appears in 1 contract
Samples: Credit Agreement (MTS Systems Corp)
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor the The Borrower willwill not, nor will they it permit any Restricted Subsidiary or Intermediate Parent to, make or hold any Investment, except:
(a) Permitted Investments at the time such Permitted Investment is made;
(b) loans or advances to present or former officers, directors directors, managers, members of management, consultants, independent contractors and employees of Holdings, any Intermediate Parent, the Borrower and the Restricted Subsidiaries (i) for reasonable and customary business-related travel, entertainment, relocation and analogous ordinary business purposes, (ii) in connection with such Person’s purchase of Equity Interests in Holdings (or any direct or indirect parent thereof) the Borrower (provided that the amount of such loans and advances made in cash to such Person shall be contributed to the Borrower in cash as common equity or Qualified Equity Interests) and (iii) for purposes not described in the foregoing clauses (i) and (ii); provided that at the time of incurrence thereof and after giving Pro Forma Effect pro 103 forma effect thereto, the aggregate principal amount outstanding in reliance on this clause (iii) shall not exceed $1,000,0005,000,000;
(c) Investments (i) by Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary in any Loan Party; provided that to the extent the aggregate amount of HoldingsInvestments by a Restricted Subsidiary that is not a Loan Party in a Loan Party exceeds $1,000,000, such non-Loan Party Restricted Subsidiary shall have acceded to the Pari Passu Intercreditor Agreement pursuant to the terms thereof, (ii) by any Intermediate ParentRestricted Subsidiary that is not a Loan Party in any other Restricted Subsidiary that is also not a Loan Party, (iii) subject to the proviso in clause (c)(i) of this Section 6.04, by the Borrower or any Restricted Subsidiary (A) in any Restricted Subsidiary; provided that (x) the aggregate outstanding amount of such Investments made by Loan Parties after the Effective Date in Restricted Subsidiaries that are not Loan Parties in reliance on this clause (iii)(A), together with the aggregate amount of (x) all other Investments made in and Dispositions made to Restricted Subsidiaries that are not Loan Parties by any Loan Parties after the Effective Date and (y) all Investments and Dispositions made in reliance on Section 6.16(ii), shall not exceed, at the time of the making thereof and after giving pro forma effect thereto, $7,500,000, (y) no Event of Default has occurred and is continuing and (z) all Investments made by Loan Parties in Restricted Subsidiaries that are not Loan Parties in reliance on this clause (ciii)(A) shall be made only for the purpose of financing working capital needs of such non Loan Parties or another purpose agreed to by the Required Lenders (such consent not exceed to be unreasonably withheld, conditioned or delayed; provided, that it is acknowledged and agreed that it shall not be unreasonable to withhold consent to any such transaction that will have a material adverse impact on the greater Guarantees or the Collateral) and shall be evidenced by an intercompany note that has been pledged as Collateral, (B) [reserved] or (C) constituting Guarantees of $10,000,000 Indebtedness or other monetary obligations of Restricted Subsidiaries that are not Loan Parties owing to any Loan Party, (iv) by the Borrower or any Restricted Subsidiary in Restricted Subsidiaries that are not Loan Parties so long as such transaction is part of a series of simultaneous transactions that results in the proceeds of the initial Investment being invested in one or more Loan Parties, (v) subject to the consent of the Required Lenders (such consent not to be unreasonably withheld, conditioned or delayed; provided, that it is acknowledged and 35% agreed that it shall not be unreasonable to withhold consent to any such transaction that will have a material adverse impact on the Guarantees or the Collateral), by the Borrower or any Restricted Subsidiary in any Restricted Subsidiary that is not a Loan Party, consisting of Consolidated EBITDAthe contribution of Equity Interests of any other Restricted Subsidiary that is not a Loan Party so long as the Equity Interests of the transferee Restricted Subsidiary is pledged to secure the Secured Obligations;
(d) Investments consisting of deposits, prepayments and/or other credits to suppliers in the ordinary course of business;
(e) Investments consisting of extensions of trade credit in the ordinary course of business;
(f) Investments (i) existing or contemplated on the date hereof and set forth on Schedule 6.04(f) and any modification, replacement, renewal, reinvestment or extension thereof and (ii) Investments existing on the date hereof Effective Date by Holdings, the Borrower or any Restricted Subsidiary in the Borrower or any Restricted Subsidiary and any modification, renewal or extension thereof; provided that the amount of the original Investment is not increased except by the terms of such Investment to the extent as set forth on Schedule 6.04(f) or as otherwise permitted by this Section 6.04;
(g) Investments in Swap Agreements permitted under Section 6.01(a)(vi)6.01;
(h) promissory notes and other non-cash consideration received in connection with Dispositions permitted by Section 6.05;; 104
(i) Permitted AcquisitionsInvestments made in connection with the Transactions (other than borrowings under the ABL Credit Agreement);
(j) subject to the Transactionsconsent of the Required Lenders (such consent not to be unreasonably withheld, conditioned or delayed; provided, that it is acknowledged and agreed that it shall not be unreasonable to withhold consent to any such transaction that will have a material adverse impact on the Guarantees or the Collateral), Investments made by any Loan Party in any non-Loan Party consisting of contributions or other Dispositions of Equity Interests of Persons that are non-Loan Parties; provided that, prior to such contribution or Disposition, such Equity Interests were not owned directly by a Loan Party or such Equity Interests are contributed or disposed to a Non-Loan Party that is a wholly owned Restricted Subsidiary of a Loan Party;
(k) Investments in the ordinary course of business consisting of endorsements for collection or deposit and customary trade arrangements with customers consistent with past practices;
(l) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers and customers, from financially troubled account debtors or in settlement of delinquent obligations of, or other disputes with, customers and suppliers or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment;
(m) loans subject to the consent of the Required Lenders (such consent not to be unreasonably withheld, conditioned or delayed; provided, that it is acknowledged and advances agreed that it shall not be unreasonable to Holdings withhold consent to any such transaction that will have a material adverse impact on the Guarantees or the Collateral), cash or property distributed from any Restricted Subsidiary that is not a Loan Party (or any direct or indirect parent thereofi) or any Intermediate Parent in lieu ofmay be contributed to other Restricted Subsidiaries that are not Loan Parties, and (ii) may pass through the Borrower and/or any intermediate Restricted Subsidiaries, so long as part of a series of related transactions and such transaction steps are not in excess of the amount of (after giving effect to any other loans, advances or Restricted Payments in respect thereof), Restricted Payments to the extent unreasonably delayed and are otherwise permitted to be made to Holdings (or such parent) or such Intermediate Parent in accordance with Section 6.08(a)hereunder;
(n) from and after the Second Additional Funding Date, additional Investments and other acquisitionsacquisitions made and held by the Loan Parties; provided that at the time any such Investment or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition made in reliance on this clause (n), together with (including the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (n)), whether in the form of Indebtedness assumed or otherwise), shall not exceed the sum of (A) the greater of $18,000,000 and 60% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Investment or other acquisition, plus (B) so long as no Event of Default has occurred and is continuing, the Available Amount that is Not Otherwise Applied as in effect immediately prior to at the time of making incurrence thereof and after giving pro forma effect thereto, $2,500,000; provided that (x) the aggregate amount of such InvestmentInvestments made by Loan Parties after the Effective Date in Restricted Subsidiaries that are not Loan Parties in reliance on this clause (n), together with the aggregate amount of (x) all other Investments made in and Dispositions made to Restricted Subsidiaries that are not Loan Parties by Loan Parties after the Effective Date and (y) all Investments and Dispositions made in reliance on Section 6.16(ii), shall not exceed, at the time of the making thereof and after giving pro forma effect thereto, $7,500,000 at any time outstanding and (y) all Investments made by Loan Parties in Restricted Subsidiaries that are not Loan Parties in reliance on this clause (n) shall be made only for the purpose of financing working capital needs of such non Loan Parties or another purpose agreed to by the Required Lenders (such consent not to be unreasonably withheld, conditioned or delayed; provided, that it is acknowledged and agreed that it shall not be unreasonable to withhold consent to any such transaction that will have a material adverse impact on the Guarantees or the Collateral) and shall be evidenced by an intercompany note that has been pledged as Collateral;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby;[reserved]; 105
(p) advances of payroll payments to employees in the ordinary course of business;
(q) Investments and other acquisitions to the extent that payment for such Investments is made with Qualified Equity Interests (excluding Cure Amounts) of Holdings (or any direct or indirect parent thereof or the IPO Entity)Borrower; provided that (i) such amounts used pursuant to this clause (q) shall not increase the Available Amount and (ii) any other amounts used for such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof or the IPO Entity) Borrower shall otherwise be permitted pursuant to this Section 6.04;
(r) Investments of a Subsidiary acquired after the Effective Date or of a Person merged or consolidated with any Subsidiary in accordance with this Section and Section 6.03 after the Effective Date to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger or consolidation and were in existence on the date of such acquisition, merger or consolidation[reserved];
(s) non-cash Investments in connection with tax planning and reorganization activities; provided that after giving effect to any such activities, the security interests of the Lenders in the Collateral, taken as a whole, would not be materially impaired[reserved];
(t) Investments consisting of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference to this Section 6.04(t)) under Sections 6.01, 6.02, 6.03, 6.05 and 6.08, respectively;
(u) additional Investments; provided that after giving effect to such Investment (A) on a Pro Forma Basis, the Total Net Leverage Ratio is less than or equal to 4.50 to 1.00 and (B) there is no continuing Event of Default[reserved];
(v) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers of the Borrower or any Restricted Subsidiary or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the Borrower;
(w) to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Property, or other rights, in each case in the ordinary course of business;
(x) Investments by an Unrestricted Subsidiary entered into prior to the day such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to the definition of “Unrestricted Subsidiary”[reserved];
(y) Investments consisting of purchases of assets of Franchisees (including, but not limited to, area development contracts owned by Franchisees) in the ordinary course of business or otherwise in an amount not exceeding $60,000,000, so long as (A) no Event of Default shall have occurred and be continuing and (B) the Borrower is in pro forma compliance with the Financial Covenant after giving effect to any such purchase[reserved];
(z) So long as no Event of Default shall have occurred and be continuing, Investments in Franchisees (including, but not limited to, (i) Guarantees or other credit support of any Indebtedness and other liabilities thereof and (ii) loans, advances or contributions to the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater of $20,000,000 and 70% of Consolidated EBITDA[reserved];
(aa) Investments consisting of accounts and payment intangibles owing to the Borrower or any of the Restricted Subsidiaries from Franchisees; provided that such obligation shall be on such terms as the Borrower or the applicable Restricted Subsidiary establishes in good faith[reserved]; and
(bb) Investments consisting unfunded pension fund and other employee benefit plan obligations and liabilities to the extent that the same are permitted to remain unfunded under applicable Requirements of advances or expenditures by any Loan Party to, or on behalf of, any CMF Subsidiary in support of advertising and marketing programs in the ordinary course consistent with current practices. For purposes of determining compliance with this Section 6.04, in the event that any item of Investment meets the criteria of more than one of the categories of Investments described in clauses (a) through (bb) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such Investment (or any portion thereof) and will only be required to include the amount and type of such Investment in one or more of the above clausesLaw.
Appears in 1 contract
Samples: Amendment Agreement and Joinder to Foreign Guarantee Agreement (Invacare Corp)
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor the Borrower No Specified Loan Party will, nor or will they permit any Restricted Subsidiary or any Intermediate Parent to, make or hold any Investment, except:
(a) Permitted Investments at the time such Permitted Investment is madecash and Cash Equivalents;
(b) loans or advances to officers, directors and employees of Holdings, any Intermediate Parent, the Borrower Holdings and the its Restricted Subsidiaries (i) for reasonable and customary business-related travel, entertainment, relocation and analogous ordinary business purposes, (ii) in connection with such Person’s purchase of Equity Interests in of Holdings (or any direct or indirect parent thereof) (provided that the amount of such loans and advances NAI-1532775236v11532775236v9 119 Blue Bird Body Company Credit Agreement made in cash to such Person shall be contributed to the Borrower in cash as common equity or Qualified Equity Interests) and (iii) for purposes not described in the foregoing clauses (i) and (ii); provided that , in an aggregate principal amount outstanding at any time (excluding any paid in kind capitalized interest in respect thereof) not to exceed $5,000,000 (as determined at the time of incurrence thereof and after giving Pro Forma Effect thereto, the aggregate principal amount outstanding in reliance on this clause (iii) shall not exceed $1,000,000such Investment);
(c) Investments (i) by Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary in any of Loan Party, (ii) by any Restricted Subsidiary that is not a Loan Party in any other Restricted Subsidiary that is also not a Loan Party and (iii) by Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary; provided Subsidiary that the aggregate outstanding amount is not a Loan Party, constituting an exchange of Investments made by Loan Parties in Equity Interests of such Restricted Subsidiary for Indebtedness of such Restricted Subsidiary or constituting Guarantees of Indebtedness or other monetary obligations of Restricted Subsidiaries that are not Loan Parties in reliance on this clause (c) shall not exceed the greater of $10,000,000 and 35% of Consolidated EBITDAowing to any Loan Party;
(d) Investments consisting of prepayments to suppliers in the ordinary course of business;
(e) Investments consisting of extensions of trade credit in the ordinary course of business;
(f) Investments (i) existing or contemplated on the date hereof and set forth on Schedule 6.04(f6.04(d) and any modification, replacement, renewal, reinvestment or extension thereof and (ii) Investments existing on the date hereof by Holdings, the Borrower or any Restricted Subsidiary in the Borrower or any Restricted Subsidiary and any modification, renewal or extension thereof; provided that that, in each case, the amount of the original Investment is not increased except by the terms of such Investment to the extent as set forth on Schedule 6.04(f6.04(d) or as otherwise permitted by this Section 6.04;
(ge) Investments in Swap Agreements permitted under Section 6.01(a)(vi);
(hf) promissory notes and other non-cash consideration received in connection with Dispositions permitted by Section 6.05;
(ig) Permitted Acquisitions; provided that the aggregate amount of cash consideration paid or provided by any Loan Party or any Restricted Subsidiary after the Closing Date in reliance on this Section 6.04(g) (together with any Investments made in Restricted Subsidiaries that are not Loan Parties pursuant to Section 6.04(m)) for Permitted Acquisitions (including the aggregate principal amount of all Indebtedness assumed in connection with Permitted Acquisitions) for any Restricted Subsidiary that shall not be or, after giving effect to such Permitted Acquisition, shall not become a Loan Party (or for assets that are not purchased by, or promptly contributed to, a Loan Party), shall not exceed the Non-Loan Party Investment Amount at such time (as determined at the time of such Investment);
(j) the Transactions;
(k) Investments in the ordinary course of business consisting of endorsements for collection or deposit and customary trade arrangements with customers consistent with past practices;
(lh) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers and customers, from financially troubled account debtors customers or in settlement of delinquent obligations of, or other disputes with, customers and suppliers or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment;
(mi) loans and advances to Holdings (or any direct or indirect parent thereof) or any Intermediate Parent in lieu of, and not in excess of the amount of (after giving effect to any other loans, advances or Restricted Payments in respect thereof), Restricted Payments to the extent permitted to be made to Holdings (or such parent) or such Intermediate Parent in accordance with Section 6.08(a6.06(a)(iv);
(nj) additional so long as no Event of Default shall have occurred and be continuing, other Investments and other acquisitionsby the Borrower or any Restricted Subsidiary; provided that at the time any such Investment or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition all Investments made in reliance on this NAI-1532775236v11532775236v9 120 Blue Bird Body Company Credit Agreement clause (n), together with the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (n), j) shall not exceed the sum of (A) the greater of $18,000,000 and 60% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Investment or other acquisition, plus (B) so long as no Event of Default has occurred and is continuing, the Available Amount that is Not Otherwise Applied at such time (excluding any paid in kind capitalized interest in respect thereof and as in effect immediately prior to determined at the time of making of such Investment);
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby;
(pk) advances of payroll payments to employees in the ordinary course of business;
(ql) so long as no Event of Default shall have occurred and be continuing or would result therefrom and the Borrower shall be in compliance with the Financial Performance Covenant after giving Pro Forma Effect thereto, Investments and other acquisitions to the extent that payment for such Investments is made solely with Qualified Equity Interests (excluding Cure Amounts) of Holdings (or any direct or indirect parent thereof thereof);
(m) acquisitions of, Investments in, and loans and advances to, joint ventures and Unrestricted Subsidiaries by the Borrower and its Restricted Subsidiaries, so long as the aggregate amount invested, loaned or the IPO Entity); provided that (i) such amounts used pursuant to this clause (q) shall not increase the Available Amount and (ii) any amounts used for such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof or the IPO Entity) shall otherwise be permitted advanced pursuant to this Section 6.046.04(m) (determined without regard to any write-downs or write-offs of such investments, loans or advances), together with any Investments made in Restricted Subsidiaries that are not Loan Parties pursuant to Section 6.04(g), does not exceed the Non-Loan Party Investment Amount at such time (excluding any paid in kind capitalized interest in respect thereof and as determined at the time of such Investment);
(rn) Investments the licensing, sublicensing or contribution of a Subsidiary acquired after rights in any Intellectual Property pursuant to joint marketing arrangements with Persons other than Holdings and its Restricted Subsidiaries in the Effective Date or ordinary course of a Person merged or consolidated with any Subsidiary in accordance with this Section and Section 6.03 after the Effective Date to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger or consolidation and were in existence on the date of such acquisition, merger or consolidationbusiness;
(so) non-cash Investments in connection Restricted Subsidiaries of Borrower may be established or created if the Borrower and such Restricted Subsidiary comply with tax planning and reorganization activities; provided that after giving effect to any such activitiesthe requirements of Section 5.11, the security interests of the Lenders in the Collateral, taken as a whole, would not be materially impairedif applicable;
(t) Investments consisting of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference to this Section 6.04(t)) under Sections 6.01, 6.02, 6.03, 6.05 and 6.08, respectively;
(u) additional Investments; provided that after giving effect to such Investment (A) on a Pro Forma Basis, the Total Net Leverage Ratio is less than or equal to 4.50 to 1.00 and (B) there is no continuing Event of Default;
(v) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the Borrower;
(wp) to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials or and equipment or purchases, acquisitions, purchases of contract rights or licenses or leases of other assets, Intellectual Property, or other rightsintellectual property, in each case in the ordinary course of business;
(xq) Investments by an Unrestricted Subsidiary entered into prior in negotiable instruments deposited or to be deposited for collection in the day such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to the definition ordinary course of “Unrestricted Subsidiary”business;
(yr) Investments consisting of advances made in connection with purchases of assets goods or services in the ordinary course of Franchisees business;
(including, but not limited to, area development contracts owned by Franchiseess) deposits of cash made in the ordinary course of business or otherwise in an amount not exceeding $60,000,000, so long as (A) no Event to secure performance of Default shall have occurred and be continuing and (B) the Borrower is in pro forma compliance with the Financial Covenant after giving effect to any such purchaseoperating leases;
(zt) So long as no Event of Default shall have occurred and be continuing, guarantees permitted under Section 6.01(a);
(u) Investments held by a Person acquired in Franchisees (including, but not limited to, (i) Guarantees or other credit support of any Indebtedness and other liabilities thereof and (ii) loans, advances or contributions a Permitted Acquisition to the marketing and advertising funds operating extent that such Investments were not made in contemplation of or in connection with such Permitted Acquisition and were in existence on the European Wax Center franchise systemsdate of such Permitted Acquisition;
(v) Investments resulting from entering into Secured Cash Management Obligations; and NAI-1532775236v11532775236v9 121 Blue Bird Body Company Credit Agreement
(w) other Investments by Holdings or any Restricted Subsidiary not to exceed, in the aggregate, at any time outstanding, (excluding any paid in kind capitalized interest in respect thereof) not to exceed $5,000,000 (as determined at the greater time of $20,000,000 and 70% of Consolidated EBITDA;
(aa) Investments consisting of accounts and payment intangibles owing such Investment). Notwithstanding anything to the Borrower or any contrary contained herein, the total amount of the Restricted Subsidiaries from Franchisees; provided that such obligation shall Investments permitted to be on such terms as the Borrower or the applicable Restricted Subsidiary establishes in good faith; and
made under clauses (bbb), (g), (i), (j), (l), (m), (u) Investments consisting and (w) of advances or expenditures by any Loan Party to, or on behalf of, any CMF Subsidiary in support of advertising and marketing programs in the ordinary course consistent with current practices. For purposes of determining compliance with this Section 6.046.04 during the Limited Availability Period shall not exceed, in the event that any item of Investment meets aggregate, the criteria of more than one of the categories of Investments described in clauses (a) through (bb) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such Investment (or any portion thereof) and will only be required to include the amount and type of such Investment in one or more of the above clausesLimited Availability Covenant Cap.
Appears in 1 contract
Samples: Credit Agreement (Blue Bird Corp)
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor The Parent and the Borrower willwill not, nor and will they not permit any Restricted Subsidiary or Intermediate Parent to, of the Subsidiaries to make or hold any Investment, Investment except:
(a) Permitted Investments at the time such Permitted Investment is madeInvestments;
(b) loans or advances to officers, directors and employees of Holdings, any Intermediate Investments by the Parent, the Borrower and the Restricted Subsidiaries (i) for reasonable and customary business-related travel, entertainment, relocation and analogous ordinary business purposes, (ii) in connection with such Person’s purchase of Equity Interests in Holdings their respective subsidiaries (or other than Investments by any direct or indirect parent thereof) (Loan Party in any Person that is not a Loan Party), provided that the amount of any such loans and advances made in cash to such Person Equity Interests held by a Loan Party shall be contributed pledged to the Borrower Administrative Agent as collateral security for the obligations of the Loan Parties under the Loan Documents pursuant to the Security Documents (subject to the limitations applicable to Foreign Subsidiary Equity Interests referred to in cash as common equity or Qualified Equity Interests) and (iii) for purposes not described in the foregoing clauses (i) and (iiSection 4.01(f)(i); provided that at the time of incurrence thereof and after giving Pro Forma Effect thereto, the aggregate principal amount outstanding in reliance on this clause (iii) shall not exceed $1,000,000);
(c) Investments loans or advances made by Holdings, any Intermediate the Parent, the Borrower or any Restricted Subsidiary in any of Holdings, any Intermediate Loan Party to the Parent, the Borrower or any Restricted Subsidiary; Subsidiary Loan Party, provided that the aggregate outstanding amount of Investments any such loans and advances made by a Loan Party shall be evidenced by a promissory note pledged to the Administrative Agent as collateral security for the obligations of the Loan Parties in Restricted Subsidiaries that are not under the Loan Parties in reliance on this clause (c) shall not exceed Documents pursuant to the greater of $10,000,000 and 35% of Consolidated EBITDASecurity Documents;
(d) Investments consisting (i) Guarantees constituting Indebtedness permitted by Section 6.01, provided that no Subsidiary shall guarantee Permitted Additional Indebtedness unless, if applicable, such guaranty is subordinated to the Obligations on the same terms as such Indebtedness and (ii) Guarantees by the Parent, the Borrower or any Subsidiary of prepayments to suppliers in the ordinary course obligations (other than Indebtedness) of businessthe Parent, the Borrower or any Subsidiary;
(e) Investments consisting of extensions of trade credit in the ordinary course of business;
(f) Investments (i) existing or contemplated on the date hereof and set forth on Schedule 6.04(f) and any modification, replacement, renewal, reinvestment or extension thereof and (ii) Investments existing on the date hereof by Holdings, the Borrower or any Restricted Subsidiary in the Borrower or any Restricted Subsidiary and any modification, renewal or extension thereof; provided that the amount of the original Investment is not increased except by the terms of such Investment to the extent as set forth on Schedule 6.04(f) or as otherwise permitted by this Section 6.04;
(g) Investments in Swap Agreements permitted under Section 6.01(a)(vi);
(h) promissory notes and other non-cash consideration received in connection with Dispositions permitted by Section 6.05;
(i) Permitted Acquisitions;
(j) the Transactions;
(k) Investments in the ordinary course of business consisting of endorsements for collection or deposit and customary trade arrangements with customers consistent with past practices;
(l) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers and customersof, from financially troubled account debtors or in settlement of delinquent obligations of, or other accounts and disputes with, customers and suppliers or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment;
(m) loans and advances to Holdings (or any direct or indirect parent thereof) or any Intermediate Parent in lieu of, and not in excess of the amount of (after giving effect to any other loans, advances or Restricted Payments in respect thereof), Restricted Payments to the extent permitted to be made to Holdings (or such parent) or such Intermediate Parent in accordance with Section 6.08(a);
(n) additional Investments and other acquisitions; provided that at the time any such Investment or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition made in reliance on this clause (n), together with the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (n), shall not exceed the sum of (A) the greater of $18,000,000 and 60% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Investment or other acquisition, plus (B) so long as no Event of Default has occurred and is continuing, the Available Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of such Investment;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby;
(p) advances of payroll payments to employees in the ordinary course of business;
(q) Investments and other acquisitions to the extent that payment for such Investments is made with Qualified Equity Interests (excluding Cure Amounts) of Holdings (or any direct or indirect parent thereof or the IPO Entity); provided that (i) such amounts used pursuant to this clause (q) shall not increase the Available Amount and (ii) any amounts used for such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof or the IPO Entity) shall otherwise be permitted pursuant to this Section 6.04;
(r) Investments of a Subsidiary acquired after the Effective Date or of a Person merged or consolidated with any Subsidiary in accordance with this Section and Section 6.03 after the Effective Date to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger or consolidation and were in existence on the date of such acquisition, merger or consolidation;
(s) non-cash Investments in connection with tax planning and reorganization activities; provided that after giving effect to any such activities, the security interests of the Lenders in the Collateral, taken as a whole, would not be materially impaired;
(t) Investments consisting of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference to this Section 6.04(t)) under Sections 6.01, 6.02, 6.03, 6.05 and 6.08, respectively;
(u) additional Investments; provided that after giving effect to such Investment (A) on a Pro Forma Basis, the Total Net Leverage Ratio is less than or equal to 4.50 to 1.00 and (B) there is no continuing Event of Default;
(v) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the Borrower;
(w) to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Property, or other rightssuppliers, in each case in the ordinary course of business;
(xf) Investments by an Unrestricted Subsidiary entered into prior to Permitted Acquisitions, provided that the day aggregate Purchase Prices of all Permitted Acquisitions under this clause (f) shall not exceed the sum of (i) $150,000,000100,000,000 plus (ii) the Available Equity Issuance Amounts as at such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary date plus (iii) the aggregate amount subtracted in the calculation of such Available Equity Issuance Amount pursuant to clause (b)(i)(x) of the definition of “Unrestricted Subsidiary”such term, and at the time of such Permitted Acquisition, the Borrower shall deliver a certificate of a Financial Officer setting forth the foregoing calculations and setting forth a calculation of the Available Equity Issuance Amount immediately before and immediately after such Permitted Acquisition;
(yg) Investments consisting of purchases of assets of Franchisees (includingloans and advances to employees, but not limited to, area development contracts owned by Franchisees) directors or consultants in the ordinary course of business (including, without limitation, for travel, entertainment and relocation expenses and temporary advances to employees or otherwise directors in respect of income taxes related to the exercise of stock options) to the extent permitted under the Xxxxxxxx-Xxxxx Act of 2002, as amended, in an aggregate principal amount not exceeding to exceed $60,000,0005,000,000 at any one time outstanding;
(h) Investments by the Parent, the Borrower and the Subsidiaries in Hedging Agreements permitted under Section 6.07;
(i) extensions of trade credit or the holding of receivables owing to the Parent, the Borrower or any Subsidiary if created or acquired in the ordinary course of business;
(j) payroll, travel and similar advances to cover matters that are expected at the time of such advances ultimately to be treated as expenses for accounting purposes and that are made in the ordinary course of business;
(k) Investments that are financed or acquired with Equity Interests of the Parent;
(l) Investments set forth on, or made pursuant to agreements described on, Schedule 6.04 (and other investments received in respect thereof without the payment of additional cash consideration);
(m) Investments made with Net Proceeds to the extent permitted to be so applied or reinvested as set forth in the definition of Prepayment Event;
(n) Investments received as consideration in connection with sales, transfers or other dispositions permitted under this Agreement;
(o) so long as no Default or Restricted Period has occurred and is continuing, other Investments, the amount of which is deducted from Available Cash for the Relevant Period in which made pursuant to clause (iv) of the definition of such term in Section 1.01, in an aggregate amount not to exceed the amount of Cumulative Distributable Cash at such time, provided that, after April 10, 2011, no Investment shall be made under this clause (o) prior to the date 5 days after the Borrower shall have delivered to the Administrative Agent a certificate of a Financial Officer stating the amount of such Investment to be made pursuant to this clause (o) and demonstrating that the sum of (A) no Event Cumulative Distributable Cash through the most recent fiscal quarter as of Default shall which financial statements have occurred and be continuing and been delivered to the Lenders under Section 5.01 minus (B) the Borrower amount of such Investment, is in pro forma compliance with the Financial Covenant after giving effect to any such purchasegreater than zero;
(zp) So so long as no Default or Restricted Period has occurred and is continuing, other Investments in an aggregate amount not to exceed the Available Equity Issuance Amount at such time, provided that at the time of any Investment under this clause (p), the Borrower shall deliver a certificate of a Financial Officer stating the amount of the Investment being made pursuant to this clause (p) and setting forth a calculation of the Available Equity Issuance Amount immediately before and immediately after such Investment; and
(q) Investments in joint ventures (including, for the avoidance of doubt, joint ventures in corporate, partnership or limited liability company form) in an aggregate amount not to exceed $10,000,000 so long as both immediately before and after giving pro forma effect thereto no Default or Event of Default shall have occurred and be continuing, Investments in Franchisees (including, but not limited to, (i) Guarantees or other credit support of any Indebtedness and other liabilities thereof and (ii) loans, advances or contributions to the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater of $20,000,000 and 70% of Consolidated EBITDA;
(aa) Investments consisting of accounts and payment intangibles owing to the Borrower or any of the Restricted Subsidiaries from Franchisees; provided that such obligation shall be on such terms as the Borrower or the applicable Restricted Subsidiary establishes in good faith; and
(bb) Investments consisting of advances or expenditures by any Loan Party to, or on behalf of, any CMF Subsidiary in support of advertising and marketing programs in the ordinary course consistent with current practices. For purposes of determining compliance with this Section 6.04, in the event that any item of Investment meets the criteria of more than one of the categories of Investments described in clauses (a) through (bb) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such Investment (or any portion thereof) and will only be required to include the amount and type of such Investment in one or more of the above clauses.
Appears in 1 contract
Samples: Credit Agreement (Alaska Communications Systems Group Inc)
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor the The Borrower willwill not, nor will they it permit any Restricted Subsidiary or Intermediate Parent to, of its Subsidiaries to make or hold any Investment, except:
(a) Permitted Investments at the time such Permitted Investment is madeInvestments;
(b) loans or advances to officers, directors and employees of Holdings, any Intermediate Parent, the Borrower and the Restricted its Subsidiaries (i) in an aggregate principal amount outstanding at any time not to exceed $500,000 for reasonable and customary business-related travel, entertainment, relocation and analogous ordinary business purposes, (ii) in connection with such Person’s purchase of Equity Interests in Holdings (or any direct or indirect parent thereof) (provided that the amount of such loans and advances made in cash to such Person shall be contributed to the Borrower in cash as common equity or Qualified Equity Interests) and (iii) for purposes not described in the foregoing clauses (i) and (ii); provided that at the time of incurrence thereof and after giving Pro Forma Effect thereto, the aggregate principal amount outstanding in reliance on this clause (iii) shall not exceed $1,000,000;
(c) Investments (i) by Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary of its Subsidiaries in any of HoldingsLoan Party (excluding any new Subsidiary that becomes a Loan Party pursuant to such Investment), (ii) by any Intermediate ParentSubsidiary that is not a Loan Party in any other Subsidiary that is also not a Loan Party, (iii) by the Borrower or any Restricted of its Subsidiaries (A) in any Subsidiary; provided that the aggregate outstanding amount of such Investments made by Loan Parties after the Effective Date in Restricted Subsidiaries that are not Loan Parties in reliance on this clause (ciii)(A) (together with the amount of Investments made in Subsidiaries that are not Loan Parties pursuant to Sections 6.04(h) and 6.04(n)) shall not exceed the greater Non-Loan Party Investment Amount at the time of $10,000,000 any such Investment, (B) in any Subsidiary that is not a Loan Party, constituting an exchange of Equity Interests of such Subsidiary for Indebtedness of such Subsidiary or (C) constituting Guarantees of Indebtedness or other monetary obligations of Subsidiaries that are not Loan Parties owing to any Loan Party, (iv) by the Borrower or any of its Subsidiaries in Subsidiaries that are not Loan Parties so long as such Investment is part of a series of simultaneous Investments that result in the proceeds of the initial Investment being invested in one or more Loan Parties and 35% (v) by the Borrower or any of Consolidated EBITDAits Subsidiaries in any Subsidiary that is not a Loan Party, consisting of the contribution of Equity Interests of any other Subsidiary that is not a Loan Party so long as the Equity Interests of the transferee Subsidiary is pledged to secure the Secured Obligations;
(d) Investments consisting of prepayments to suppliers in the ordinary course of business;
(e) Investments consisting of extensions of trade credit in the ordinary course of business;
(fe) Investments (i) existing or contemplated on the date hereof and set forth on Schedule 6.04(f6.04(e) to the Disclosure Letter and any modification, replacement, renewal, reinvestment or extension thereof and (ii) Investments existing on the date hereof by Holdings, the Borrower or any Restricted Subsidiary in the Borrower or any Restricted Subsidiary and any modification, renewal or extension thereof; provided that the amount of the original Investment is not increased except by the terms of such Investment to the extent as set forth on Schedule 6.04(f6.04(e) to the Disclosure Letter or as otherwise permitted by this Section 6.04;
(gf) Investments in Swap Agreements permitted under Section 6.01(a)(vi6.01(vi);
(hg) promissory notes and other non-cash consideration received in connection with Dispositions permitted by Section 6.05;
(ih) Permitted Acquisitions; provided that the aggregate amount of cash and non-cash consideration paid or provided by the Borrower or any other Loan Party after the Effective Date in reliance on this Section 6.04(h) (together with any Investments made in Subsidiaries that are not Loan Parties pursuant to Sections 6.04(c)(iii)(A) and 6.04(n)) for Permitted Acquisitions (including the aggregate principal amount of all Indebtedness assumed in connection with Permitted Acquisitions) for any Subsidiary that shall not be or, after giving effect to such Permitted Acquisition, shall not become a Loan Party, shall not exceed the Non-Loan Party Investment Amount at such time;
(i) extensions of credit and guarantees permitted by Section 6.01 and Restricted Payments permitted by Section 6.06;
(j) the Transactions;
(k) Investments in the ordinary course of business consisting of Uniform Commercial Code Article 3 endorsements for collection or deposit and Uniform Commercial Code Article 4 customary trade arrangements with customers consistent with past practices;
(lk) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers and customers, from financially troubled account debtors customers or in settlement of delinquent obligations of, or other disputes with, customers and suppliers in the ordinary course of business or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured InvestmentInvestment in the ordinary course of business;
(m) loans and advances to Holdings (or any direct or indirect parent thereof) or any Intermediate Parent in lieu of, and not in excess of the amount of (after giving effect to any other loans, advances or Restricted Payments in respect thereof), Restricted Payments to the extent permitted to be made to Holdings (or such parent) or such Intermediate Parent in accordance with Section 6.08(a);
(n) additional Investments and other acquisitions; provided that at the time any such Investment or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition made in reliance on this clause (n), together with the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (n), shall not exceed the sum of (A) the greater of $18,000,000 and 60% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Investment or other acquisition, plus (B) so long as no Event of Default has occurred and is continuing, the Available Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of such Investment;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby;
(pl) advances of payroll payments to employees in the ordinary course of business;
(q) Investments and other acquisitions to the extent that payment for such Investments is made with Qualified Equity Interests (excluding Cure Amounts) of Holdings (or any direct or indirect parent thereof or the IPO Entity); provided that (i) such amounts used pursuant to this clause (q) shall not increase the Available Amount and (ii) any amounts used for such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof or the IPO Entity) shall otherwise be permitted pursuant to this Section 6.04;
(rm) Investments of a Subsidiary acquired after the Effective Date or of a Person merged merged, amalgamated or consolidated with any Subsidiary in accordance with this Section and Section 6.03 after the Effective Date to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger merger, amalgamation or consolidation and were in existence on the date of such acquisition, merger merger, amalgamation or consolidation;
(n) acquisitions of, investments in, and loans and advances to, joint ventures and other Persons by the Borrower and its Subsidiaries in lines of business which, in the good faith judgment of the Borrower, is reasonably related to, or is a reasonable extension of, that of the Borrower and its Subsidiaries, so long as the aggregate amount invested, loaned or advanced pursuant to this Section 6.04(n) (determined without regard to any write-downs or write-offs of such investments, loans or advances), together with any Investments made in Subsidiaries that are not Loan Parties pursuant to Sections 6.04(c)(iii)(A) and 6.04(h), does not exceed the Non-Loan Party Investment Amount at such time;
(o) the licensing, sublicensing or contribution of rights in any Intellectual Property pursuant to joint marketing, distribution, or development arrangements with Persons other than the Borrower and its Subsidiaries in the ordinary course of business;
(p) Investments to the extent that payment for such Investments is made solely by the issuance of Equity Interests (other than Disqualified Equity Interests) of the Borrower (or any Parent Entity) to the seller of such Investments;
(q) any Investments in a Subsidiary that is not a Loan Party or in a joint venture, in each case, to the extent such Investment is contemporaneously repaid in full with a dividend or other distribution from such Subsidiary or joint venture;
(r) the forgiveness or conversion to Equity Interests of any Indebtedness owed by a Loan Party and permitted by Section 6.01;
(s) non-cash Investments in connection Subsidiaries of Borrower may be established or created if the Borrower and such Subsidiary comply with tax planning and reorganization activitiesthe requirements of Section 5.11, if applicable; provided that after giving effect that, in each case, to the extent such new Subsidiary is created solely for the purpose of consummating an acquisition permitted by this Section 6.04, and such new Subsidiary at no time holds any assets or liabilities other than any merger consideration contributed to it contemporaneously with the closing of such activitiestransactions, such new Subsidiary shall not be required to take the security interests actions set forth in Section 5.11, as applicable, until the respective acquisition is consummated (at which time the surviving entity of the Lenders respective transaction shall be required to so comply in accordance with the Collateral, taken as a whole, would not be materially impairedprovisions thereof);
(t) Investments consisting of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference to this Section 6.04(t)) under Sections 6.01, 6.02, 6.03, 6.05 and 6.08, respectively;
(u) additional Investments; provided that after giving effect to such Investment (A) on a Pro Forma Basis, the Total Net Leverage Ratio is less than or equal to 4.50 to 1.00 and (B) there is no continuing Event of Default;
(v) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the Borrower;
(w) to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials or and equipment or purchases, acquisitions, purchases of contract rights or licenses or leases of other assets, Intellectual Property, or other rightsintellectual property, in each case in the ordinary course of business;
(xu) other Investments by an Unrestricted Subsidiary the Borrower or any of its Subsidiaries not to exceed, in the aggregate, at any time outstanding, $2,500,000; and
(v) Guarantees of leases (other than Capital Lease Obligations) and other obligations that do not constitute Indebtedness, in each case entered into prior to the day such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to the definition of “Unrestricted Subsidiary”;
(y) Investments consisting of purchases of assets of Franchisees (including, but not limited to, area development contracts owned by Franchisees) in the ordinary course of business or otherwise in an amount not exceeding $60,000,000, so long as (A) no Event of Default shall have occurred and be continuing and (B) the Borrower is in pro forma compliance with the Financial Covenant after giving effect to any such purchase;
(z) So long as no Event of Default shall have occurred and be continuing, Investments in Franchisees (including, but not limited to, (i) Guarantees or other credit support of any Indebtedness and other liabilities thereof and (ii) loans, advances or contributions to the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater of $20,000,000 and 70% of Consolidated EBITDA;
(aa) Investments consisting of accounts and payment intangibles owing to the Borrower or any of the Restricted Subsidiaries from Franchisees; provided that such obligation shall be on such terms as the Borrower or the applicable Restricted Subsidiary establishes in good faith; and
(bb) Investments consisting of advances or expenditures by any Loan Party to, or on behalf of, any CMF Subsidiary in support of advertising and marketing programs in the ordinary course consistent with current practices. For purposes of determining compliance with this Section 6.04, in the event that any item of Investment meets the criteria of more than one of the categories of Investments described in clauses (a) through (bb) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such Investment (or any portion thereof) and will only be required to include the amount and type of such Investment in one or more of the above clausesbusiness.
Appears in 1 contract
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor the The Borrower willwill not, nor and will they not permit any Restricted Subsidiary or Intermediate Parent to, make or hold any Investment, except:
(a) Permitted Investments at the time such Permitted Investment is mademade and purchases of assets in the ordinary course of business consistent with past practice;
(b) loans or advances to officers, directors members of the Board of Directors and employees of Holdings, any Intermediate Parent, the Borrower and the Restricted Subsidiaries (i) for reasonable and customary business-related travel, entertainment, relocation and analogous ordinary business purposes, (ii) in connection with such Person’s purchase of Equity Interests in of Holdings (or any direct or indirect parent thereof) (provided that the amount of such loans and advances made in cash to such Person shall be contributed to the Borrower in cash as common equity or Qualified Equity Interests) and (iii) for purposes not described in the foregoing clauses (i) and (ii); provided that at the time of incurrence thereof and after giving Pro Forma Effect thereto, the in an aggregate principal amount outstanding in reliance on for this clause (iii) shall outstanding at any time not to exceed $1,000,0007,000,000;
(c) Investments by Holdings, any Intermediate Parent, the Borrower or in any Restricted Subsidiary and Investments by any Restricted Subsidiary in any of Holdings, any Intermediate Parent, the Borrower or any other Restricted Subsidiary; provided that, in the case of any Investment by a Loan Party in a Restricted Subsidiary that is not a Loan Party, (i) no Event of Default shall have occurred and be continuing or would result therefrom at the aggregate outstanding amount of time such Investment is made and (ii) all such Investments made by Loan Parties in Restricted Subsidiaries that are not Loan Parties in reliance on this clause (cParties, together with all Permitted Acquisitions made pursuant to Section 6.04(h) of targets that do not become Guarantors, shall not exceed the greater of (x) $10,000,000 and 357,000,000 or (y) 20% of Consolidated EBITDA, at any time outstanding, as of the end of the most recently ended Test Period;
(d) Investments consisting of prepayments to suppliers extensions of trade credit and accommodation guarantees in the ordinary course of business;
(e) Investments consisting of extensions of trade credit in the ordinary course of business;
(f) Investments (i) existing or contemplated on the date hereof Effective Date and set forth on Schedule 6.04(f6.04(e) and any modification, replacement, renewal, reinvestment or extension thereof and (ii) Investments existing on the date hereof Effective Date by Holdings, the Borrower or any Restricted Subsidiary in the Borrower or any Restricted Subsidiary and any modification, renewal or extension thereof; provided that the amount of the original Investment is not increased except by the terms of such Investment to the extent as set forth on Schedule 6.04(f6.04(e) or as otherwise permitted by this Section 6.04;
(gf) Investments in Swap Agreements permitted under Section 6.01(a)(vi)incurred in the ordinary course of business and not for speculative purposes;
(hg) promissory notes and other non-cash consideration received in connection with Dispositions permitted by Section 6.05;
(ih) Permitted Acquisitions; provided that the aggregate consideration (except to the extent funded with the proceeds of Qualified Equity Interests) paid for Permitted Acquisitions of targets that do not become Guarantors, together with all Investments made pursuant to Section 6.04(c) above by Loan Parties in Restricted Subsidiaries that are not Loan Parties, shall not exceed the greater, at any time outstanding, of $7,000,000 and 20% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Permitted Acquisition;
(ji) the Transactions;
(kj) Investments in the ordinary course of business consisting of Uniform Commercial Code Article 3 endorsements for collection or deposit and Uniform Commercial Code Article 4 customary trade arrangements with customers consistent with past practicesin the ordinary course of business;
(lk) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers and customers, from financially troubled account debtors customers or in settlement of delinquent obligations of, or other disputes with, customers and suppliers or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment;
(ml) loans and advances to Holdings (or any direct or indirect parent thereof) or any Intermediate Parent in lieu of, and not in excess of the amount of (after giving effect to any other loans, advances or Restricted Payments in respect thereof), Restricted Payments to the extent permitted to be made to Holdings (or such parent) or such Intermediate Parent in accordance with Section 6.08(a6.07(a);
(nm) additional Investments and other acquisitions; provided that at the time any such Investment or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition made in reliance on this clause (nm), together with the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (nm) (including the aggregate principal amount of all Indebtedness assumed in connection with any such other Investment or acquisition previously made under this clause (m)), shall not exceed the sum sum, at any time outstanding, of (A) the greater of $18,000,000 15,000,000 and 6037.5% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Investment or other acquisition, plus (B) so long as immediately after giving effect to any such Investment no Event of Default has occurred and is continuing, continuing the Available Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of such Investment, plus (C) the Available Equity Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of such Investment;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby;
(pn) advances of payroll payments to employees in the ordinary course of business;
(qo) Investments and other acquisitions to the extent that payment for such Investments is made with Qualified Equity Interests (excluding Cure Amounts) of Holdings (or any direct or indirect parent thereof or the IPO Entity); provided that (i) such amounts used pursuant to this clause (q) shall not increase the Available Amount and (ii) any amounts used for such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof or the IPO Entity) shall otherwise be permitted pursuant to this Section 6.04;
(rp) Investments of a Subsidiary acquired after the Effective Date or of a Person merged or consolidated with any Subsidiary in accordance with this Section 6.04 and Section 6.03 after the Effective Date or that otherwise becomes a Subsidiary (provided that if such Investment is made under Section 6.04(h), existing Investments in subsidiaries of such Subsidiary or Person shall comply with the requirements of Section 6.04(h)) to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger or consolidation and were in existence on the date of such acquisition, merger or consolidation;
(q) receivables owing to the Borrower or any Restricted Subsidiary, if created or acquired in the ordinary course of business;
(r) Investments (A) for utilities, security deposits, leases and similar prepaid expenses incurred in the ordinary course of business and (B) trade accounts created, or prepaid expenses accrued, in the ordinary course of business;
(s) non-cash Investments in connection with tax planning and reorganization activities; provided that after giving effect to any such activities, the security interests of the Lenders in the Collateral, taken as a whole, would not be materially impaired;
(t) additional Investments so long as at the time of any such Investment and after giving effect thereto, (A) on a Pro Forma Basis, the Total Net Leverage Ratio is no greater than 2.00 to 1.00, at any time outstanding, and (B) no Event of Default exists or would result therefrom;
(u) Investments consisting of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference to this Section 6.04(t6.04(u)) under Sections 6.01, 6.02, 6.03, 6.05 and 6.086.07, respectively;
(u) additional Investments; provided that after giving effect to such Investment (A) on a Pro Forma Basis, the Total Net Leverage Ratio is less than or equal to 4.50 to 1.00 and (B) there is no continuing Event of Default;
(v) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the Borrower;
(w) to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Property, or other rights, in each case in the ordinary course of business;
(x) any Investment in any Subsidiary or any joint venture in connection with intercompany cash management arrangements or related activities arising in the ordinary course of business;
(y) Investments by an Unrestricted Subsidiary entered into prior to the day such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to the definition of “Unrestricted Subsidiary”;
(yz) [Reserved];
(aa) Investments consisting of purchases of assets of Franchisees (including, but not limited to, area development contracts owned by Franchisees) in the ordinary course of business or otherwise in an amount not exceeding $60,000,000, so long as (A) no Event of Default shall have occurred and be continuing and (B) the Borrower is in pro forma compliance with the Financial Covenant after giving effect to any such purchase;
(z) So long as no Event of Default shall have occurred and be continuing, Investments in Franchisees (including, but not limited to, (i) Guarantees or other credit support of any Indebtedness and other liabilities thereof and (ii) loans, advances or contributions to the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater of $20,000,000 and 70% of Consolidated EBITDA;
(aa) Investments consisting of accounts and payment intangibles owing to the Borrower or any of the Restricted Subsidiaries from Franchisees; provided that such obligation shall be on such terms as the Borrower or the applicable Restricted Subsidiary establishes in good faithSettlements; and
(bb) Investments consisting arising as a result of advances or expenditures sale-leaseback transactions permitted by any Loan Party to, or on behalf of, any CMF Subsidiary in support of advertising and marketing programs in the ordinary course consistent with current practices. For purposes of determining compliance with this Section 6.04, in the event that any item of Investment meets the criteria of more than one of the categories of Investments described in clauses (a) through (bb) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such Investment (or any portion thereof) and will only be required to include the amount and type of such Investment in one or more of the above clauses6.06 hereto.
Appears in 1 contract
Samples: First Lien Credit Agreement (Brigham Minerals, Inc.)
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor Subject to the last paragraph of this Section 6.04, the Borrower willwill not, nor and will they not permit any Restricted Subsidiary or Intermediate Parent to, make or hold any Investment, except:
(a) Permitted Investments at the time such Permitted Investment is made;
(b) loans or advances to officers, directors members of the Board of Directors and employees of Holdings, any Intermediate Parent, the Borrower and the its Restricted Subsidiaries (i) for reasonable and customary business-related travel, entertainment, relocation and analogous ordinary business purposes, (ii) in connection with such Person’s purchase of Equity Interests in of Holdings (or any direct or indirect parent thereof) (provided that the amount of such loans and advances made in cash to such Person shall be contributed to the Borrower in cash as in exchange for common equity or other Qualified Equity Interests) and such amounts shall not increase the Available Amount and (iii) for purposes not described in the foregoing clauses (i) and (ii); provided that at the time of incurrence thereof and after giving Pro Forma Effect thereto, the in an aggregate principal amount outstanding in reliance on this clause (iii) shall at any time not to exceed $1,000,0002,500,000;
(c) Investments by Holdings, the Borrower in any Intermediate Parent, Restricted Subsidiary and Investments by any Restricted Subsidiary in the Borrower or any Restricted Subsidiary in any of Holdings, any Intermediate Parent, the Borrower or any other Restricted Subsidiary; provided that, in the case of any Investment by a Loan Party in a Restricted Subsidiary that is not a Loan Party, (i) no Event of Default shall have occurred and be continuing or would result therefrom at the time such Investment is made and (ii) the aggregate outstanding amount of all such Investments made by Loan Parties after the Closing Date in Restricted Subsidiaries that are not Loan Parties in reliance on this clause (c), together with the aggregate cash consideration paid for Permitted Acquisitions of Persons that do not become Subsidiary Loan Parties (or are not merged with and into the Borrower or a Subsidiary Loan Party) or of assets that are not owned by the Borrower or a Subsidiary Loan Party after giving Pro Forma Effect to each such applicable Permitted Acquisition and any transactions occurring in connection therewith in reliance on clause (h) below, shall not exceed the greater of $10,000,000 7,300,000 and 3510% of Consolidated EBITDAEBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Investment;
(d) Investments consisting of prepayments to suppliers in the ordinary course of business;
(e) Investments consisting of extensions of trade credit in the ordinary course of business;
(fe) Investments (i) existing or contemplated on the date hereof Closing Date and set forth on Schedule 6.04(f6.04(e) and any modification, replacement, renewal, reinvestment or extension thereof and (ii) Investments existing on the date hereof Closing Date by Holdings, the Borrower or any Restricted Subsidiary in the Borrower or any Restricted Subsidiary and any modification, renewal or extension thereof; provided that the amount of the original Investment is not increased except by the terms of such Investment as, and to the extent as extent, set forth on Schedule 6.04(f6.04(e) or as otherwise permitted by another clause of this Section 6.04;
(gf) Investments in Swap Agreements permitted under Section 6.01(a)(vi)incurred in the ordinary course of business and not for speculative purposes;
(hg) promissory notes and other non-cash consideration received in connection with Dispositions permitted by Section 6.05;
(ih) Permitted Acquisitions; provided that the aggregate cash consideration paid for Permitted Acquisitions of Persons that do not become Subsidiary Loan Parties (or are not merged with and into the Borrower or a Subsidiary Loan Party) or of assets that are not owned by the Borrower or a Subsidiary Loan Party, together with the aggregate amount of all Investments made by Loan Parties after the Closing Date in Restricted Subsidiaries that are not Loan Parties in reliance on clause (c) above, shall not exceed the greater of $7,300,000 and 10% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Permitted Acquisition and any transactions occurring in connection therewith;
(ji) the Transactions;
(kj) Investments in the ordinary course of business consisting of Uniform Commercial Code Article 3 endorsements for collection or deposit and Uniform Commercial Code Article 4 customary trade arrangements with customers consistent with past practicesin the ordinary course of business;
(lk) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers and customers, from financially troubled account debtors customers or in settlement of delinquent obligations of, or other disputes with, customers and suppliers or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment;
(ml) loans and advances to Holdings (or any direct or indirect parent thereof) or any Intermediate Parent in lieu of, and not in excess of the amount of (after giving effect to any other loans, advances or Restricted Payments in respect thereof), Restricted Payments to the extent permitted to be made to Holdings (or such parent) or such Intermediate Parent in accordance with Section 6.08(a6.07(a); provided that any such loan or advance shall reduce the amount of such applicable Restricted Payments thereafter permitted under Section 6.07(a) by a corresponding amount (if the applicable provision of Section 6.07(a) contains a maximum amount);
(nm) so long as no Default or Event of Default shall have occurred and be continuing or would result therefrom, additional Investments and other acquisitionsInvestments; provided that at the time any such Investment or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition made in reliance on this clause (nm), together with the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (nm) (including the aggregate principal amount of all Indebtedness assumed in connection with any such other Investment or acquisition previously made under this clause (m)), shall not exceed the sum of (A) the greater of $18,000,000 11,000,000 and 6015% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Investment or other acquisition, plus (B) so long as no Event of Default has occurred and after giving effect to such Investment on a Pro Forma Basis, the Total Net Leverage Ratio is continuingequal to or less than 4.90 to 1.00, the Available Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of such Investment;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby;
(pn) advances of payroll payments to employees in the ordinary course of business;
(qo) Investments and other acquisitions to the extent that payment for such Investments is made with Qualified Equity Interests (excluding Cure Amounts) of Holdings (or any direct or indirect parent thereof or the IPO Entitythereof); provided that (i) such amounts used pursuant to this clause (q) shall not increase the Available Amount and (ii) any amounts used for such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof or the IPO Entity) shall otherwise be permitted pursuant to this Section 6.04;
(rp) Investments of a Restricted Subsidiary acquired after the Effective Closing Date or of a Person merged or consolidated with any Restricted Subsidiary in accordance with this Section 6.04 and Section 6.03 after the Effective Closing Date or that otherwise becomes a Restricted Subsidiary (provided that if such Investment is made under Section 6.04(h), existing Investments in subsidiaries of such Restricted Subsidiary or Person shall comply with the requirements of Section 6.04(h)) to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger or consolidation and were in existence on the date of such acquisition, merger or consolidation;
(q) receivables owing to the Borrower or any Restricted Subsidiary, if created or acquired in the ordinary course of business;
(r) Investments (A) for utilities, security deposits, leases and similar prepaid expenses incurred in the ordinary course of business and (B) trade accounts created, or prepaid expenses accrued, in the ordinary course of business;
(s) non-cash Investments in connection with bona fide tax planning and reorganization activities; provided that after giving effect to any such activitiesnon-cash Investments, the security interests of the Lenders in the Collateral, taken as a whole, and the Guarantees by the Loan Parties under the Guarantee Agreement, would not be materially impaired;
(t) additional Investments so long as at the time of any such Investment and after giving effect thereto, (A) on a Pro Forma Basis, the Total Net Leverage Ratio is no greater than 4.15 to 1.00 (or, to the extent that this clause (t) is used to make an Investment in, or to designate a Restricted Subsidiary as, an Unrestricted Subsidiary, the Total Net Leverage Ratio is no greater than 3.90 to 1.00) and (B) no Default or Event of Default exists or would result therefrom;
(u) Investments consisting of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference to this Section 6.04(t6.04(u)) under Sections 6.01, 6.02, 6.03, 6.05 and 6.086.07, respectively;
(u) additional Investments; provided that after giving effect to such Investment (A) on a Pro Forma Basis, the Total Net Leverage Ratio is less than or equal to 4.50 to 1.00 and (B) there is no continuing Event of Default;
(v) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the Borrower;
(w) to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Property, or other rights, in each case in the ordinary course of businessbusiness and consistent with past practices;
(x) Investments by an Unrestricted Subsidiary entered into prior to the day such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to the definition of “Unrestricted Subsidiary”in any Term Loans in accordance with Section 9.04(f);
(y) Investments consisting of purchases of assets of Franchisees (including, but not limited to, area development contracts owned by Franchisees) in the ordinary course of business or otherwise in an amount not exceeding $60,000,000, so long as (A) no Event of Default shall have occurred and be continuing and (B) the Borrower is in pro forma compliance connection with the Financial Covenant after giving effect to any such purchaseSettlements;
(z) So Investments arising as a result of sale-leaseback transactions permitted by Section 6.06; and
(aa) so long as no Default or Event of Default shall have has occurred and be continuingis continuing or would otherwise result therefrom, Investments in Franchisees (including, but joint ventures and Unrestricted Subsidiaries in an aggregate amount not limited to, (i) Guarantees or other credit support of any Indebtedness and other liabilities thereof and (ii) loans, advances or contributions to the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater of $20,000,000 11,000,000 and 7015% of Consolidated EBITDA;
(aa) Investments consisting of accounts and payment intangibles owing EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the Borrower or any making of such Investment. Notwithstanding anything to the Restricted Subsidiaries from Franchisees; provided that such obligation shall be on such terms as the Borrower or the applicable Restricted Subsidiary establishes contrary in good faith; and
this Section 6.04, (bbi) Investments consisting of advances or expenditures no Material Intellectual Property owned by any Loan Party may be directly or indirectly contributed and/or assigned as an Investment or otherwise transferred to any Person that is not a Loan Party and (ii) the Borrower will not, and will not permit any Restricted Subsidiary to, make or on behalf ofhold any Investment in any Unrestricted Subsidiary unless, any CMF Subsidiary in support of advertising and marketing programs in at the ordinary course consistent with current practices. For purposes of determining compliance with this Section 6.04, in the event that any item of Investment meets the criteria of more than one of the categories of Investments described in clauses (a) through (bb) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such Investment (or any portion thereof) and will only be required to include the amount and type time of such Investment and after giving effect thereto, the Borrower shall be in one or more compliance, on a Pro Forma Basis, with a Total Net Leverage Ratio of no greater than 4.15 to 1.00 (or, if lower, the above clausesFinancial Performance Covenant), in either case, for the Test Period then most recently ended.
Appears in 1 contract
Samples: Credit Agreement (Atlas Technical Consultants, Inc.)
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor the Parent Borrower will, nor will they permit any Restricted Subsidiary or Intermediate Parent to, make or hold any Investment, except:
(a) Permitted Investments at the time such Permitted Investment is made;
(b) loans or advances to officers, directors and employees of Holdings, any Intermediate Parent, the Parent Borrower and the its Restricted Subsidiaries (i) for reasonable and customary business-related travel, entertainment, relocation and analogous ordinary business purposes, (ii) in connection with such Person’s purchase of Equity Interests in of Holdings (or any direct or indirect parent thereof) (provided that the amount of such loans and advances made in cash to such Person shall be contributed to the Parent Borrower in cash as common equity or Qualified Equity Interests) and (iii) for purposes not described in the foregoing clauses (i) and (ii); provided that at the time of incurrence thereof and after giving Pro Forma Effect thereto, the in an aggregate principal amount outstanding in reliance on this clause (iii) shall at any time not to exceed $1,000,0002,000,000;
(c) Investments by Holdings, any Intermediate Parent, the Parent Borrower or any Restricted Subsidiary in any of Holdings, any Intermediate Parent, the Parent Borrower or any Restricted Subsidiary; provided that, in the case of any Investment by a Loan Party in a Restricted Subsidiary that is not a Loan Party, no Significant Event of Default shall have occurred and be continuing or would result therefrom; provided that the aggregate outstanding amount of Investments made by Loan Parties and Restricted Subsidiaries organized under the laws of Malaysia in Restricted Subsidiaries that are not Loan Parties (other than any such Investments by Loan Parties in reliance on Restricted Subsidiaries organized under the laws of Malaysia which shall not be limited by this clause (cproviso) shall not exceed the greater of $10,000,000 and 35% of Consolidated EBITDA5,000,000 at any one time outstanding;
(d) Investments consisting of (A) prepayments to suppliers in the ordinary course of business;
business and (eB) Investments consisting of extensions of trade credit in the ordinary course of business;
(fe) Investments (i) existing or contemplated on the date hereof and set forth on Schedule 6.04(f6.04(e) and any modification, replacement, renewal, reinvestment or extension thereof and (ii) Investments existing on the date hereof by Holdings, the Parent Borrower or any Restricted Subsidiary in the Parent Borrower or any Restricted Subsidiary and any modification, renewal or extension thereof; provided that the amount of the original Investment is not increased except by the terms of such Investment to the extent as set forth on Schedule 6.04(f6.04(e) or as otherwise permitted by this Section 6.04;
(gf) Investments in Swap Agreements permitted under Section 6.01(a)(vi)6.01;
(hg) promissory notes and other non-cash consideration received in connection with Dispositions permitted by Section 6.05;
(ih) Permitted Acquisitions; provided that for so long as the Secured Leverage Ratio is greater than 1.50:1.00 to 1.00 on a Pro Forma Basis after giving effect to any such purchase or other acquisition, the cash consideration (i) paid in respect of any Restricted Subsidiary that shall not be or, after giving effect to such Permitted Acquisition, shall not become a Loan Party, shall not exceed, when taken together with all other acquired Restricted Subsidiaries pursuant to this Section 6.04(h) that have not become Loan Parties, $10,000,000 in the aggregate and (ii) paid for all purchases and acquisitions pursuant to this Section 6.04(h) shall not exceed $50,000,000 in the aggregate;
(i) Investments by Holdings, any Intermediate Parent, the Parent Borrower or any Restricted Subsidiary (i) in any Restricted Subsidiary that is not a Loan Party, constituting an exchange of Equity Interests of such Restricted Subsidiary for Indebtedness of such Subsidiary, (ii) constituting Guarantees of Indebtedness or other monetary obligations of Restricted Subsidiaries that are not Loan Parties owing to any Loan Party, (iii) in Restricted Subsidiaries that are not Loan Parties so long as such transactions is part of a series of simultaneous transactions that result in the proceeds of the initial Investment being invested in one or more Loan Parties (or, if the initial proceeds were held at a Restricted Subsidiary that is not a Loan Party, a Restricted Subsidiary that is not a Loan Party) and (iv) in any Restricted Subsidiary that is not a Loan Party, consisting of the contribution of Equity Interests of any other Restricted Subsidiary that is not a Loan Party so long as the Equity Interests of the transferee Restricted Subsidiary is pledged to secure the Secured Obligations;
(j) the Transactions;
(k) Investments in the ordinary course of business consisting of Uniform Commercial Code Article 3 endorsements for collection or deposit and Uniform Commercial Code Article 4 customary trade arrangements with customers consistent with past practices;
(lk) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers and customers, from financially troubled account debtors customers or in settlement of delinquent obligations of, or other disputes with, customers and suppliers or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment;
(ml) loans and advances to Holdings (or any direct or indirect parent thereof) or any Intermediate Parent in lieu of, and not in excess of the amount of (after giving effect to any other loans, advances or Restricted Payments in respect thereof), Restricted Payments to the extent permitted to be made to Holdings (or such parent) or such Intermediate Parent in accordance with Section 6.08(a);
(nm) additional Investments and other acquisitions; provided that at the time any such Investment or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition made in reliance on this clause (nm), together with the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (n), m) shall not exceed the sum of (A) the greater of $18,000,000 and 60% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Investment or other acquisition20,000,000, plus (B) so long as no Event subject to the conditions to use set forth in the definition of Default has occurred and is continuingAvailable Amount, the Available Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of such Investment, plus (C) the Available Equity Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of such Investment;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby;
(pn) advances of payroll payments to employees in the ordinary course of business;
(qo) Investments and other acquisitions to the extent that payment for such Investments is made with Qualified Equity Interests (excluding Cure Amounts) of Holdings (or any direct or indirect parent thereof or the IPO EntityParent); provided that (i) such amounts used pursuant to this clause (qo) shall not increase the Available Equity Amount and (ii) any amounts used for such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof of or the IPO EntityParent) shall are otherwise be permitted pursuant to this Section 6.046.04 (including, for the avoidance of doubt, any cash consideration with respect to Permitted Acquisitions consummated pursuant to Section 6.04(h) or otherwise);
(rp) Investments of a Subsidiary acquired after the Effective Date or of a Person merged or consolidated with any Subsidiary in accordance with this Section and Section 6.03 after the Effective Date to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger or consolidation and were in existence on the date of such acquisition, merger or consolidation;
(sq) non-cash Investments in connection with tax planning and reorganization activities; provided that after giving effect to any such activities, the security interests of the Lenders in the Collateral, taken as a whole, would not be materially impaired;; and
(tr) Investments consisting of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference to this Section 6.04(t6.04(r)) under Sections 6.01, 6.02, 6.03, 6.05 and 6.08, respectively;
(us) additional InvestmentsInvestments (including Permitted Acquisitions); provided that after giving effect to any such Investment (A) on a Pro Forma Basis, the Total Net Leverage Ratio is less than or equal to 4.50 1.00 to 1.00 and (B) there is no continuing Event as of Defaultthe most recent Test Period;
(vt) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the Parent Borrower;
(wu) to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Property, or other rights, in each case in the ordinary course of business;
(xv) Investments by an Unrestricted Subsidiary entered into prior to the day such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to the definition of “Unrestricted Subsidiary”;
(yw) Investments consisting of purchases of assets of Franchisees (including, but not limited to, area development contracts owned by Franchisees) a captive insurance subsidiary in the ordinary course of business accordance with any investment policy or otherwise in an amount not exceeding $60,000,000, so long as (A) no Event of Default shall have occurred and be continuing and (B) the Borrower is in pro forma compliance with the Financial Covenant after giving effect any insurance statutes or regulations applicable to any such purchase;it; and
(zx) So long as no Event of Default shall have occurred and be continuing, Investments in Franchisees (including, but not limited to, (i) Guarantees or other credit support of any Indebtedness and other liabilities thereof and (ii) loans, advances or contributions to the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater of $20,000,000 and 70% of Consolidated EBITDA;
(aa) Investments consisting of accounts and payment intangibles owing to the Borrower or any of the Restricted Subsidiaries from Franchisees; provided that such obligation shall be on such terms as the Borrower or the applicable Restricted Subsidiary establishes in good faith; and
(bb) Investments consisting of advances or expenditures by any Loan Party to, or on behalf of, any CMF Subsidiary in support of advertising and marketing programs in the ordinary course consistent with current practices. For purposes of determining compliance with this Section 6.04, in the event that any item of Investment meets the criteria of more than one of the categories of Investments described in clauses (a) through (bb) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such Investment (or any portion thereof) and will only be required to include the amount and type of such Investment in one or more of the above clausesTransactions.
Appears in 1 contract
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor the The Borrower willwill not, nor and will they not permit any Restricted Subsidiary or Intermediate Parent to, make or hold any Investment, except:
(a) Permitted Investments at the time such Permitted Investment is madeInvestments;
(b) loans or advances to officers, directors and employees of Holdings, any Intermediate Parent, the Borrower and the Restricted Subsidiaries (i) for reasonable and customary business-related travel, entertainment, relocation and analogous ordinary business purposes, (ii) in connection with such Person’s purchase of Equity Interests in Holdings (or any direct or indirect parent thereof) of the Borrower (provided that the amount of such loans and advances made in cash to such Person shall be contributed to the Borrower in cash as common equity or Qualified Equity Interests) and (iii) for purposes not described in the foregoing clauses (i) and (ii); provided that at the time of incurrence thereof and after giving Pro Forma Effect thereto, the in an aggregate principal amount outstanding in reliance on this clause (iii) shall at any time not to exceed $1,000,0005,000,000;
(c) Investments (i) by Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary in any of Holdings, any Intermediate Parent, the Borrower or any Subsidiary Loan Party (excluding any new Restricted Subsidiary that becomes a Subsidiary Loan Party pursuant to such Investment), (ii) by any Restricted Subsidiary that is not a Loan Party in any other Restricted Subsidiary that is also not a Loan Party (including any Regulated Subsidiary in any other Regulated Subsidiary), (iii) by the Borrower or any Restricted Subsidiary (A) in any Restricted Subsidiary; provided that the aggregate outstanding amount of such Investments made by Loan Parties after the Effective Date in Restricted Subsidiaries that are not Loan Parties in reliance on this clause (ciii)(A) (together with the amount of Investments made in Restricted Subsidiaries that are not Loan Parties pursuant to Section 6.04(h)) shall not exceed $40,000,000 at the greater time of $10,000,000 any such Investment, (B) in any Restricted Subsidiary that is not a Loan Party, constituting an exchange of Equity Interests of such Restricted Subsidiary for Indebtedness of such Subsidiary or (C) constituting Guarantees of Indebtedness or other monetary obligations of Restricted Subsidiaries that are not Loan Parties owing to any Loan Party, (iv) by the Borrower or any Restricted Subsidiary in Restricted Subsidiaries that are not Loan Parties so long as such Investment is part of a series of simultaneous Investments that result in the proceeds of the initial Investment being invested in one or more Loan Parties and 35% (v) by the Borrower or any Restricted Subsidiary in any Restricted Subsidiary that is not a Loan Party, consisting of Consolidated EBITDAthe contribution of Equity Interests of any other Restricted Subsidiary that is not a Loan Party so long as the Equity Interests of the transferee Restricted Subsidiary are pledged to secure the Secured Obligations;
(d) Investments consisting of prepayments to suppliers extensions of trade credit and accommodation guarantees in the ordinary course of business;
(e) Investments consisting of extensions of trade credit in the ordinary course of business;
(f) Investments (i) existing or contemplated on the date hereof Amendment No. 1 Effective Date and set forth on Schedule 6.04(f6.04(e) and any modification, replacement, renewal, reinvestment or extension thereof and (ii) Investments existing on the date hereof Effective Date by Holdings, the Borrower or any Restricted Subsidiary in the Borrower or any Restricted Subsidiary and any modification, renewal or extension thereof; provided that the amount of the original Investment is not increased except by the terms of such Investment to the extent as set forth on Schedule 6.04(f6.04(e) or as otherwise permitted by this Section 6.04;
(gf) Investments in Swap Agreements permitted under Section 6.01(a)(vi)incurred in the ordinary course of business and not for speculative purposes;
(hg) promissory notes and other non-cash consideration received in connection with Dispositions permitted by Section 6.05;
(ih) Permitted Acquisitions; provided that (i) the aggregate amount of consideration paid or provided by the Borrower or any other Loan Party after the Effective Date in reliance on this Section 6.04(h) (together with the amount of Investments made in Restricted Subsidiaries that are not Loan Parties pursuant to Section 6.04(c)) for Permitted Acquisitions for any Restricted Subsidiary that shall not be, or, after giving effect to such Permitted Acquisition, shall not become, a Loan Party and for any assets that shall not be, or after giving effect to such Permitted Acquisition shall not become, Collateral, shall not exceed $40,000,000 at such time; (ii) no Default or Event of Default has occurred or is continuing at the time of consummation of such Investment; and (iii) at the time of consummation of such Investment and immediately after giving effect thereto, the Borrower shall be in Pro Forma Compliance with the Financial Performance Covenant set forth in Section 6.11 as of the end of the most recently ended Test Period (and assuming that the Financial Performance Covenant is required to be tested for such Test Period, whether or not otherwise then in effect);
(i) Investments by the Borrower in any Restricted Subsidiary or by any Restricted Subsidiary in any other Restricted Subsidiary or the Borrower incurred in connection with intercompany tax withholding arrangements for the purpose of paying withholding tax on vesting restricted stock units as contemplated by Section 6.07(a)(iv);
(j) the Transactions;
(k) Investments in the ordinary course of business consisting of Uniform Commercial Code Article 3 endorsements for collection or deposit and Uniform Commercial Code Article 4 customary trade arrangements with customers consistent with past practices;
(lk) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers and customers, from financially troubled account debtors customers or in settlement of delinquent obligations of, or other disputes with, customers and suppliers or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment;
(ml) loans and advances to Holdings (or any direct or indirect parent thereof) or any Intermediate Parent the Borrower in lieu of, and not in excess of the amount of (after giving effect to any other loans, advances or Restricted Payments in respect thereof), Restricted Payments to the extent permitted to be made to Holdings the Borrower (or such parent) or such Intermediate Parent in accordance with Section 6.08(a6.07(a)(iv), (vi) or (vii);
(nm) additional other Investments and other acquisitions; provided that at the time any such Investment or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition all Investments made in reliance on this clause (nm), together with the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (nm) (including the aggregate principal amount of all Indebtedness assumed in connection with any such other acquisition), shall not exceed the sum of (A) the greater of $18,000,000 and 60% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Investment or other acquisition, Initial Restricted Payment Amount plus (B) so long as no Event of Default has occurred and is continuing, the Available Amount that is Not Otherwise Applied Applied, plus (C) the Available Equity Amount that is Not Otherwise Applied; provided further that, (x) the Total Net Leverage Ratio shall not exceed 2.50:1.00 as in effect immediately prior of such time determined on a Pro Forma Basis and (y) to the extent such Investment (A) constitutes a Limited Condition Acquisition, no Default or Event of Default is occurring or continuing at the time of making execution of the definitive documentation governing such Limited Condition Acquisition and (other than in connection with any Limited Condition Acquisition financed solely with the proceeds of any Incremental Facility or Incremental Equivalent Debt) and no Event of Default under Section 7.01(a), (b), (h) or (i) shall have occurred or be continuing at the time of consummation of such Limited Condition Acquisition) and (B) does not constitute a Limited Condition Acquisition, no Default or Event of Default is occurring or continuing at the time of consummation of such Investment;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby;
(pn) advances of payroll payments to employees in the ordinary course of business;
(qo) Investments and other acquisitions to the extent that payment for such Investments is made with Qualified Equity Interests (excluding Cure Amounts) of Holdings (or any direct or indirect parent thereof or the IPO Entity); provided that (i) such amounts used pursuant to this clause (q) shall not increase the Available Amount and (ii) any amounts used for such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof or the IPO Entity) shall otherwise be permitted pursuant to this Section 6.04Borrower;
(rp) Investments of a Subsidiary acquired after the Effective Date or of a Person merged or consolidated with any Subsidiary in accordance with this Section 6.04 and Section 6.03 after the Effective Date or that otherwise becomes a Subsidiary (provided that if such Investment is made under Section 6.04(h), existing Investments in subsidiaries of such Subsidiary or Person shall comply with the requirements of Section 6.04(h) or 6.04(m) or any other paragraph of this Section 6.04) to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger or consolidation and were in existence on the date of such acquisition, merger or consolidation;
(q) receivables (other than in respect of Indebtedness for borrowed money) owing to the Borrower or any Restricted Subsidiary, if created or acquired in the ordinary course of business;
(r) [reserved];
(s) non-cash Investments in connection with tax planning (A) for utilities, security deposits, leases and reorganization activities; provided that after giving effect to any such activities, the security interests of the Lenders similar prepaid expenses incurred in the Collateralordinary course of business and (B) trade accounts created, taken as a wholeor prepaid expenses accrued, would not be materially impairedin the ordinary course of business;
(t) Investments consisting in Joint Ventures in an aggregate amount not to exceed $10,000,000 at any time outstanding; provided that no Default or Event of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference to this Section 6.04(t)) under Sections 6.01, 6.02, 6.03, 6.05 and 6.08, respectivelyDefault has occurred or is continuing at the time of consummation of such Investment;
(u) additional [reserved];
(v) [reserved]; and
(w) other Investments; provided that after giving effect to such Investment (A) on a Pro Forma Basis, (A) the Total Net Leverage Ratio is less than or equal to 4.50 to 1.00 12.500:1.00 as of such time determined on a Pro Forma Basis, and (B) there is no continuing Event of Default;
(v) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the Borrower;
(w) to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Property, or other rights, in each case in the ordinary course of business;
such Investment (x) Investments by an Unrestricted Subsidiary entered into prior to constitutes a Limited Condition Acquisition, no Default or Event of Default is occurring or continuing at the day time of execution of the definitive documentation governing such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to Limited Condition Acquisition and (other than in connection with any Limited Condition Acquisition financed solely with the definition proceeds of “Unrestricted Subsidiary”;
(yany Incremental Facility or Incremental Equivalent Debt) Investments consisting of purchases of assets of Franchisees (including, but not limited to, area development contracts owned by Franchisees) in the ordinary course of business or otherwise in an amount not exceeding $60,000,000, so long as (A) and no Event of Default under Section 7.01(a), (b), (h) or (i) shall have occurred and or be continuing at the time of consummation of such Limited Condition Acquisition) and (By) the Borrower is in pro forma compliance with the Financial Covenant after giving effect to any such purchase;
(z) So long as does not constitute a Limited Condition Acquisition, no Default or Event of Default shall have occurred and be continuing, Investments in Franchisees (including, but not limited to, (i) Guarantees is occurring or other credit support continuing at the time of any Indebtedness and other liabilities thereof and (ii) loans, advances or contributions to the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater of $20,000,000 and 70% of Consolidated EBITDA;
(aa) Investments consisting of accounts and payment intangibles owing to the Borrower or any of the Restricted Subsidiaries from Franchisees; provided that such obligation shall be on such terms as the Borrower or the applicable Restricted Subsidiary establishes in good faith; and
(bb) Investments consisting of advances or expenditures by any Loan Party to, or on behalf of, any CMF Subsidiary in support of advertising and marketing programs in the ordinary course consistent with current practices. For purposes of determining compliance with this Section 6.04, in the event that any item of Investment meets the criteria of more than one of the categories of Investments described in clauses (a) through (bb) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such Investment (or any portion thereof) and will only be required to include the amount and type consummation of such Investment in one or more and (C) the aggregate outstanding principal amount of the above clausesTerm Facility is no greater than $200,000,000.
Appears in 1 contract
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor the Borrower willwill not, nor and will they not permit any Restricted Subsidiary or Intermediate Parent to, make or hold any Investment, except:
(a) Permitted Investments at the time such Permitted Investment is mademade and purchases of assets in the ordinary course of business consistent with past practice;
(b) loans or advances to officers, directors members of the Board of Directors and employees of Holdings, any Intermediate Parent, the Borrower and the its Restricted Subsidiaries (i) for reasonable and customary business-related travel, entertainment, relocation and analogous ordinary business purposes, (ii) in connection with such Person’s purchase of Equity Interests in of Holdings (or any direct or indirect parent thereof) (provided that the amount of such loans and advances made in cash to such Person shall be contributed to the Borrower Holdings in cash as common equity or Qualified Equity Interests) and (iii) for purposes not described in the foregoing clauses (i) and (ii); provided that at the time of incurrence thereof and after giving Pro Forma Effect thereto, the in an aggregate principal amount outstanding in reliance on under this clause (iii) shall at any time not to exceed $1,000,00010,000,000;
(c) Investments by Holdings, Holdings in any Intermediate Parent, the Borrower or Restricted Subsidiary and Investments by any Restricted Subsidiary in any of Holdings, any Intermediate Parent, the Borrower other Restricted Subsidiary or any Person that becomes a Restricted SubsidiarySubsidiary after the Effective Date as a result of such Investment (but only to the extent that such Investment was not incurred in contemplation thereof); provided that, in the case of any Investment by a Loan Party in a Restricted Subsidiary that the aggregate outstanding amount is not a Loan Party, no Event of Investments made by Loan Parties in Restricted Subsidiaries that are not Loan Parties in reliance on this clause (c) Default shall not exceed the greater of $10,000,000 have occurred and 35% of Consolidated EBITDAbe continuing or would result therefrom;
(d) Investments consisting of prepayments to suppliers extensions of trade credit and accommodation guarantees in the ordinary course of business;
(e) Investments consisting of extensions of trade credit in the ordinary course of business;
(f) Investments (i) existing or contemplated on the date hereof Effective Date and set forth on Schedule 6.04(f) 6.04 and any modification, replacement, renewal, reinvestment or extension thereof and (ii) Investments existing on the date hereof Effective Date by Holdings, the Borrower Holdings or any Restricted Subsidiary in the Borrower Holdings or any Restricted Subsidiary and any modification, renewal or extension thereof; provided that the amount of the original Investment is not increased except by the terms of such Investment to the extent as set forth on Schedule 6.04(f) 6.04 or as otherwise permitted by this Section 6.04;
(gf) Investments in Swap Agreements permitted under Section 6.01(a)(vi)incurred in the ordinary course of business and not for speculative purposes;
(hg) promissory notes and other non-cash consideration received in connection with Dispositions permitted by Section 6.05;
(ih) Permitted Acquisitions;
(ji) the Transactions;
(kj) Investments in the ordinary course of business consisting of Uniform Commercial Code Article 3 endorsements for collection or deposit and Uniform Commercial Code Article 4 customary trade arrangements with customers consistent with past practicesin the ordinary course of business;
(lk) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers and customers, from financially troubled account debtors customers or in settlement of delinquent obligations of, or other disputes with, customers and suppliers or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment;
(ml) loans and advances to Holdings (or any direct or indirect parent thereof) or any Intermediate Parent in lieu of, and not in excess of the amount of (after giving effect to any other loans, advances or Restricted Payments in respect thereof), Restricted Payments to the extent permitted to be made to Holdings (or such parent) or such Intermediate Parent in accordance with Section 6.08(a)[reserved];
(nm) additional Investments and other acquisitions; provided that at the time any such Investment or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition made in reliance on this clause (nm), together with the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (nm) (including the aggregate principal amount of all Indebtedness assumed in connection with any such other Investment or acquisition previously made under this clause (m)), shall not exceed the sum greater of (A) the greater of $18,000,000 52,800,000 and 60(B) 30% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Investment or other acquisition, plus (B) so long as no Event of Default has occurred and is continuing, the Available Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of such Investment;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby;
(pn) advances of payroll payments to employees in the ordinary course of business;
(qo) Investments and other acquisitions to the extent that payment for such Investments is made with Qualified Equity Interests (excluding Qualified Equity Interests the proceeds of which will be applied as Cure Amounts) of Holdings (or any direct or indirect parent thereof or the IPO Entitythereof); provided that (i) such amounts used pursuant to this clause (q) shall not increase the Available Amount and (ii) any amounts used for such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof or the IPO Entity) shall otherwise be permitted pursuant to this Section 6.04;
(rp) Investments of a Subsidiary acquired after the Effective Date or of a Person merged merged, amalgamated or consolidated with any Subsidiary in accordance with this Section 6.04 and Section 6.03 after the Effective Date or that otherwise becomes a Subsidiary (provided that if such Investment is made under Section 6.04(h), existing Investments in subsidiaries of such Subsidiary or Person shall comply with the requirements of Section 6.04(h)) to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger merger, amalgamation or consolidation and were in existence on the date of such acquisition, merger merger, amalgamation or consolidation;
(q) receivables owing to Holdings or any Restricted Subsidiary, if created or acquired in the ordinary course of business;
(r) Investments (A) for utilities, security deposits, leases and similar prepaid expenses incurred in the ordinary course of business and (B) trade accounts created, or prepaid expenses accrued, in the ordinary course of business;
(s) non-cash Investments in connection with tax planning and reorganization activities; provided that after giving effect to any such activities, the security interests of the Lenders in the Collateral, taken as a whole, would not be materially impaired;
(t) additional Investments so long as at the time of any such Investment and after giving effect thereto, (A) on a Pro Forma Basis, the Senior Secured Net Leverage Ratio is no greater than 3.50 to 1.00 for the most recently ended Test Period and (B) no Event of Default exists or would result therefrom;
(u) Investments consisting of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference to this Section 6.04(t6.04(v)) under Sections 6.01, 6.02, 6.03, 6.05 and 6.086.07, respectively;
(u) additional Investments; provided that after giving effect to such Investment (A) on a Pro Forma Basis, the Total Net Leverage Ratio is less than or equal to 4.50 to 1.00 and (B) there is no continuing Event of Default;
(v) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the BorrowerHoldings;
(w) to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Property, or other rights, in each case in the ordinary course of business;
(x) any Investment in any Subsidiary or any joint venture (i) entered into in connection with intercompany cash management arrangements or related activities arising in the ordinary course of business or (ii) not to exceed $30,000,000 at any time outstanding;
(y) Investments by an Unrestricted Subsidiary (i) entered into prior to the day such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to the definition of “Unrestricted Subsidiary”” or (ii) not to exceed $30,000,000 at any time outstanding;
(yz) Investments consisting in or relating to a Securitization Subsidiary that, in the good faith determination of purchases of assets of Franchisees (the Borrower are necessary or advisable to effect any Qualified Securitization Facility or any repurchase obligation in connection therewith, including, but not limited towithout limitation, area development contracts owned Investments of funds held in accounts permitted or required by Franchiseesthe arrangements governing such Qualified Securitization Facilities or any related Indebtedness;
(aa) Investments in the ordinary course of business or otherwise in connection with Settlements; and
(bb) Investments in an aggregate amount not exceeding $60,000,000equal to the portion, if any, of the Available Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of such Investment, so long as (A) no Event of Default shall have occurred and be continuing and (B) the Borrower is in pro forma compliance with the Financial Covenant after giving effect to any such purchase;
(z) So long as no Event of Default shall have occurred and be continuing, Investments in Franchisees (including, but not limited to, (i) Guarantees continuing or other credit support of any Indebtedness and other liabilities thereof and (ii) loans, advances or contributions to the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater of $20,000,000 and 70% of Consolidated EBITDA;
(aa) Investments consisting of accounts and payment intangibles owing to the Borrower or any of the Restricted Subsidiaries from Franchisees; provided that such obligation shall be on such terms as the Borrower or the applicable Restricted Subsidiary establishes in good faith; and
(bb) Investments consisting of advances or expenditures by any Loan Party to, or on behalf of, any CMF Subsidiary in support of advertising and marketing programs in the ordinary course consistent with current practices. For purposes of determining compliance with this Section 6.04, in the event that any item of Investment meets the criteria of more than one of the categories of Investments described in clauses (a) through (bb) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such Investment (or any portion thereof) and will only be required to include the amount and type of such Investment in one or more of the above clauseswould result therefrom.
Appears in 1 contract
Samples: Credit Agreement (LivaNova PLC)
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor the The Borrower willwill not, nor and will they not permit any Restricted Subsidiary or Intermediate Parent to, make or hold any Investment, except:
(a) Permitted Investments at the time such Permitted Investment is madeInvestments;
(b) loans or advances to officers, directors and employees of Holdings, any Intermediate Parent, the Borrower and the Restricted Subsidiaries (i) for reasonable and customary business-related travel, entertainment, relocation and analogous ordinary business purposes, (ii) in connection with such Person’s purchase of Equity Interests in of Holdings (or any direct or indirect parent thereof) (provided that the amount of such loans and advances made in cash to such Person shall be contributed to the Borrower in cash as common equity or Qualified Equity Interests) and (iii) for purposes not described in the foregoing clauses (i) and (ii); provided that at the time of incurrence thereof and after giving Pro Forma Effect thereto, the in an aggregate principal amount outstanding in reliance on this clause (iii) shall at any time the U.S. Dollar Equivalent of which does not exceed $1,000,0007,000,000;
(c) Investments (i) by Holdingsthe Borrower or any Restricted Subsidiary in the Borrower or any Loan Party (excluding any new Restricted Subsidiary that becomes a Loan Party pursuant to such Investment), (ii) by any Intermediate ParentRestricted Subsidiary that is not a Loan Party in any other Restricted Subsidiary that is also not a Loan Party, (iii) by the Borrower or any Restricted Subsidiary (A) in any Restricted Subsidiary; (B) in any Restricted Subsidiary that is not a Loan Party, constituting an exchange of Equity Interests of such Restricted Subsidiary for Indebtedness of such Subsidiary, or (C) constituting Guarantees of Indebtedness or other monetary obligations of Restricted Subsidiaries that are not Loan Parties owing to any Loan Party, (iv) by the Borrower or any Restricted Subsidiary in Restricted Subsidiaries that are not Loan Parties so long as such Investment is part of a series of simultaneous Investments that result in the proceeds of the initial Investment being invested in one or more Loan Parties, and (v) by the Borrower or any Restricted Subsidiary in any Restricted Subsidiary that is not a Loan Party, consisting of Holdings, the contribution of Equity Interests of any Intermediate Parent, other Restricted Subsidiary that is not a Loan Party so long as the Equity Interests of the transferee Restricted Subsidiary are pledged to secure the Secured Obligations; provided the U.S. Dollar Equivalent of the aggregate amount of consideration paid or provided by the Borrower or any Restricted Subsidiary; provided that other Loan Party after the aggregate outstanding amount of Closing Date pursuant to this Section 6.04(c) for Investments made by Loan Parties in Restricted Subsidiaries that are not, shall not be, or, after giving effect to any such Investment, shall not become, Loan Parties in reliance on this clause (c) Parties, shall not exceed the greater of $10,000,000 and 35% of Consolidated EBITDA10,000,000;
(d) Investments consisting of prepayments to suppliers extensions of trade credit and accommodation guarantees in the ordinary course courseOrdinary Course of businessbusinessBusiness;
(e) Investments consisting of extensions of trade credit in the ordinary course of business;
(f) Investments (i) existing or contemplated on the date hereof ClosingAmendment Effective Date and set forth on Schedule 6.04(f6.04(e) and any modification, replacement, renewal, reinvestment or extension thereof and (ii) Investments existing on the date hereof ClosingAmendment Effective Date by Holdings, the Borrower or any Restricted Subsidiary in the Borrower or any Restricted Subsidiary and any modification, renewal or extension thereof; provided that the amount of the original Investment is not increased except by the terms of such Investment to the extent as set forth on Schedule 6.04(f6.04(e) or as otherwise permitted by this Section 6.04;
(g) Investments in Swap Agreements permitted under Section 6.01(a)(vi);
(h) promissory notes and other non-cash consideration received in connection with Dispositions permitted by Section 6.05;
(i) Permitted Acquisitions;
(j) the Transactions;
(k) Investments in the ordinary course of business consisting of endorsements for collection or deposit and customary trade arrangements with customers consistent with past practices;
(l) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers and customers, from financially troubled account debtors or in settlement of delinquent obligations of, or other disputes with, customers and suppliers or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment;
(m) loans and advances to Holdings (or any direct or indirect parent thereof) or any Intermediate Parent in lieu of, and not in excess of the amount of (after giving effect to any other loans, advances or Restricted Payments in respect thereof), Restricted Payments to the extent permitted to be made to Holdings (or such parent) or such Intermediate Parent in accordance with Section 6.08(a);
(n) additional Investments and other acquisitions; provided that at the time any such Investment or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition made in reliance on this clause (n), together with the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (n), shall not exceed the sum of (A) the greater of $18,000,000 and 60% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Investment or other acquisition, plus (B) so long as no Event of Default has occurred and is continuing, the Available Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of such Investment;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby;
(p) advances of payroll payments to employees in the ordinary course of business;
(q) Investments and other acquisitions to the extent that payment for such Investments is made with Qualified Equity Interests (excluding Cure Amounts) of Holdings (or any direct or indirect parent thereof or the IPO Entity); provided that (i) such amounts used pursuant to this clause (q) shall not increase the Available Amount and (ii) any amounts used for such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof or the IPO Entity) shall otherwise be permitted pursuant to this Section 6.04;
(r) Investments of a Subsidiary acquired after the Effective Date or of a Person merged or consolidated with any Subsidiary in accordance with this Section and Section 6.03 after the Effective Date to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger or consolidation and were in existence on the date of such acquisition, merger or consolidation;
(s) non-cash Investments in connection with tax planning and reorganization activities; provided that after giving effect to any such activities, the security interests of the Lenders in the Collateral, taken as a whole, would not be materially impaired;
(t) Investments consisting of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference to this Section 6.04(t)) under Sections 6.01, 6.02, 6.03, 6.05 and 6.08, respectively;
(u) additional Investments; provided that after giving effect to such Investment (A) on a Pro Forma Basis, the Total Net Leverage Ratio is less than or equal to 4.50 to 1.00 and (B) there is no continuing Event of Default;
(v) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the Borrower;
(w) to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Property, or other rights, in each case in the ordinary course of business;
(x) Investments by an Unrestricted Subsidiary entered into prior to the day such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to the definition of “Unrestricted Subsidiary”;
(y) Investments consisting of purchases of assets of Franchisees (including, but not limited to, area development contracts owned by Franchisees) in the ordinary course of business or otherwise in an amount not exceeding $60,000,000, so long as (A) no Event of Default shall have occurred and be continuing and (B) the Borrower is in pro forma compliance with the Financial Covenant after giving effect to any such purchase;
(z) So long as no Event of Default shall have occurred and be continuing, Investments in Franchisees (including, but not limited to, (i) Guarantees or other credit support of any Indebtedness and other liabilities thereof and (ii) loans, advances or contributions to the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater of $20,000,000 and 70% of Consolidated EBITDA;
(aa) Investments consisting of accounts and payment intangibles owing to the Borrower or any of the Restricted Subsidiaries from Franchisees; provided that such obligation shall be on such terms as the Borrower or the applicable Restricted Subsidiary establishes in good faith; and
(bb) Investments consisting of advances or expenditures by any Loan Party to, or on behalf of, any CMF Subsidiary in support of advertising and marketing programs in the ordinary course consistent with current practices. For purposes of determining compliance with this Section 6.04, in the event that any item of Investment meets the criteria of more than one of the categories of Investments described in clauses (a) through (bb) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such Investment (or any portion thereof) and will only be required to include the amount and type of such Investment in one or more of the above clauses.
Appears in 1 contract
Samples: First Lien Amending Agreement (CPI Card Group Inc.)
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor The Parent and the Borrower willwill not, nor and will they not permit any Restricted Subsidiary or Intermediate Parent to, of the Subsidiaries to make or hold any Investment, Investment except:
(a) Permitted Investments at the time such Permitted Investment is madeInvestments;
(b) loans or advances to officers, directors and employees of Holdings, any Intermediate Investments by the Parent, the Borrower and the Restricted Subsidiaries (i) for reasonable and customary business-related travel, entertainment, relocation and analogous ordinary business purposes, (ii) in connection with such Person’s purchase of Equity Interests in Holdings their respective subsidiaries (or other than Investments by any direct or indirect parent thereof) (Loan Party in any Person that is not a Loan Party), provided that the amount of any such loans and advances made in cash to such Person Equity Interests held by a Loan Party shall be contributed pledged to the Borrower Administrative Agent as collateral security for the obligations of the Loan Parties under the Loan Documents pursuant to the Security Documents (subject to the limitations applicable to Foreign Subsidiary Equity Interests referred to in cash as common equity or Qualified Equity Interests) and (iii) for purposes not described in the foregoing clauses (i) and (iiSection 4.01(f)(i); provided that at the time of incurrence thereof and after giving Pro Forma Effect thereto, the aggregate principal amount outstanding in reliance on this clause (iii) shall not exceed $1,000,000);
(c) Investments loans or advances made by Holdings, any Intermediate the Parent, the Borrower or any Restricted Subsidiary in any of Holdings, any Intermediate Loan Party to the Parent, the Borrower or any Restricted Subsidiary; Subsidiary Loan Party, provided that the aggregate outstanding amount of Investments any such loans and advances made by a Loan Party shall be evidenced by a promissory note pledged to the Administrative Agent as collateral security for the obligations of the Loan Parties in Restricted Subsidiaries that are not under the Loan Parties in reliance on this clause (c) shall not exceed Documents pursuant to the greater of $10,000,000 and 35% of Consolidated EBITDASecurity Documents;
(d) Investments consisting (i) Guarantees constituting Indebtedness permitted by Section 6.01, provided that no Subsidiary shall guarantee Permitted Additional Indebtedness unless, if applicable, such guaranty is subordinated to the Obligations on the same terms as such Indebtedness and (ii) Guarantees by the Parent, the Borrower or any Subsidiary of prepayments to suppliers in the ordinary course obligations (other than Indebtedness) of businessthe Parent, the Borrower or any Subsidiary;
(e) Investments consisting of extensions of trade credit in the ordinary course of business;
(f) Investments (i) existing or contemplated on the date hereof and set forth on Schedule 6.04(f) and any modification, replacement, renewal, reinvestment or extension thereof and (ii) Investments existing on the date hereof by Holdings, the Borrower or any Restricted Subsidiary in the Borrower or any Restricted Subsidiary and any modification, renewal or extension thereof; provided that the amount of the original Investment is not increased except by the terms of such Investment to the extent as set forth on Schedule 6.04(f) or as otherwise permitted by this Section 6.04;
(g) Investments in Swap Agreements permitted under Section 6.01(a)(vi);
(h) promissory notes and other non-cash consideration received in connection with Dispositions permitted by Section 6.05;
(i) Permitted Acquisitions;
(j) the Transactions;
(k) Investments in the ordinary course of business consisting of endorsements for collection or deposit and customary trade arrangements with customers consistent with past practices;
(l) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers and customersof, from financially troubled account debtors or in settlement of delinquent obligations of, or other accounts and disputes with, customers and suppliers or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment;
(m) loans and advances to Holdings (or any direct or indirect parent thereof) or any Intermediate Parent in lieu of, and not in excess of the amount of (after giving effect to any other loans, advances or Restricted Payments in respect thereof), Restricted Payments to the extent permitted to be made to Holdings (or such parent) or such Intermediate Parent in accordance with Section 6.08(a);
(n) additional Investments and other acquisitions; provided that at the time any such Investment or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition made in reliance on this clause (n), together with the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (n), shall not exceed the sum of (A) the greater of $18,000,000 and 60% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Investment or other acquisition, plus (B) so long as no Event of Default has occurred and is continuing, the Available Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of such Investment;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby;
(p) advances of payroll payments to employees in the ordinary course of business;
(q) Investments and other acquisitions to the extent that payment for such Investments is made with Qualified Equity Interests (excluding Cure Amounts) of Holdings (or any direct or indirect parent thereof or the IPO Entity); provided that (i) such amounts used pursuant to this clause (q) shall not increase the Available Amount and (ii) any amounts used for such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof or the IPO Entity) shall otherwise be permitted pursuant to this Section 6.04;
(r) Investments of a Subsidiary acquired after the Effective Date or of a Person merged or consolidated with any Subsidiary in accordance with this Section and Section 6.03 after the Effective Date to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger or consolidation and were in existence on the date of such acquisition, merger or consolidation;
(s) non-cash Investments in connection with tax planning and reorganization activities; provided that after giving effect to any such activities, the security interests of the Lenders in the Collateral, taken as a whole, would not be materially impaired;
(t) Investments consisting of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference to this Section 6.04(t)) under Sections 6.01, 6.02, 6.03, 6.05 and 6.08, respectively;
(u) additional Investments; provided that after giving effect to such Investment (A) on a Pro Forma Basis, the Total Net Leverage Ratio is less than or equal to 4.50 to 1.00 and (B) there is no continuing Event of Default;
(v) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the Borrower;
(w) to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Property, or other rightssuppliers, in each case in the ordinary course of business;
(xf) Investments by an Unrestricted Subsidiary entered into prior to Permitted Acquisitions, provided that the day aggregate Purchase Prices of all Permitted Acquisitions under this clause (f) shall not exceed the sum of (i) $150,000,000 plus (ii) the Available Equity Issuance Amounts as at such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary date plus (iii) the aggregate amount subtracted in the calculation of such Available Equity Issuance Amount pursuant to clause (b)(i)(x) of the definition of “Unrestricted Subsidiary”such term, and at the time of such Permitted Acquisition, the Borrower shall deliver a certificate of a Financial Officer setting forth the foregoing calculations and setting forth a calculation of the Available Equity Issuance Amount immediately before and immediately after such Permitted Acquisition;
(yg) Investments consisting of purchases of assets of Franchisees (includingloans and advances to employees, but not limited to, area development contracts owned by Franchisees) directors or consultants in the ordinary course of business (including, without limitation, for travel, entertainment and relocation expenses and temporary advances to employees or otherwise directors in respect of income taxes related to the exercise of stock options) to the extent permitted under the Xxxxxxxx-Xxxxx Act of 2002, as amended, in an aggregate principal amount not exceeding to exceed $60,000,0005,000,000 at any one time outstanding;
(h) Investments by the Parent, the Borrower and the Subsidiaries in Hedging Agreements permitted under Section 6.07;
(i) extensions of trade credit or the holding of receivables owing to the Parent, the Borrower or any Subsidiary if created or acquired in the ordinary course of business;
(j) payroll, travel and similar advances to cover matters that are expected at the time of such advances ultimately to be treated as expenses for accounting purposes and that are made in the ordinary course of business;
(k) Investments that are financed or acquired with Equity Interests of the Parent;
(l) Investments set forth on, or made pursuant to agreements described on, Schedule 6.04 (and other investments received in respect thereof without the payment of additional cash consideration);
(m) Investments made with Net Proceeds to the extent permitted to be so applied or reinvested as set forth in the definition of Prepayment Event;
(n) Investments received as consideration in connection with sales, transfers or other dispositions permitted under this Agreement;
(o) so long as no Default or Dividend Suspension Period has occurred and is continuing, other Investments, the amount of which is deducted from Available Cash for the Relevant Period in which made pursuant to clause (iv) of the definition of such term in Section 1.01, in an aggregate amount not to exceed the amount of Cumulative Distributable Cash at such time, provided that, after April 10, 2011, no Investment shall be made under this clause (o) prior to the date 5 days after the Borrower shall have delivered to the Administrative Agent a certificate of a Financial Officer stating the amount of such Investment to be made pursuant to this clause (o) and demonstrating that the sum of (A) no Event Cumulative Distributable Cash through the most recent fiscal quarter as of Default shall which financial statements have occurred and be continuing and been delivered to the Lenders under Section 5.01 minus (B) the Borrower amount of such Investment, is in pro forma compliance with the Financial Covenant after giving effect to any such purchasegreater than zero;
(zp) So so long as no Default or Dividend Suspension Period has occurred and is continuing, other Investments in an aggregate amount not to exceed the Available Equity Issuance Amount at such time, provided that at the time of any Investment under this clause (p), the Borrower shall deliver a certificate of a Financial Officer stating the amount of the Investment being made pursuant to this clause (p) and setting forth a calculation of the Available Equity Issuance Amount immediately before and immediately after such Investment; and
(q) Investments in joint ventures (including, for the avoidance of doubt, joint ventures in corporate, partnership or limited liability company form) in an aggregate amount not to exceed $10,000,000 so long as both immediately before and after giving pro forma effect thereto no Default or Event of Default shall have occurred and be continuing, Investments in Franchisees (including, but not limited to, (i) Guarantees or other credit support of any Indebtedness and other liabilities thereof and (ii) loans, advances or contributions to the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater of $20,000,000 and 70% of Consolidated EBITDA;
(aa) Investments consisting of accounts and payment intangibles owing to the Borrower or any of the Restricted Subsidiaries from Franchisees; provided that such obligation shall be on such terms as the Borrower or the applicable Restricted Subsidiary establishes in good faith; and
(bb) Investments consisting of advances or expenditures by any Loan Party to, or on behalf of, any CMF Subsidiary in support of advertising and marketing programs in the ordinary course consistent with current practices. For purposes of determining compliance with this Section 6.04, in the event that any item of Investment meets the criteria of more than one of the categories of Investments described in clauses (a) through (bb) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such Investment (or any portion thereof) and will only be required to include the amount and type of such Investment in one or more of the above clauses.
Appears in 1 contract
Samples: Credit Agreement (Alaska Communications Systems Group Inc)
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor the The Borrower willwill not, nor and will they not permit any Restricted Subsidiary or Intermediate Parent to, make or hold any Investment, except:
(a) Permitted Investments at the time such Permitted Investment is madeInvestments;
(b) loans or advances to officers, directors members of the Board of Directors and employees of Holdings, any Intermediate Parent, the Borrower and the its Restricted Subsidiaries (i) for reasonable and customary business-related travel, entertainment, relocation and analogous ordinary business purposes, (ii) in connection with such Person’s purchase of Equity Interests in of Holdings (or any direct or indirect parent thereof) (provided that the amount of such loans and advances made in cash to such Person shall be contributed to the Borrower in cash as common equity or Qualified Equity Interests) and (iii) for purposes not described in the foregoing clauses (i) and (ii); provided that at the time of incurrence thereof and after giving Pro Forma Effect thereto, the in an aggregate principal amount outstanding in reliance on this clause (iii) shall at any time not to exceed $1,000,00024,000,000;
(c) Investments (i) by Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary in any of HoldingsLoan Party (excluding any new Restricted Subsidiary that becomes a Loan Party pursuant to such Investment), (ii) by any Intermediate ParentRestricted Subsidiary that is not a Loan Party in any other Restricted Subsidiary that is also not a Loan Party, (iii) by the Borrower or any Restricted Subsidiary (A) in any Restricted Subsidiary; provided that the aggregate outstanding amount of such Investments made by Loan Parties after the Effective Date in Restricted Subsidiaries that are not Loan Parties in reliance on this clause (ciii)(A) (together with the amount of Investments made in Restricted Subsidiaries that are not Loan Parties pursuant to Section 6.04(h)) shall not exceed the greater Non-Loan Party Investment Amount at the time of $10,000,000 any such Investment, (B) in any Restricted Subsidiary that is not a Loan Party, constituting an exchange of Equity Interests of such Restricted Subsidiary for Indebtedness of such Subsidiary or (C) constituting Guarantees of Indebtedness or other monetary obligations of Restricted Subsidiaries that are not Loan Parties owing to any Loan Party, (iv) by the Borrower or any Restricted Subsidiary in Restricted Subsidiaries that are not Loan Parties so long as such Investment is part of a series of simultaneous Investments that result in the proceeds of the initial Investment being invested in one or more Loan Parties and 35% (v) by the Borrower or any Restricted Subsidiary in any Restricted Subsidiary that is not a Loan Party, consisting of Consolidated EBITDAthe contribution of Equity Interests of any other Restricted Subsidiary that is not a Loan Party so long as the Equity Interests of the transferee Restricted Subsidiary is pledged to secure the Secured Obligations;
(d) Investments consisting of prepayments to suppliers extensions of trade credit and accommodation guarantees in the ordinary course of business;
(e) Investments consisting of extensions of trade credit in the ordinary course of business;
(f) Investments (i) existing or contemplated on the date hereof Effective Date and set forth on Schedule 6.04(f6.04(e) and any modification, replacement, renewal, reinvestment or extension thereof and (ii) Investments existing on the date hereof Effective Date by Holdings, the Borrower or any Restricted Subsidiary in the Borrower or any Restricted Subsidiary and any modification, renewal or extension thereof; provided that the amount of the original Investment is not increased except by the terms of such Investment to the extent as set forth on Schedule 6.04(f6.04(e) or as otherwise permitted by this Section 6.04;
(g) Investments in Swap Agreements permitted under Section 6.01(a)(vi);
(h) promissory notes and other non-cash consideration received in connection with Dispositions permitted by Section 6.05;
(i) Permitted Acquisitions;
(j) the Transactions;
(k) Investments in the ordinary course of business consisting of endorsements for collection or deposit and customary trade arrangements with customers consistent with past practices;
(l) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers and customers, from financially troubled account debtors or in settlement of delinquent obligations of, or other disputes with, customers and suppliers or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment;
(m) loans and advances to Holdings (or any direct or indirect parent thereof) or any Intermediate Parent in lieu of, and not in excess of the amount of (after giving effect to any other loans, advances or Restricted Payments in respect thereof), Restricted Payments to the extent permitted to be made to Holdings (or such parent) or such Intermediate Parent in accordance with Section 6.08(a);
(n) additional Investments and other acquisitions; provided that at the time any such Investment or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition made in reliance on this clause (n), together with the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (n), shall not exceed the sum of (A) the greater of $18,000,000 and 60% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Investment or other acquisition, plus (B) so long as no Event of Default has occurred and is continuing, the Available Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of such Investment;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby;
(p) advances of payroll payments to employees in the ordinary course of business;
(q) Investments and other acquisitions to the extent that payment for such Investments is made with Qualified Equity Interests (excluding Cure Amounts) of Holdings (or any direct or indirect parent thereof or the IPO Entity); provided that (i) such amounts used pursuant to this clause (q) shall not increase the Available Amount and (ii) any amounts used for such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof or the IPO Entity) shall otherwise be permitted pursuant to this Section 6.04;
(r) Investments of a Subsidiary acquired after the Effective Date or of a Person merged or consolidated with any Subsidiary in accordance with this Section and Section 6.03 after the Effective Date to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger or consolidation and were in existence on the date of such acquisition, merger or consolidation;
(s) non-cash Investments in connection with tax planning and reorganization activities; provided that after giving effect to any such activities, the security interests of the Lenders in the Collateral, taken as a whole, would not be materially impaired;
(t) Investments consisting of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference to this Section 6.04(t)) under Sections 6.01, 6.02, 6.03, 6.05 and 6.08, respectively;
(u) additional Investments; provided that after giving effect to such Investment (A) on a Pro Forma Basis, the Total Net Leverage Ratio is less than or equal to 4.50 to 1.00 and (B) there is no continuing Event of Default;
(v) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the Borrower;
(w) to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Property, or other rights, in each case in the ordinary course of business;
(x) Investments by an Unrestricted Subsidiary entered into prior to the day such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to the definition of “Unrestricted Subsidiary”;
(y) Investments consisting of purchases of assets of Franchisees (including, but not limited to, area development contracts owned by Franchisees) in the ordinary course of business or otherwise in an amount not exceeding $60,000,000, so long as (A) no Event of Default shall have occurred and be continuing and (B) the Borrower is in pro forma compliance with the Financial Covenant after giving effect to any such purchase;
(z) So long as no Event of Default shall have occurred and be continuing, Investments in Franchisees (including, but not limited to, (i) Guarantees or other credit support of any Indebtedness and other liabilities thereof and (ii) loans, advances or contributions to the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater of $20,000,000 and 70% of Consolidated EBITDA;
(aa) Investments consisting of accounts and payment intangibles owing to the Borrower or any of the Restricted Subsidiaries from Franchisees; provided that such obligation shall be on such terms as the Borrower or the applicable Restricted Subsidiary establishes in good faith; and
(bb) Investments consisting of advances or expenditures by any Loan Party to, or on behalf of, any CMF Subsidiary in support of advertising and marketing programs in the ordinary course consistent with current practices. For purposes of determining compliance with this Section 6.04, in the event that any item of Investment meets the criteria of more than one of the categories of Investments described in clauses (a) through (bb) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such Investment (or any portion thereof) and will only be required to include the amount and type of such Investment in one or more of the above clauses.
Appears in 1 contract
Samples: Second Lien Credit Agreement (Endurance International Group Holdings, Inc.)
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor the The Borrower willwill not, nor and will they not permit any Restricted Subsidiary or Intermediate Parent to, make or hold any Investment, except:
: (a) Permitted Investments at the time such Permitted Investment is made;
made and purchases of assets in the ordinary course of business consistent with past practice; (b) loans or advances to officers, directors members of the Board of Directors and employees of Holdings, any Intermediate Parent, the Borrower and the its Restricted Subsidiaries (i) for reasonable and customary business-related travel, entertainment, relocation and analogous ordinary business purposes, (ii) in connection with such Person’s purchase of Equity Interests in of Holdings (or any direct or indirect parent thereof) (provided that the amount of such loans and advances made in cash to such Person shall be contributed to the Borrower in cash as common equity or Qualified Equity Interests) and such amounts shall not increase the Available Amount and (iii) for purposes not described in the foregoing clauses (i) and (ii); provided that at the time of incurrence thereof and after giving Pro Forma Effect thereto, the in an aggregate principal amount outstanding in reliance on this clause (iii) shall at any time not to exceed $1,000,000;
; (c) Investments by Holdings, any Intermediate Parent, the Borrower or in any Restricted Subsidiary that is a Loan Party and Investments by any Restricted Subsidiary in any of Holdings, any Intermediate Parent, the Borrower or any other Restricted SubsidiarySubsidiary that is a Loan Party and Investment by a Foreign Subsidiary that is not a Loan Party in another Foreign Subsidiary that is not a Loan Party; provided that the aggregate outstanding amount of Investments made by Loan Parties in Restricted Subsidiaries that are not Loan Parties in reliance on this clause (c) shall not exceed the greater of $10,000,000 and 35% of Consolidated EBITDA;
(d) Investments consisting of prepayments to suppliers in the ordinary course of business;
(e) Investments consisting of extensions of trade credit and accommodation guarantees in the ordinary course of business;
; (fe) Investments (i) existing or contemplated on the date hereof First Amendment Effective Date and set forth on Schedule 6.04(f6.04(e) and any modification, replacement, renewal, reinvestment or extension thereof and (ii) Investments existing on the date hereof Closing Date by Holdings, the Borrower or any Restricted Subsidiary in the Borrower or any Restricted Subsidiary and any modification, renewal or extension thereof; provided that the amount of the original Investment is not increased except by the terms of such Investment to the extent as set forth on Schedule 6.04(f6.04(e) or as otherwise permitted by this Section 6.04;
; (gf) Investments in Swap Agreements permitted under Section 6.01(a)(vi);
incurred in the ordinary course of business and not for speculative purposes; (hg) promissory notes and other non-cash consideration received in connection with Dispositions permitted by Section 6.05;
(i) Permitted Acquisitions;
(j) the Transactions;
(k) Investments in the ordinary course of business consisting of endorsements for collection or deposit and customary trade arrangements with customers consistent with past practices;
(l) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers and customers, from financially troubled account debtors or in settlement of delinquent obligations of, or other disputes with, customers and suppliers or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment;
(m) loans and advances to Holdings (or any direct or indirect parent thereof) or any Intermediate Parent in lieu of, and not in excess of the amount of (after giving effect to any other loans, advances or Restricted Payments in respect thereof), Restricted Payments to the extent permitted to be made to Holdings (or such parent) or such Intermediate Parent in accordance with Section 6.08(a);
(n) additional Investments and other acquisitions; provided that at the time any such Investment or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition made in reliance on this clause (n), together with the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (n), shall not exceed the sum of (A) the greater of $18,000,000 and 60% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Investment or other acquisition, plus (B) so long as no Event of Default has occurred and is continuing, the Available Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of such Investment;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby;
(p) advances of payroll payments to employees in the ordinary course of business;
(q) Investments and other acquisitions to the extent that payment for such Investments is made with Qualified Equity Interests (excluding Cure Amounts) of Holdings (or any direct or indirect parent thereof or the IPO Entity); provided that (i) such amounts used pursuant to this clause (q) shall not increase the Available Amount and (ii) any amounts used for such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof or the IPO Entity) shall otherwise be permitted pursuant to this Section 6.04;
(r) Investments of a Subsidiary acquired after the Effective Date or of a Person merged or consolidated with any Subsidiary in accordance with this Section and Section 6.03 after the Effective Date to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger or consolidation and were in existence on the date of such acquisition, merger or consolidation;
(s) non-cash Investments in connection with tax planning and reorganization activities; provided that after giving effect to any such activities, the security interests of the Lenders in the Collateral, taken as a whole, would not be materially impaired;
(t) Investments consisting of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference to this Section 6.04(t)) under Sections 6.01, 6.02, 6.03, 6.05 and 6.08, respectively;
(u) additional Investments; provided that after giving effect to such Investment (A) on a Pro Forma Basis, the Total Net Leverage Ratio is less than or equal to 4.50 to 1.00 and (B) there is no continuing Event of Default;
(v) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the Borrower;
(w) to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Property, or other rights, in each case in the ordinary course of business;
(x) Investments by an Unrestricted Subsidiary entered into prior to the day such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to the definition of “Unrestricted Subsidiary”;
(y) Investments consisting of purchases of assets of Franchisees (including, but not limited to, area development contracts owned by Franchisees) in the ordinary course of business or otherwise in an amount not exceeding $60,000,000, so long as (A) no Event of Default shall have occurred and be continuing and (B) the Borrower is in pro forma compliance with the Financial Covenant after giving effect to any such purchase;
(z) So long as no Event of Default shall have occurred and be continuing, Investments in Franchisees (including, but not limited to, (i) Guarantees or other credit support of any Indebtedness and other liabilities thereof and (ii) loans, advances or contributions to the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater of $20,000,000 and 70% of Consolidated EBITDA;
(aa) Investments consisting of accounts and payment intangibles owing to the Borrower or any of the Restricted Subsidiaries from Franchisees; provided that such obligation shall be on such terms as the Borrower or the applicable Restricted Subsidiary establishes in good faith; and
(bb) Investments consisting of advances or expenditures by any Loan Party to, or on behalf of, any CMF Subsidiary in support of advertising and marketing programs in the ordinary course consistent with current practices. For purposes of determining compliance with this Section 6.04, in the event that any item of Investment meets the criteria of more than one of the categories of Investments described in clauses (a) through (bb) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such Investment (or any portion thereof) and will only be required to include the amount and type of such Investment in one or more of the above clauses.
Appears in 1 contract
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor the The Borrower willshall not, nor will they and shall not cause or permit any Restricted Subsidiary or Intermediate Parent of its Subsidiaries to, make purchase, hold or hold acquire (including pursuant to any merger with any Person that was not a Wholly Owned Subsidiary prior to such merger) any Investment, except:
(a) Permitted Investments at the time such Permitted Investment is madeCash Equivalent Investments;
(b) Investments by the Borrower in the Equity Interests of its Subsidiaries;
(c) Investments by any Loan Party in any other Loan Party;
(d) loans or advances made by the Borrower to any Subsidiary of the Borrower and made by any Subsidiary to the Borrower or any other Subsidiary of the Borrower;
(e) Guarantees constituting Indebtedness permitted by Section 6.2;
(f) (i) advances to officers, directors and employees of Holdings, any Intermediate Parent, the Borrower and the Restricted Subsidiaries (i) in an aggregate amount not to exceed $2,500,000 at any time outstanding, for reasonable and customary business-related travel, entertainment, relocation and analogous ordinary business purposes, purposes and (ii) in connection with such Person’s Investments consisting of loans to employees to finance the purchase of Equity Interests in Holdings (or any direct or indirect parent thereof) (provided that the amount of such loans and advances made in cash to such Person shall be contributed to the Borrower in cash as common equity or Qualified other than Disqualified Equity Interests) and (iii) for purposes not described of the Borrower pursuant to employee stock purchase plans or agreements approved by the Borrower’s board of directors in the foregoing clauses (i) and (ii); provided that at the time of incurrence thereof and after giving Pro Forma Effect thereto, the an aggregate principal amount outstanding in reliance on this clause (iii) shall not to exceed $1,000,0002,500,000 outstanding at any time;
(cg) Investments by Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary in any of Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary; provided that the aggregate outstanding amount of Investments made by Loan Parties in Restricted Subsidiaries that are not Loan Parties in reliance on this clause (c) shall not exceed the greater of $10,000,000 and 35% of Consolidated EBITDA;
(d) Investments consisting of prepayments to suppliers bank deposits in the ordinary course of business;
(eh) Investments consisting of extensions of credit in the nature of accounts receivable or notes receivable arising from the grant of trade credit in the ordinary course of business;
(f) , and Investments (i) existing received in satisfaction or contemplated on the date hereof and set forth on Schedule 6.04(f) and any modification, replacement, renewal, reinvestment or extension partial satisfaction thereof and (ii) Investments existing on the date hereof by Holdings, the Borrower or any Restricted Subsidiary in the Borrower or any Restricted Subsidiary and any modification, renewal or extension thereof; provided that the amount of the original Investment is not increased except by the terms of such Investment from financially troubled account debtors to the extent as set forth on Schedule 6.04(f) reasonably necessary in order to prevent or as otherwise permitted by this Section 6.04;
(g) Investments in Swap Agreements permitted under Section 6.01(a)(vi);
(h) promissory notes and other non-cash consideration received in connection with Dispositions permitted by Section 6.05limit loss;
(i) Permitted Acquisitionsnon-cash consideration received, to the extent permitted by the Loan Documents, in connection with the Disposition of property permitted by this Agreement;
(j) the TransactionsInvestments to consummate Acquisitions permitted by Section 6.4;
(k) Investments in Hedging Agreements permitted by Section 6.7, to the ordinary course of business consisting of endorsements for collection or deposit and customary trade arrangements with customers consistent with past practicesextent any such Hedging Agreement constitutes an Investment;
(l) Investments (including debt obligations and Equity Interests) received in connection with listed on Schedule 6.6 as of the bankruptcy or reorganization of suppliers and customers, from financially troubled account debtors or in settlement of delinquent obligations of, or other disputes with, customers and suppliers or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured InvestmentEffective Date;
(m) loans and advances to Holdings (Investments existing when a Person becomes a Subsidiary or any direct or indirect parent thereof) or any Intermediate Parent in lieu of, and not in excess of the amount of (after giving effect to any other loans, advances or Restricted Payments in respect thereof), Restricted Payments to the extent permitted to be made to Holdings (or such parent) or such Intermediate Parent in accordance with Section 6.08(a);
(n) additional Investments and other acquisitions; provided that at the time any such Investment Person merges or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition made in reliance on this clause (n), together consolidates with the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (n)Borrower or any Subsidiary as permitted under Section 6.4, shall not exceed the sum of (A) the greater of $18,000,000 and 60% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Investment or other acquisition, plus (B) so long as no Event of Default has occurred and is continuing, the Available Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of such Investment;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby;
(p) advances of payroll payments to employees in the ordinary course of business;
(q) Investments and other acquisitions to the extent that payment for such Investments is made with Qualified Equity Interests (excluding Cure Amounts) of Holdings (or any direct or indirect parent thereof or the IPO Entity); provided that (i) such amounts used pursuant to this clause (q) shall not increase the Available Amount and (ii) any amounts used for such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof or the IPO Entity) shall otherwise be permitted pursuant to this Section 6.04;
(r) Investments of a Subsidiary acquired after the Effective Date or of a Person merged or consolidated with any Subsidiary in accordance with this Section and Section 6.03 after the Effective Date to the extent that such Investments were not made in contemplation of such Person becoming a Subsidiary or in connection with of such acquisitionconsolidation, merger or consolidation and were in existence on the date of such acquisition, merger or consolidation;Acquisition; and
(sn) non-cash other Investments (including loans or advances made by the Borrower to any Subsidiary of the Parent that is not a Subsidiary of the Borrower) not to exceed the greater of (i) $70,000,000 or (ii) twenty percent (20%) of Consolidated EBITDA in connection with tax planning and reorganization activitiesthe aggregate at any time outstanding; provided that after giving effect to any Investments may be made in excess of such activities, the security interests of the Lenders in the Collateral, taken amount so long as a whole, would not be materially impaired;
(t) Investments consisting of Indebtedness, Liens, fundamental changes, Dispositions immediately before and Restricted Payments permitted (other than by reference to this Section 6.04(t)) under Sections 6.01, 6.02, 6.03, 6.05 and 6.08, respectively;
(u) additional Investments; provided that after giving effect to such Investment (Ai) on a Pro Forma Basisno Default or Event of Default exists, (ii) the Total Maximum Net Leverage Ratio is less than or equal to 4.50 to 1.00 shall not exceed 3.50:100 for such computation period and (Biii) there the Loan Parties maintain a minimum balance of $50,000,000 of cash (which shall consist of domestic (U.S.) unrestricted cash plus any unused Revolving Commitments) after such Investment is no continuing Event made; provided that, any Investment that when made complies with the requirements of Default;
(v) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the Borrower;
(w) to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Property, or other rights, in each case in the ordinary course of business;
(x) Investments by an Unrestricted Subsidiary entered into prior to the day such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to the definition of the term “Unrestricted Subsidiary”;
(y) Investments consisting of purchases of assets of Franchisees (including, but not limited to, area development contracts owned by Franchisees) in the ordinary course of business or otherwise in an amount not exceeding $60,000,000, so long as (A) no Event of Default shall have occurred and Cash Equivalent Investment” may continue to be continuing and (B) the Borrower is in pro forma compliance with the Financial Covenant after giving effect to any such purchase;
(z) So long as no Event of Default shall have occurred and be continuing, Investments in Franchisees (including, but not limited to, (i) Guarantees or other credit support of any Indebtedness and other liabilities thereof and (ii) loans, advances or contributions to the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater of $20,000,000 and 70% of Consolidated EBITDA;
(aa) Investments consisting of accounts and payment intangibles owing to the Borrower or any of the Restricted Subsidiaries from Franchisees; provided held notwithstanding that such obligation shall be on Investment if made thereafter would not comply with such terms as the Borrower or the applicable Restricted Subsidiary establishes in good faith; and
(bb) Investments consisting of advances or expenditures by any Loan Party to, or on behalf of, any CMF Subsidiary in support of advertising and marketing programs in the ordinary course consistent with current practices. For purposes of determining compliance with this Section 6.04, in the event that any item of Investment meets the criteria of more than one of the categories of Investments described in clauses (a) through (bb) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such Investment (or any portion thereof) and will only be required to include the amount and type of such Investment in one or more of the above clausesrequirements.
Appears in 1 contract
Samples: Credit Agreement (Globant S.A.)
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings, Intermediate Holdings nor the any Borrower will, nor will they permit any Restricted Subsidiary or Intermediate Parent to, make or hold any Investment, except:
(a) Permitted Investments at the time such Permitted Investment is made;
(b) loans or advances to officers, directors directors, partners and employees of Holdings, any Intermediate ParentHoldings, the Borrower Borrowers and the Restricted Subsidiaries (i) for reasonable and customary business-related travel, entertainment, relocation and analogous ordinary business purposes, (ii) in connection with such Person’s purchase of Equity Interests in Holdings (or any direct or indirect parent thereof) (provided that the amount of such loans and advances made in cash to such Person shall be contributed to the Intermediate Holdings or a Borrower in cash as common equity or Qualified Equity Interests), (iii) [reserved] and (iiiiv) for purposes not described in the foregoing clauses (i) and (ii); provided that at the time of incurrence thereof and after giving Pro Forma Effect thereto, the aggregate principal amount outstanding in reliance on this clause (iiiiv) shall not exceed the greater of $1,000,00055,000,000 and 10% of Consolidated EBITDA for the most recently ended Test Period as of such time;
(c) Investments by Holdings, any Intermediate Parent, the Intermediate Holdings, any Borrower or any Restricted Subsidiary in any of Holdings, any Intermediate Parent, the Intermediate Holdings, any Borrower or any Restricted Subsidiary; provided that, in the case of any Investment by a Loan Party in a Restricted Subsidiary that the aggregate outstanding amount is not a Loan Party, no Event of Investments made by Loan Parties in Restricted Subsidiaries that are not Loan Parties in reliance on this clause (c) Default shall not exceed the greater of $10,000,000 have occurred and 35% of Consolidated EBITDAbe continuing or would result therefrom;
(d) Investments consisting of prepayments to suppliers in the ordinary course of business;
(e) Investments consisting of extensions of trade credit in the ordinary course of business;
(f) Investments (i) existing or contemplated on the date hereof and set forth on Schedule 6.04(f) and any modification, replacement, renewal, reinvestment or extension thereof and (ii) Investments existing on the date hereof by Holdings, the Intermediate Holdings, any Borrower or any Restricted Subsidiary in the Holdings, Intermediate Holdings, any Borrower or any Restricted Subsidiary and any modification, renewal or extension thereof; provided that the amount of the original Investment is not increased except by the terms of such Investment to the extent as set forth on Schedule 6.04(f) or as otherwise permitted by this Section 6.04;
(g) Investments in Swap Agreements permitted under Section 6.01(a)(vi)6.01;
(h) promissory notes and other non-cash consideration received in connection with Dispositions permitted by Section 6.05;
(i) Permitted Acquisitions;
(j) the Transactions;
(k) Investments in the ordinary course of business consisting of endorsements for collection or deposit and customary trade arrangements with customers consistent with past practices;
(l) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers and customers, from financially troubled account debtors or in settlement of delinquent obligations of, or other disputes with, customers and suppliers or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment;
(m) loans and advances to Holdings (or any direct or indirect parent thereof) or any Intermediate Parent in lieu of, and not in excess of the amount of (after giving effect to any other loans, advances or Restricted Payments in respect thereof), Restricted Payments to the extent permitted to be made to Holdings (or such parent) or such Intermediate Parent in accordance with Section 6.08(a);
(n) additional other Investments and other acquisitions; provided that at the time any such Investment or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition all Investments made in reliance on this clause (n), ) together with the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (n) (including the aggregate principal amount of all Indebtedness assumed in connection with any such other acquisition), shall not exceed the sum of (A) the greater of $18,000,000 275,000,000 and 6050% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Investment or other acquisition, plus (B) so long as immediately after giving effect to any such Investment no Event of Default under Section 7.01(a), (b), (h) or (i) has occurred and is continuing, the Available Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of such Investment, plus (C) the Available Equity Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of such Investment, plus (D) the Available RP Capacity Amount;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby;.
(p) advances of payroll payments to employees in the ordinary course of business;
(q) Investments and other acquisitions to the extent that payment for such Investments is made with Qualified Equity Interests (excluding Cure Amounts) of Holdings (or any direct or indirect parent thereof or the IPO Entity); provided that (i) such amounts used pursuant to this clause (q) shall not increase the Available Equity Amount, the Available RP Capacity Amount or be applied to increase any other basket hereunder and (ii) any amounts used for such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof or the IPO Entity) shall otherwise be permitted pursuant to this Section 6.04;
(r) Investments of a Subsidiary acquired after the Effective Date or of a Person merged or consolidated with any Subsidiary in accordance with this Section and Section 6.03 after the Effective Date to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger or consolidation and were in existence on the date of such acquisition, merger or consolidation;
(s) non-cash Investments in connection with tax planning and reorganization activities; provided that after giving effect to any such activities, the security interests of the Lenders in the Collateral, taken as a whole, would not be materially impaired;
(t) Investments consisting of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference to this Section 6.04(t)) under Sections 6.01, 6.02, 6.03, 6.05 and 6.08, respectively;
(u) additional Investments; provided that after giving effect to such Investment (A) on a Pro Forma Basis, the Total Net Leverage Ratio is less than or equal to 4.50 to 1.00 and (B) there is no continuing Event of Default;
(v) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the Borrower;
(w) to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Property, or other rights, in each case in the ordinary course of business;
(x) Investments by an Unrestricted Subsidiary entered into prior to the day such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to the definition of “Unrestricted Subsidiary”;
(y) Investments consisting of purchases of assets of Franchisees (including, but not limited to, area development contracts owned by Franchisees) in the ordinary course of business or otherwise in an amount not exceeding $60,000,000, so long as (A) no Event of Default shall have occurred and be continuing and (B) the Borrower is in pro forma compliance with the Financial Covenant after giving effect to any such purchase;
(z) So long as no Event of Default shall have occurred and be continuing, Investments in Franchisees (including, but not limited to, (i) Guarantees or other credit support of any Indebtedness and other liabilities thereof and (ii) loans, advances or contributions to the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater of $20,000,000 and 70% of Consolidated EBITDA;
(aa) Investments consisting of accounts and payment intangibles owing to the Borrower or any of the Restricted Subsidiaries from Franchisees; provided that such obligation shall be on such terms as the Borrower or the applicable Restricted Subsidiary establishes in good faith; and
(bb) Investments consisting of advances or expenditures by any Loan Party to, or on behalf of, any CMF Subsidiary in support of advertising and marketing programs in the ordinary course consistent with current practices. For purposes of determining compliance with this Section 6.04, in the event that any item of Investment meets the criteria of more than one of the categories of Investments described in clauses (a) through (bb) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such Investment (or any portion thereof) and will only be required to include the amount and type of such Investment in one or more of the above clauses.
Appears in 1 contract
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor the The Borrower willwill not, nor and will they not permit any of its Restricted Subsidiary or Intermediate Parent Subsidiaries to, make or hold any InvestmentInvestment except (collectively, except:“Permitted Investments”):
(a) Permitted cash, Cash Equivalents and Investments at the time in assets that were Cash Equivalents when such Permitted Investment is was made;
(b) loans or advances to present or former officers, directors directors, managers, members of management and employees of Holdings, any Intermediate Parent, the Borrower and the Restricted Subsidiaries (i) for reasonable and customary business-related travel, entertainment, relocation and analogous ordinary business purposes, purposes and (ii) in connection with such Person’s purchase of Equity Interests in Holdings the Borrower (or any direct or indirect parent thereof) (provided that the amount of such loans and advances made in cash to such Person shall be contributed to the Borrower in cash as common equity or Qualified Equity Interests) and (iii) for purposes not described in the foregoing clauses (i) and (ii); provided that at the time of incurrence thereof and after giving Pro Forma Effect thereto, the aggregate principal amount outstanding in reliance on this clause (iii) shall not exceed $1,000,000;
(c) Investments (i) by Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary in any of Holdings, Loan Party; (ii) by any Intermediate Parent, Restricted Subsidiary that is not a Loan Party in any other Restricted Subsidiary that is also not a Loan Party; (iii) by the Borrower or any Restricted Subsidiary in any Restricted Subsidiary; provided that the aggregate outstanding amount of such Investments made by Loan Parties after the Closing Date in Restricted Subsidiaries that are not Loan Parties in reliance on this clause (c) iii), shall not exceed exceed, the greater of (x) $10,000,000 100,000,000 and 35(y) 2.50% of Consolidated EBITDATotal Assets; (iv) other intercompany liabilities amongst the Borrower and the Subsidiary Guarantors incurred in the ordinary course of business that are unsecured and subordinated to the Obligations; (v) other intercompany liabilities amongst Restricted Subsidiaries that are not Subsidiary Guarantors incurred in the ordinary course of business in connection with the cash management operations of such Restricted Subsidiaries; and (vi) Investments by the Borrower or any Subsidiary Guarantor in any Restricted Subsidiary that is not a Subsidiary Guarantor consisting solely of (x) the contribution of Equity Interests of any other Restricted Subsidiary that is not a Subsidiary Guarantor held directly by the Borrower or such Subsidiary Guarantor in exchange, Equity Interests (or additional share premium or paid in capital in respect of Equity Interests) of the Restricted Subsidiary to which such contribution is made so long as the Equity Interests of the transferee Restricted Subsidiary is pledged to secure the Obligations; provided, that immediately following the consummation of an Investment pursuant to the preceding clause (x), the Restricted Subsidiary whose Equity Interests are the subject of such Investment remains a Restricted Subsidiary;
(d) Investments consisting of deposits, prepayments and/or other credits to suppliers in the ordinary course of businessbusiness and any assets or securities received in satisfaction or partial satisfaction thereof from financially troubled third party account debtors to the extent reasonably necessary in order to prevent or limit loss;
(e) Investments consisting of extensions of trade credit in the ordinary course of business;
(f) Investments (i) existing or contemplated on the date hereof Closing Date and set forth on Schedule 6.04(f6.08(f) and any modification, replacement, renewal, reinvestment or extension thereof and (ii) Investments existing on the date hereof by Holdings, the Borrower or any Restricted Subsidiary in the Borrower or any Restricted Subsidiary and any modification, renewal or extension thereof; provided that the amount of the original Investment is not increased except by the terms of such Investment to the extent as set forth on Schedule 6.04(f6.08(f) or as otherwise permitted by this Section 6.046.08;
(g) Investments in Swap Agreements permitted under Section 6.01(a)(vi);
(h) promissory notes and other non-cash consideration received in connection with Dispositions Asset Sales permitted by Section 6.05;
(ih) Permitted Acquisitions;
(ji) Investments made in connection with the Transactions;
(kj) Investments in the ordinary course of business consisting of endorsements for collection or deposit and customary trade arrangements with customers consistent with past practicescustomers;
(lk) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers and customers, from financially troubled account debtors or in settlement of delinquent obligations of, or other disputes with, customers and suppliers or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment;
(ml) loans Investments as valued at cost at the time each such Investment is made, in an amount not exceeding the Available Amount, provided that at the time of and advances to Holdings (or any direct or indirect parent thereof) or any Intermediate Parent in lieu of, and not in excess of the amount of (after giving pro forma effect to any such Investment, (x) no Event of Default shall have occurred and be continuing and (y) the Total Net Leverage Ratio does not exceed 3.50:1.00;
(m) other loansInvestments in an aggregate amount, advances or Restricted Payments in respect thereof)as valued at cost at the time each such Investment is made, Restricted Payments to not exceeding (i) the extent permitted to be made to Holdings greater of (or such parentx) or such Intermediate Parent in accordance with Section 6.08(a)$150,000,000 and (y) 3.50% of Consolidated Total Assets;
(n) additional Investments and other acquisitions; provided that at the time any such Investment or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition made in reliance on this clause (n), together with the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (n), shall not exceed the sum of (A) the greater of $18,000,000 and 60% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Investment or other acquisition, plus (B) so long as no Event of Default has occurred and is continuing, the Available Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of such Investment;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby;
(p) advances of payroll payments and expenses to employees in the ordinary course of businessbusiness consistent with past practice;
(q) Investments and other acquisitions to the extent that payment for such Investments is made with Qualified Equity Interests (excluding Cure Amounts) of Holdings (or any direct or indirect parent thereof or the IPO Entity); provided that (i) such amounts used pursuant to this clause (q) shall not increase the Available Amount and (ii) any amounts used for such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof or the IPO Entity) shall otherwise be permitted pursuant to this Section 6.04;
(r) Investments of a Subsidiary acquired after the Effective Date or of a Person merged or consolidated with any Subsidiary in accordance with this Section and Section 6.03 after the Effective Date to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger or consolidation and were in existence on the date of such acquisition, merger or consolidation;
(s) non-cash Investments in connection with tax planning and reorganization activities; provided that after giving effect to any such activities, the security interests of the Lenders in the Collateral, taken as a whole, would not be materially impaired;
(t) Investments consisting of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference to this Section 6.04(t)) under Sections 6.01, 6.02, 6.03, 6.05 and 6.08, respectively;
(uo) additional Investments; provided that (A) after giving pro forma effect to such Investment (A) on a Pro Forma Basis, the Total Net Leverage Ratio is less than or equal to 4.50 3.50 to 1.00 and (B) there is at the time of and after giving pro forma effect to such Investment, no continuing Event of DefaultDefault shall have occurred and be continuing;
(vp) contributions to a “rabbi” trust for the benefit of employees, officers or directors, consultantsof the Borrower (or any direct or indirect parent thereof), independent contractors the Borrower or other service providers any Restricted Subsidiary or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the Borrower;
(wq) to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials or equipment or purchases, acquisitions, licenses or leases of any other assets, Intellectual Propertyintellectual property, or other rights, in each case in the ordinary course of business;
(xr) Investments by an Unrestricted in any Subsidiary entered into prior to the day such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to the definition of “Unrestricted Subsidiary”;
(y) Investments consisting of purchases of assets of Franchisees (including, but not limited to, area development contracts owned by Franchisees) or any joint venture in connection with intercompany cash management arrangement or related activities arising in the ordinary course of business or otherwise in an amount not exceeding $60,000,000, so long as (A) no Event of Default shall have occurred and be continuing and (B) the Borrower is in pro forma compliance consistent with the Financial Covenant after giving effect to any such purchasepast practice;
(zs) So long as no Event of Default shall have occurred and be continuing, Investments in Franchisees (including, but not limited to, (i) Guarantees or other credit support of any Indebtedness unfunded pension fund and other employee benefit plan obligations and liabilities thereof and (ii) loans, advances or contributions to the marketing and advertising funds operating in connection with extent that the European Wax Center franchise systems) not same are permitted to exceed the greater remain unfunded under applicable Requirements of $20,000,000 and 70% of Consolidated EBITDALaw;
(aat) Hedging Agreements entered into for non-speculative purposes;
(u) Investments consisting of accounts resulting from pledges and payment intangibles owing to the Borrower or any of the Restricted Subsidiaries from Franchisees; provided that such obligation shall be on such terms as the Borrower or the applicable Restricted Subsidiary establishes in good faith; and
deposits under Xxxxxxxx 0.00(x), (bb) Investments consisting of advances or expenditures by any Loan Party tox), or on behalf of(x), any CMF Subsidiary in support of advertising and marketing programs in the ordinary course consistent with current practices. For purposes of determining compliance with this Section 6.04(x), in the event that any item of Investment meets the criteria of more than one of the categories of Investments described in clauses (a) through x), (bb) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such Investment (or any portion thereofxx) and will only be required to include the amount and type of such Investment in one or more of the above clauses.(hh);
Appears in 1 contract
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings Indemnitor nor the Borrower will, nor will they permit any Indemnitor Group Restricted Subsidiary or Intermediate Parent to, make or hold any Investment, except:
(a) Permitted Investments at the time such Permitted Investment is madeand cash;
(b) investments constituting the purchase or other acquisition (in one transaction or a series of related transactions) of all or substantially all of the property and assets or business of any Person or of assets constituting a business unit, a line of business or division of such Person, or the Equity Interests in a Person that, upon the consummation thereof, will be a Indemnitor Group Restricted Subsidiary if, after giving effect thereto on a Pro Forma Basis, the Borrower would be in compliance with Section 3.12 and Section 3.13; provided that the aggregate amount of cash consideration paid in respect of such investments (including in the form of loans or advances made to officers, directors and employees of Holdings, any Intermediate Parent, the Borrower and the Indemnitor Group Restricted Subsidiaries (ithat are not Loan Parties) for reasonable and customary business-related travelby Loan Parties involving the acquisition of Indemnitor Group Restricted Subsidiaries that do not become Loan Parties shall not, entertainment, relocation and analogous ordinary business purposes, (ii) in connection with such Person’s purchase of Equity Interests in Holdings (or any direct or indirect parent thereof) (provided that the amount of such loans and advances made in cash to such Person shall be contributed to the Borrower in cash as common equity or Qualified Equity Interests) and (iii) for purposes not described in the foregoing clauses (i) and (ii); provided that at the time of incurrence thereof such investment is made and after giving Pro Forma Effect effect thereto, cause the Non-Guarantor Investment Basket to be exceeded (provided, that to the extent such Indemnitor Group Restricted Subsidiaries do become Loan Parties, the aggregate principal amount outstanding in reliance on this clause (iiib) shall not exceed $1,000,000be reduced by the amount initially utilized);
(c) Investments by Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary in any of Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary; provided that the aggregate outstanding amount of Investments made by Loan Parties in Restricted Subsidiaries that are not Loan Parties in reliance on this clause (c) shall not exceed the greater of $10,000,000 and 35% of Consolidated EBITDA[Reserved];
(d) Investments consisting of prepayments to suppliers in the ordinary course of business;
(e) Investments consisting of extensions of trade credit in the ordinary course of business;
(f) Investments (i) existing or contemplated on the date hereof Amendment and Restatement Effective Date and to the extent having a principal amount in excess of $5,000,000 individually set forth on Schedule 6.04(f6.04 of the Current Credit Agreement (as in effect on the Amendment and Restatement Effective Date) and any modification, replacement, renewal, reinvestment or extension thereof thereof;
(e) Investments by Indemnitor in the Borrower and by Indemnitor, the Borrower and the Indemnitor Group Restricted Subsidiaries in Equity Interests of their respective Restricted Subsidiaries; provided that the making of any Investment by any Loan Party in any Indemnitor Group Restricted Subsidiary that is not a Loan Party shall not, at the time such Investment is made and after giving effect thereto, cause the Non-Guarantor Investment Basket to be exceeded, provided that if any such investment under this Section 3.04(e) is made for the purpose of making an investment, loan or advance permitted under Section 3.04(u), the amount available under this Section 3.04(e) shall not be reduced by the amount of any such investment, loan or advance which reduces the basket under Section 3.04(u);
(f) loans or advances made by Holdings or the Borrower to any Restricted Subsidiary and made by any Restricted Subsidiary to the Borrower or any other Restricted Subsidiary; provided that (i) [reserved] and (ii) Investments existing on the date hereof outstanding amount of such loans and advances made by Loan Parties to Restricted Subsidiaries that are not Loan Parties at the time such loans or advances are made, and after giving effect thereto, shall not cause the Non- Guarantor Investment Basket to be exceeded, provided that any intercompany loans or advances made by any Loan Party to any Restricted Subsidiary that is not a Loan Party using the proceeds of intercompany loans or advances received from Restricted Subsidiaries that are not Loan Parties no more than 120 days prior to making such intercompany loan or advance shall not be taken into account in the calculation of any restriction or basket set forth in this subclause (ii) (including the Non-Guarantor Investment Basket); provided further that if any such loan or advance under this subclause (ii) is made for the purpose of making an investment, loan or advance permitted under Section 3.04(u), the amount available under this clause (f) shall not be reduced by the amount of any such investment, loan or advance which reduces the basket under Section 3.04(u), provided further that any loan or advance made by any Loan Party to a Restricted Subsidiary that is not a Loan Party, for the purposes of calculating usage under this subclause (ii) and the Non- Guarantor Investment Basket, shall be reduced dollar-for-dollar by any amounts owed by such Loan Party to such Restricted Subsidiary that is not a Loan Party;
(g) Debt-Related Guarantees by Holdings, the Borrower or any Restricted Subsidiary in respect of Indebtedness permitted under Section 3.01 and in respect of other obligations not otherwise contemplated by this Section 3.04, in each case of Holdings, the Borrower or any Restricted Subsidiary; provided that any such Debt-Related Guarantees of Indebtedness and such other obligations, in each case of Restricted Subsidiaries that are not Loan Parties by any Loan Party (other than with respect to Cash Management Financing Facilities) shall not, at the time any such Debt-Related Guarantee is provided and after giving effect thereto, cause the Non-Guarantor Investment Basket to be exceeded;
(h) loans or advances to directors, officers, consultants or employees of Holdings, the Borrower or any Restricted Subsidiary and any modification, renewal or extension thereof; provided that the amount of the original Investment is not increased except by the terms of such Investment to the extent as set forth on Schedule 6.04(f) or as otherwise permitted by this Section 6.04;
(g) Investments in Swap Agreements permitted under Section 6.01(a)(vi);
(h) promissory notes and other non-cash consideration received in connection with Dispositions permitted by Section 6.05;
(i) Permitted Acquisitions;
(j) the Transactions;
(k) Investments made in the ordinary course of business consisting of endorsements for collection Holdings, the Borrower or deposit and customary trade arrangements with customers consistent with past practicessuch Restricted Subsidiary, as applicable, not exceeding $10,000,000 in the aggregate outstanding at any time (determined without regard to any write-downs or write- offs of such loans or advances);
(li) Investments payroll, travel and similar advances to cover matters that are expected at the time of such advances ultimately to be treated as expenses of Holdings, the Borrower or any Restricted Subsidiary for accounting purposes and that are made in the ordinary course of business;
(including debt obligations and Equity Interestsj) investments received in connection with the bankruptcy or reorganization of suppliers and customersof, from financially troubled account debtors or in settlement of delinquent obligations of, or other accounts and disputes with, customers and suppliers or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment;
(m) loans and advances to Holdings (or any direct or indirect parent thereof) or any Intermediate Parent , in lieu of, and not in excess of the amount of (after giving effect to any other loans, advances or Restricted Payments in respect thereof), Restricted Payments to the extent permitted to be made to Holdings (or such parent) or such Intermediate Parent in accordance with Section 6.08(a);
(n) additional Investments and other acquisitions; provided that at the time any such Investment or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition made in reliance on this clause (n), together with the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (n), shall not exceed the sum of (A) the greater of $18,000,000 and 60% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Investment or other acquisition, plus (B) so long as no Event of Default has occurred and is continuing, the Available Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of such Investment;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby;
(p) advances of payroll payments to employees each case in the ordinary course of business;
(qk) Investments and other acquisitions investments in the form of Hedging Agreements permitted by Section 3.07 (including any Back to Back Arrangements);
(l) investments of any Person existing at the extent that payment for time such Investments is Person becomes a Indemnitor Group Restricted Subsidiary or consolidates or merges with the Borrower or any Indemnitor Group Restricted Subsidiary so long as such investments were not made with Qualified Equity Interests in contemplation of such Person becoming a Indemnitor Group Restricted Subsidiary or of such consolidation or merger;
(excluding Cure Amountsm) investments resulting from pledges or deposits described in clause (c) or (d) of Holdings the definition of the term “Permitted Encumbrance” as defined in the Current Credit Agreement (as in effect on the Amendment and Restatement Effective Date);
(n) investments made as a result of the receipt of noncash consideration from a sale, transfer, lease or other disposition of any asset in compliance with Section 3.05;
(o) investments that result solely from the receipt by Indemnitor, the Borrower or any direct Indemnitor Group Restricted Subsidiary from any of its Subsidiaries of a dividend or indirect parent thereof other Restricted Payment in the form of Equity Interests, evidences of Indebtedness or other securities (but not any additions thereto made after the IPO Entitydate of the receipt thereof);
(p) receivables or other trade payables owing to Indemnitor, the Borrower or a Restricted Subsidiary if created or acquired in the ordinary course of business and payable or dischargeable in accordance with customary trade terms; provided that (i) such amounts used pursuant to this clause trade terms may include such concessionary trade terms as Indemnitor, the Borrower or any Restricted Subsidiary deems reasonable under the circumstances;
(q) shall mergers and consolidations permitted under Section 3.03 that do not increase involve any Person other than Holdings, the Available Amount Borrower and (ii) any amounts used for such an Investment or other acquisition Restricted Subsidiaries that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof or the IPO Entity) shall otherwise be permitted pursuant to this Section 6.04wholly owned Restricted Subsidiaries;
(r) Investments in the form of a letters of credit, bank guarantees, performance bonds or similar instruments or other creditor support or reimbursement obligations made in the ordinary course of business by Holdings or the Borrower on behalf of any Restricted Subsidiary acquired and made by any Restricted Subsidiary on behalf of the Borrower or any other Restricted Subsidiary; provided that at the time such letters of credit, bank guarantees, performance bonds or similar instruments or other creditor support or reimbursement obligations are made by Loan Parties on behalf of Restricted Subsidiaries that are not Loan Parties pursuant to this Section 3.04(r), and after giving effect thereto, such obligations shall not cause the Non- Guarantor Investment Basket to be exceeded;
(s) Debt-Related Guarantees by Indemnitor, the Borrower or any Restricted Subsidiary of leases (other than Capitalized Leases) or of other obligations that do not constitute Indebtedness, in each case entered into in the ordinary course of business;
(t) Investments, so long as, after giving effect thereto, the Consolidated Total Leverage Ratio does not exceed 1.75:1.00;
(u) other Investments by Indemnitor, the Borrower or any Indemnitor Restricted Subsidiary (and loans and advances by Indemnitor) in an aggregate amount, as valued at cost at the time each such Investment is made and including all related commitments for future Investments (and the principal amount of any Indebtedness that is assumed or otherwise incurred in connection with such Investment), outstanding under this Section 3.04(u) at any time in an aggregate amount not exceeding the sum of (i) the greater of (x) $300,000,000 and (y) 75% of LTM Consolidated EBITDA plus (ii) so long as no Credit Default has occurred and is continuing or would result therefrom, the Available Amount at such time in the aggregate for all such investments made or committed to be made from and after the Effective Date plus an amount equal to any returns of capital or sale proceeds actually received in cash in respect of a Person merged or consolidated with any Subsidiary in accordance with this Section and Section 6.03 after the Effective Date to the extent that such Investments were (which amount shall not made in contemplation of or in connection with such acquisition, merger or consolidation and were in existence on exceed the date amount of such acquisition, merger or consolidationInvestment valued at cost at the time such investment was made);
(sv) Investments consisting of (i) extensions of trade credit and accommodation guarantees in the ordinary course of business and (ii) loans and advances to customers; provided that the aggregate principal amount of such loans and advances outstanding under this clause (ii) at any time shall not exceed $10,000,000;
(w) [Reserved];
(x) Investments in the ordinary course of business consisting of Uniform Commercial Code Article 3 endorsements for collection or deposit and Uniform Commercial Code Article 4 customary trade arrangements with customers in the ordinary course of business;
(y) Investments (A) for utilities, security deposits, leases and similar prepaid expenses incurred in the ordinary course of business and (B) in the form of trade accounts created, or prepaid expenses accrued, in the ordinary course of business;
(z) non-cash Investments in connection with tax planning and reorganization activities;
(aa) customary Investments in connection with Permitted Receivables Facilities;
(bb) Investments in joint ventures and Unrestricted Subsidiaries; provided that after giving effect to at the time of any such activities, the security interests of the Lenders in the Collateral, taken as a whole, would not be materially impaired;
(t) Investments consisting of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference to this Section 6.04(t)) under Sections 6.01, 6.02, 6.03, 6.05 and 6.08, respectively;
(u) additional Investments; provided that after giving effect to such Investment (A) on a Pro Forma Basis, the Total Net Leverage Ratio is less than or equal to 4.50 to 1.00 aggregate amount at any time outstanding of all such Investments made in reliance on this clause (bb) shall not exceed the greater of (x) $50,000,000 and (By) there is no continuing Event 12% of DefaultLTM Consolidated EBITDA;
(vcc) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors Investments in the case form of a bankruptcy of Holdings loans or the Borrower;
(w) advances made to the extent that they constitute Investments, purchases distributors and acquisitions of inventory, supplies, materials or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Property, or other rights, in each case suppliers in the ordinary course of business;; and
(xdd) Investments by an Unrestricted Subsidiary entered into prior to the day such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to the definition of “Unrestricted Subsidiary”;
(y) Investments consisting of purchases of assets of Franchisees (includingextent they constitute Investments, but not limited to, area development contracts owned by Franchisees) guaranties in the ordinary course of business or otherwise in an amount not exceeding $60,000,000of the obligations of suppliers, so long as (A) no Event customers, franchisees, lessors and licensees of Default shall have occurred and be continuing and (B) the Borrower is in pro forma compliance with the Financial Covenant after giving effect to and any such purchase;
(z) So long as no Event of Default shall have occurred and be continuing, Investments in Franchisees (including, but not limited to, (i) Guarantees or other credit support of any Indebtedness and other liabilities thereof and (ii) loans, advances or contributions to the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater of $20,000,000 and 70% of Consolidated EBITDA;
(aa) Investments consisting of accounts and payment intangibles owing to the Borrower or any of the Restricted Subsidiaries from Franchisees; provided that such obligation shall be on such terms as the Borrower or the applicable Restricted Subsidiary establishes in good faith; and
(bb) Investments consisting of advances or expenditures by any Loan Party to, or on behalf of, any CMF Subsidiary in support of advertising and marketing programs in the ordinary course consistent with current practicesSubsidiary. For purposes of determining compliance with this Section 6.043.04, in the event that if any item of Investment meets the criteria of more than one of the categories of Investments described in clauses (a) through (bb) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such Investment (or any a portion thereof) and will only would be required permitted pursuant to include the amount and type of such Investment in one or more of the provisions described above clausesand/or one or more of the exceptions contained in this Section 3.04 (other than ratio-based baskets, if any), Indemnitor, the Borrower and the Indemnitor Group Restricted Subsidiaries may divide and classify such Investment (or a portion thereof) in any manner that complies with this covenant and may later divide and reclassify any such Investment so long as the Investment (as so divided and/or reclassified) would be permitted to be made in reliance on the applicable exception as of the date of such reclassification.
Appears in 1 contract
Samples: Indemnification and Reimbursement Agreement (Resideo Technologies, Inc.)
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor the The Borrower willwill not, nor and will they not permit any of its Restricted Subsidiaries to purchase, hold or acquire (including pursuant to any merger with any Person that was not a Wholly Owned Restricted Subsidiary prior to such merger) any Equity Interests in or Intermediate Parent toevidences of Indebtedness or other securities (including any option, warrant or other right to acquire any of the foregoing) of, make or hold permit to exist any loans or advances to, or otherwise lend money to, Guarantee any Indebtedness of, or make or permit to exist any investment in, any other Person or provide other credit support (including the provision of letters of credit for the account of such Person) for any Person or purchase or otherwise acquire (in one transaction or a series of transactions) any assets of any other Person constituting a business unit, line of business or division (each of the foregoing, an “Investment” and collectively, “Investments”), except:
(ai) cash and Permitted Investments at the time such Permitted Investment is madeInvestments;
(b) loans or advances to officers, directors and employees of Holdings, any Intermediate Parent, the Borrower and the Restricted Subsidiaries (i) for reasonable and customary business-related travel, entertainment, relocation and analogous ordinary business purposes, (ii) in connection with such Person’s purchase of Equity Interests in Holdings Investments existing on the Effective Date and set forth on Schedule 6.04; provided that to the extent any loan described on Schedule 6.04 that is owing by a Subsidiary that is not a Loan Party to a Loan Party (the “Scheduled Loans”) (or any direct or indirect parent thereof) (provided that the amount of such loans and advances made in cash to such Person shall be contributed to the Borrower in cash as common equity or Qualified Equity Interests) and (iii) for purposes not described in the foregoing clauses (i) and (ii); provided that at the time of incurrence thereof and after giving Pro Forma Effect thereto, the aggregate principal amount outstanding in reliance on this clause (iii) shall not exceed $1,000,000;
(c) Investments by Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary in any of Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary; provided that the aggregate outstanding amount of additional Investments made by Loan Parties pursuant to this proviso) has been repaid, then additional Investments may be made by Loan Parties in any Restricted Subsidiaries that are not Loan Parties in reliance on an aggregate amount up to the amount actually received by Loan Parties as payment in respect of such Investments; provided further that in no event will the aggregate amount of Scheduled Loans and additional Investments made by Loan Parties in Subsidiaries that are not Loan Parties pursuant to the first proviso of this clause (cii) shall not exceed the greater aggregate original principal amount of $10,000,000 and 35% of Consolidated EBITDAthe Scheduled Loans on the Effective Date;
(d) Investments consisting of prepayments to suppliers in the ordinary course of business;
(e) Investments consisting of extensions of trade credit in the ordinary course of business;
(fiii) Investments (ix) existing or contemplated on among the date hereof and set forth on Schedule 6.04(fLoan Parties, (y) and by any modification, replacement, renewal, reinvestment or extension thereof and (ii) Investments existing on the date hereof by Holdings, the Borrower or any Non-Guarantor Restricted Subsidiary in the Borrower or any Restricted Subsidiary and (z) by any modificationLoan Party in any 112-112- Non-Guarantor Restricted Subsidiary in an aggregate amount outstanding at any time pursuant to this subclause (z) not to exceed the sum of (1) $300 million, renewal or extension thereof; provided that plus (2) the amount of proceeds of unsecured Permitted Other Debt and the original Investment is proceeds from any borrowings of Incremental Term Loans, in each case, that are incurred after the Effective Date (and that are not increased except by applied to refinance other Indebtedness or to make an acquisition in reliance on clause (d)(iii)(2) of the terms definition of such Investment to the extent as set forth on Schedule 6.04(f) or as otherwise permitted by this Section 6.04;
(g) Investments in Swap Agreements permitted under Section 6.01(a)(viPermitted Acquisition);
(hiv) promissory notes and other nonGuarantees by any Non-cash consideration received in connection with Dispositions U.S. Restricted Subsidiary that is a Non-Guarantor Restricted Subsidiary of Indebtedness permitted by Section 6.056.01(xii);
(i) Permitted Acquisitions;
(j) the Transactions;
(kv) Investments in the ordinary course of business consisting of endorsements for collection or deposit and customary trade arrangements with customers consistent with past practices;
(l) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers and customersof, from financially troubled account debtors or in settlement of delinquent obligations of, or other accounts and disputes with, customers and suppliers or upon trade creditors, in each case in the foreclosure with respect to any secured Investment or other transfer ordinary course of title with respect to any secured Investmentbusiness of the Borrower and its Restricted Subsidiaries;
(mvi) loans and advances to Holdings directors and employees of the Borrower or its Restricted Subsidiaries in the ordinary course of business of the Borrower and its Restricted Subsidiaries (including for travel, entertainment and relocation expenses) (other than any loans or advances to any director or executive officer (or any direct or indirect parent equivalent thereof) or that would violate any Intermediate Parent Requirement of Law in lieu of, and not any material respect) in excess of the an aggregate principal amount of (after giving effect determined without regard to any other loans, advances write-downs or Restricted Payments in respect thereof), Restricted Payments write-offs of such loans and advances) not to the extent permitted to be made to Holdings (or such parent) or such Intermediate Parent in accordance with Section 6.08(a)exceed $5.0 million at any one time outstanding;
(nvii) additional Permitted Acquisitions;
(viii) Investments and other acquisitions; provided that at the time any such Investment in Joint Ventures (A) constituting or consisting of a contribution of or other acquisition is madetransfer or distribution of the assets (other than cash, except that a de minimis cash amount directly related to such assets may be contributed, transferred or otherwise distributed) or capital stock of the Specified Businesses or (B) Investments in Joint Ventures not described in clause (A) in an aggregate outstanding amount of such Investment or acquisition made in reliance on under this clause (n)B) not to exceed $100.0 million at any one time outstanding;
(ix) mergers and consolidations and dissolutions and other transactions permitted under Section 6.03;
(x) Hedging Agreements permitted under Section 6.146.13;
(xi) Investments in deposit accounts in the ordinary course of business of the Borrower and its Restricted Subsidiaries;
(xii) security deposits required by utility companies and other Persons in a similar line of business to that of utility companies and Governmental Authorities that are utility companies, together with in each case, made in the ordinary course of business of the Borrower and its Restricted Subsidiaries;
(xiii) other Investments in an aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (n), shall at any time outstanding not to exceed the sum of (A) the greater of (x) $18,000,000 75.0 million and 60(y) 3.0% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of Net Tangible Assets at such Investment or other acquisition, time plus (B) so long as no Event the portion, if any, of Default has occurred and is continuing, the Available Amount on the date of such election that is Not Otherwise Applied as Borrower elects to apply to this Section 6.04(xiii); provided that (A) any such Investment held by a Loan Party shall be pledged pursuant to a Pledge Agreement or a Non-U.S. Pledge Agreement in effect immediately prior accordance with, and to the time extent required by, Section 5.11 and (B) any such Investment in the 113-113- form of making of such Investmenta loan or advance to any Loan Party shall be subordinated to the Obligations on terms reasonably satisfactory to the Administrative Agent;
(oxiv) Holdings Investments consisting of any non-cash portion or any deferred portion (including promissory notes, equity interests and its Subsidiaries may undertake other non-cash consideration) of the sales price received by the Borrower or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated therebyRestricted Subsidiary in connection with any Asset Sale permitted under Section 6.05;
(pxv) advances of payroll payments to employees in the ordinary course of business;
(qxvi) Investments constituting or resulting from (i) accounts receivable arising or acquired or (ii) trade debt granted, in each case in the ordinary course of business;
(xvii) Investments in respect of Treasury Services Agreements permitted under Section 6.01(x);
(xviii) Investments constituting (A) Sale and Leaseback Transactions permitted under Section 6.06 or (B) Restricted Payments permitted under Section 6.07 or (C) resulting from pledges or deposits permitted under Section 6.02;
(xix) the endorsement of negotiable instruments for deposit or collection in the ordinary course of business;
(xx) intercompany receivables created by any distribution or other acquisitions transfer by a Subsidiary to the extent a Loan Party of an intercompany receivable issued by a Subsidiary that payment for such Investments is made with Qualified Equity Interests (excluding Cure Amounts) of Holdings (or any direct or indirect parent thereof or the IPO Entity)not a Guarantor; provided that (i) any Loan Party shall pledge any note evidencing any such amounts used pursuant to this clause (q) shall not increase the Available Amount and (ii) any amounts used for receivable that it receives as a result of such an Investment distribution or other acquisition transfer; provided further, that are not Qualified Equity Interests no Loan Party shall transfer, or otherwise make any payment or other Investment of, cash or cash equivalents in exchange for the receipt of Holdings (or any direct or indirect parent thereof or the IPO Entity) shall otherwise be permitted pursuant to this Section 6.04such intercompany receivables;
(rxxi) any transfer of assets pursuant to SectionSections 6.05(vii), (xi), (xvi), (xx) or Section 6.05(xx(xxii) in the form of an Investment;
(xxii) the Contemplated Acquisitions;
(xxiii) Investments of a Subsidiary acquired after the Effective Date or of a Person merged into the Borrower or consolidated with any Subsidiary of its Subsidiaries in accordance with this Section and Section 6.03 after the Effective Date to the extent that such Investments were Investment was not made in contemplation of or in connection with such acquisition, merger or consolidation and consolidation, were in existence on the date of such acquisition, merger or consolidation;consolidation and are not a material portionmajority of such Subsidiary’s assets; and
(s) non-cash Investments in connection with tax planning and reorganization activities; provided that after giving effect to any such activities, the security interests of the Lenders in the Collateral, taken as a whole, would not be materially impaired;
(txxiv) Investments consisting of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference to this Section 6.04(t)) under Sections 6.01, 6.02, 6.03, 6.05 and 6.08, respectively;
(u) additional Investments; provided that after giving effect to such Investment (A) on a Pro Forma Basis, the Total Net Leverage Ratio is less than or equal to 4.50 to 1.00 and (B) there is no continuing Event of Default;
(v) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the Borrower;
(w) to the extent that they constitute Investmentspayment for such Investment is made with Equity Interests or Equity Rights (other than Disqualified Equity Interests) of the Borrower; provided, purchases and acquisitions of inventoryhowever, supplies, materials or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Property, or other rights, in each case that any intercompany Investments in the ordinary course form of business;
(x) Investments a loan or advance held by an Unrestricted Subsidiary entered into prior a Loan Party shall be evidenced by a promissory note in form and substance reasonably satisfactory to the day such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to the definition of “Unrestricted Subsidiary”;
(y) Investments consisting of purchases of assets of Franchisees (includingAdministrative Agent; provided, but not limited tofurther, area development contracts owned by Franchisees) in the ordinary course of business or otherwise in that if an amount not exceeding $60,000,000, so long as (A) no Event of Default shall have occurred and be continuing and (B) the Borrower is in pro forma compliance with the Financial Covenant after giving effect to any such purchase;
(z) So long as no Event of Default shall have occurred and be continuing, Investments in Franchisees (including, but not limited to, (i) Guarantees or other credit support of any Indebtedness and other liabilities thereof and (ii) loans, advances or contributions to the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater of $20,000,000 and 70% of Consolidated EBITDA;
(aa) Investments consisting of accounts and payment intangibles owing to the Borrower or any of the Restricted Subsidiaries from Franchisees; provided that such obligation shall be on such terms as the Borrower or the applicable Restricted Subsidiary establishes in good faith; and
(bb) Investments consisting of advances or expenditures by any Loan Party to, or on behalf of, any CMF Subsidiary in support of advertising and marketing programs in the ordinary course consistent with current practices. For purposes of determining compliance with this Section 6.04, in the event that any item of Investment meets the criteria of more than one of the categories types of Investments described in the clauses (a) through (bb) above, Holdings shall, the Borrower in its sole discretion, discretion may classify and reclassify such action or later divide, classify or reclassify such Investment (or any portion thereof) and will only be required to include the amount and type of such Investment event in one or more clauses (including in part under one such clause and in part under another such clause). The aggregate amount of an Investment at any one time outstanding for purposes of this Section 6.04 shall be deemed to be equal to (A) the above clausesaggregate amount of cash, together with the aggregate fair market value of Property (net of any Transferred Liability), loaned, advanced, contributed, transferred or otherwise invested that gives rise to such Investment (without adjustment for subsequent increases or decreases in the value of such Investment) minus (B) the aggregate amount of dividends, distributions or other payments received in cash in respect of such Investment (including by way of a sale or other disposition of such Investment). In the event that a Loan Party makes an Investment in a Non-Guarantor Restricted Subsidiary for purposes of permitting such Non-Guarantor Restricted Subsidiary or any other Non-Guarantor Restricted Subsidiary to apply the amounts received to make a substantially concurrentan Investment (which may be made through any other Non-Guarantor Restricted Subsidiary) in any other Person (that is not also a Non-Guarantor Restricted Subsidiary), or to acquire any assets, business, division that is not owned by a Non-Guarantor Restricted Subsidiary, the Investment by such Loan Party in such Non-Guarantor Restricted Subsidiary shall not be included as an Investment for purposes of this Section 6.04 to the extent the subsequent Investment by such Non-Guarantor Restricted Subsidiary reduced amounts available to make Investments hereunder. The amount of an Investment shall not in any event be reduced by reason of any write-off of such Investment.
Appears in 1 contract
Samples: Credit Agreement (Solutia Inc)
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor the Borrower will, nor will they permit any Restricted Subsidiary or Intermediate Parent to, make or hold any Investment, except:
(a) Permitted Investments at the time such Permitted Investment is madeInvestments;
(b) loans or advances to officers, directors and employees of Holdings, any Intermediate Parent, the Borrower and the its Restricted Subsidiaries (i) for reasonable and customary business-related travel, entertainment, relocation and analogous ordinary business purposes, (ii) in connection with such Person’s purchase of Equity Interests in of Holdings (or any direct or indirect parent thereofthereof or any Employee Holding Vehicle) (provided that the amount of such loans and advances made in cash to such Person shall be contributed to the Borrower in cash as common equity or Qualified Equity Interests) and (iii) for purposes not described in the foregoing clauses (i) and (ii); provided that at the time of incurrence thereof and after giving Pro Forma Effect thereto, the in an aggregate principal amount outstanding at any time not to exceed $5,000,000;
(c) Investments (%3) by Holdings, the Borrower or any Restricted Subsidiary in any Loan Party (excluding any new Restricted Subsidiary that becomes a Loan Party pursuant to such Investment), (%3) by any Restricted Subsidiary that is not a Loan Party in any other Restricted Subsidiary that is also not a Loan Party, (%3) by Holdings or any Restricted Subsidiary (%5) in any Restricted Subsidiary; provided that the aggregate amount of such Investments made by Loan Parties after the Restatement Effective Date in Restricted Subsidiaries that are not Loan Parties in reliance on this clause (iiiiii)(A) (including any such Investments deemed to be made pursuant to Section 6.14) (together with the amount of Investments made in Restricted Subsidiaries (other than Regulated Subsidiaries) that are not Loan Parties pursuant to Section 6.04(h) and the amount of Investments and acquisitions made pursuant to Section 6.04(m), in each case, after the Restatement Effective Date) shall not exceed $1,000,000;
the Non-Loan Party Investment Amount at the time of any such Investment, (c%5) Investments in any Regulated Subsidiary in the form of short-term intercompany advances and Indebtedness, in each case made in the ordinary course of business to provide for working capital and other operational requirements of such Regulated Subsidiary, (%5) in any Restricted Subsidiary that is not a Loan Party, constituting an exchange of Equity Interests of such Restricted Subsidiary for Indebtedness of such Subsidiary, (%5) constituting Guarantees of Indebtedness or other monetary obligations of Restricted Subsidiaries that are not Loan Parties owing to any Loan Party or (%5) constituting unsecured Guarantees of Trading Debt to the extent such Guarantees are permitted under Section 6.01(a)(iii), (%3) by Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary in any of Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary; provided that the aggregate outstanding amount of Investments made by Loan Parties in Restricted Subsidiaries that are not Loan Parties so long as such Investment is part of a series of simultaneous transactions that result in reliance on this clause the proceeds of the initial transaction being invested in one or more Loan Parties or, if the proceeds were initially held by a non-Loan Party, in a Restricted Subsidiary that is not a Loan Party and (c%3) shall by Holdings, the Borrower or any Restricted Subsidiary in any Restricted Subsidiary that is not exceed a Loan Party, consisting of the greater contribution of $10,000,000 and 35% Equity Interests of Consolidated EBITDAany other Restricted Subsidiary that is not a Loan Party so long as the Equity Interests of the transferee Restricted Subsidiary is pledged to secure the Secured Obligations;
(d) Investments consisting of prepayments to suppliers in the ordinary course of business;
(e) Investments consisting of extensions of trade credit in the ordinary course of business;
(fe) Investments (i) existing or contemplated on the date hereof Restatement Effective Date and set forth on Schedule 6.04(f6.04(e) and any modification, replacement, renewal, reinvestment or extension thereof and (ii) Investments existing on the date hereof Restatement Effective Date by Holdings, the Borrower or any Restricted Subsidiary in the Borrower or any Restricted Subsidiary and any modification, renewal or extension thereof; provided that in each case the amount of the original Investment is not increased except by the terms of such Investment to the extent as set forth on Schedule 6.04(f6.04(e) or as otherwise permitted by this Section 6.04;
(gf) Investments in Swap Agreements permitted under Section 6.01(a)(vi)6.07;
(hg) promissory notes and other non-cash consideration received in connection with Dispositions permitted by Section 6.05;
(ih) Permitted Acquisitions; provided that the aggregate amount of consideration paid or provided by Holdings, any Intermediate Parent, the Borrower or any other Loan Party (including any Indebtedness incurred by any such Person to finance any portion of such consideration) after the Restatement Effective Date in reliance on this Section 6.04(h) (together with any Investments made in Subsidiaries that are not Loan Parties pursuant to Section 6.04(c)(c)(c), Investments deemed to be made pursuant to Section 6.14 and the amount of Investments and acquisitions made pursuant to Section 6.04(m), in each case, after the Restatement Effective Date) for Permitted Acquisitions (including the aggregate principal amount of all Indebtedness assumed in connection with Permitted Acquisitions) of any Restricted Subsidiary (other than a Regulated Subsidiary) that shall not be or, after giving effect to such Permitted Acquisition, shall not become, a Loan Party, shall not exceed the Non-Loan Party Investment Amount at such time;
(i) prior to the Escrow Assumption Date, Investments in the Escrow Borrower to fund interest and other amounts owing or required to be pre-funded with respect to the Escrow Term Loans and, to the extent applicable, interest and other amounts owing or required to be pre-funded in respect of the Second Lien Notes;
(j) the Transactions;
(k) Investments in the ordinary course of business consisting of Uniform Commercial Code Article 3 endorsements for collection or deposit and Uniform Commercial Code Article 4 customary trade arrangements with customers consistent with past practices;
(lk) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers and customers, from financially troubled account debtors customers or in settlement of delinquent obligations of, or other disputes with, customers and suppliers or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment;
(ml) loans and advances to Holdings (or any direct or indirect parent thereof) or any Intermediate Parent in lieu of, and not in excess of the amount of (after giving effect to any other loans, advances or Restricted Payments in respect thereof), Restricted Payments to the extent permitted to be made to Holdings (or such parent) or such Intermediate Parent in accordance with Section 6.08(a6.08(a)(iv), (v), (vi), (vii) or (viii);
(nm) additional so long as immediately after giving effect to any such Investment or acquisition no Default shall have occurred and be continuing, other Investments and other acquisitions; provided that at the time any such Investment (including any such Investments deemed to be made pursuant to Section 6.14) or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition all Investments made in reliance on this clause (nm) (including all such Investments deemed made pursuant to Section 6.14), Investments made in Subsidiaries that are not Loan Parties pursuant to Section 6.04(c)(iii)(A) and Investments made in Restricted Subsidiaries (other than Regulated Subsidiaries) that are not Loan Parties pursuant to Section 6.04(h), together with the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (nm) (including the aggregate principal amount of all Indebtedness assumed in connection with any such other acquisition), in each case, after the Restatement Effective Date, shall not exceed the sum Non-Loan Party Investment Amount at the time of (A) the greater of $18,000,000 and 60% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of any such Investment or other acquisition, plus (B) so long as no Event of Default has occurred and is continuing, the Available Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of such Investment;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby;
(pn) advances of payroll payments to employees in the ordinary course of business;
(qo) Investments and other acquisitions to the extent that payment for such Investments is made solely with Qualified Equity Interests (excluding Cure Amounts) of Holdings (or any direct or indirect parent thereof or the IPO Entitythereof); provided that (i) such amounts used pursuant to this clause (q) shall not increase the Available Amount and (ii) any amounts used for such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof or the IPO Entity) shall otherwise be permitted pursuant to this Section 6.04;
(rp) Investments of a Subsidiary acquired after the Restatement Effective Date or of a Person merged or consolidated with any Subsidiary in accordance with this Section and Section 6.03 after the Restatement Effective Date (other than existing Investments in subsidiaries of such Subsidiary or Person, which must comply with the requirements of Section 6.04(h) or 6.04(m)) to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger or consolidation and were in existence on the date of such acquisition, merger or consolidation;
(sq) Investments made or acquired in the ordinary course trading activities of the Borrower and its Restricted Subsidiaries;
(r) non-cash Investments in connection with tax planning and reorganization activities; provided that after giving effect to any such activities, the security interests of the Lenders in the Collateral, taken as a whole, would not be materially impaired;
(s) Investments in any Foreign Subsidiary made for the purposes of providing such Foreign Subsidiary the necessary capital to comply with any capital or margin requirements of a Regulatory Supervisory Organization; provided that the aggregate outstanding amount of Investments made pursuant to this clause shall not exceed $25,000,000 at any time;
(t) if the Escrow Assumption occurs, Investments consisting as a result of Indebtednessthe Transactions, Liensincluding, fundamental changeswithout limitation, Dispositions Investments of a Subsidiary acquired in the Merger and Restricted Payments permitted (other than by reference Contribution to this Section 6.04(t)) under Sections 6.01, 6.02, 6.03, 6.05 and 6.08, respectively;the extent that such Investments are in existence on the Escrow Assumption Date; and
(u) additional Investments; provided that after giving effect to such Investment (A) on a Pro Forma BasisInvestments in market structure companies, the Total Net Leverage Ratio is less than or equal to 4.50 to 1.00 including securities exchanges, venues and (B) there is no continuing Event of Default;
(v) contributions to a “rabbi” trust for the benefit of employeesclearing firms, directors, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the Borrower;
(w) to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Property, or other rights, in each case in the ordinary course of business;
; provided, that the aggregate amount of Investments at any one time outstanding under this clause (x) Investments by an Unrestricted Subsidiary entered into prior to the day such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to the definition of “Unrestricted Subsidiary”;
(y) Investments consisting of purchases of assets of Franchisees (including, but not limited to, area development contracts owned by Franchiseesu) in the ordinary course of business or otherwise in an amount not exceeding $60,000,000, so long as (A) no Event of Default shall have occurred and be continuing and (B) the Borrower is in pro forma compliance with the Financial Covenant after giving effect to any such purchase;
(z) So long as no Event of Default market structure company shall have occurred and be continuing, Investments in Franchisees (including, but not limited to, (i) Guarantees or other credit support of any Indebtedness and other liabilities thereof and (ii) loans, advances or contributions to the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater of $20,000,000 and 70% of Consolidated EBITDA;
(aa) Investments consisting of accounts and payment intangibles owing to the Borrower or any of the Restricted Subsidiaries from Franchisees; provided that such obligation shall be on such terms as the Borrower or the applicable Restricted Subsidiary establishes in good faith; and
(bb) Investments consisting of advances or expenditures by any Loan Party to, or on behalf of, any CMF Subsidiary in support of advertising and marketing programs in the ordinary course consistent with current practices. For purposes of determining compliance with this Section 6.04, in the event that any item of Investment meets the criteria of more than one of the categories of Investments described in clauses (a) through (bb) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such Investment (or any portion thereof) and will only be required to include the amount and type of such Investment in one or more of the above clauses10,000,000.
Appears in 1 contract
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor the Borrower will, nor will they permit any Restricted Subsidiary to, purchase, hold, acquire (including pursuant to any merger or Intermediate Parent toconsolidation with any Person that was not a wholly-owned Subsidiary prior thereto), make or hold otherwise permit to exist any InvestmentInvestment in any other Person, except:
(a) Permitted Investments at the time such Permitted Investment is madeInvestments;
(b) loans or advances to officers, directors and employees of Holdings, any Intermediate Parent, the Borrower and the Restricted Subsidiaries (i) for reasonable Investments existing on the Closing Date in the Subsidiaries and customary business-related travel(ii) other Investments existing on the Closing Date and set forth on Schedule 6.04 to the Disclosure Letter;
(c) (x) additional Investments by Holdings in any Subsidiary Loan Party and by any Subsidiary Loan Party in another Subsidiary Loan Party, entertainmentand (y) Investments (including by way of capital contributions) by Holdings and its Subsidiaries in Equity Interests in their Subsidiaries; provided, relocation and analogous ordinary business purposesthat, in the case of clause (y), that (i) such subsidiaries are Subsidiaries prior to such Investments, (ii) in connection with any such Person’s purchase of Equity Interests held by a Loan Party shall be pledged in accordance with and to the extent required by the Collateral and Guarantee Requirement and (iii) the aggregate amount of such Investments by the Loan Parties in Subsidiaries that are not Loan Parties pursuant to this clause (y), plus the aggregate amount of loans and advances by the Loan Parties pursuant to Section 6.04(d) to Subsidiaries that are not Loan Parties, plus the aggregate amount of Guarantees by the Loan Parties pursuant to Section 6.04(e) of Indebtedness or other obligations of Subsidiaries that are not Loan Parties (excluding all such Investments, loans, advances and Guarantees existing on the Closing Date and permitted by clause (b) above or permitted under Section 6.04(p), (s) and (t) and (u) below) shall not exceed the greater of (A) $100,000,000160,000,000 and (B) 25% of Consolidated EBITDA for the four fiscal quarter period most recently ended for which Holdings has delivered financial statements pursuant to Section 5.01(a) or (b) at any time outstanding (in each case determined without regard to any write-downs or any direct or indirect parent thereofwrite-offs) (provided that and with the amount of any such Disposition “outstanding” for such purposes being deemed to be the fair market value of the applicable assets at the time of such Dispositions);
(d) loans or advances made by Holdings to any Subsidiary and made by any Subsidiary to any other Subsidiary; provided, that, (i) any Indebtedness resulting therefrom is permitted by clause (d) of Section 6.01 and (ii) the amount of such loans and advances made in cash to such Person shall be contributed to the Borrower in cash as common equity or Qualified Equity Interests) and (iii) for purposes not described in the foregoing clauses (i) and (ii); provided that at the time of incurrence thereof and after giving Pro Forma Effect thereto, the aggregate principal amount outstanding in reliance on this clause (iii) shall not exceed $1,000,000;
(c) Investments by Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary in any of Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary; provided that the aggregate outstanding amount of Investments made by Loan Parties in Restricted to Subsidiaries that are not Loan Parties shall be subject to the limitation set forth in reliance on this clause (c) shall not exceed the greater of $10,000,000 and 35% of Consolidated EBITDAabove;
(de) Investments consisting Guarantees by Holdings or any Subsidiary of prepayments Indebtedness or other obligations of Holdings or any other Subsidiary (including any such Guarantees arising as a result of any such Person being a joint and several co-applicant with respect to suppliers any letter of credit or letter of guaranty); provided, that, (i) (A) a Subsidiary that has not Guaranteed the Obligations pursuant to the Collateral Agreement shall not Guarantee any Indebtedness of any Loan Party, and (B) any such Guarantee of Subordinated Indebtedness is subordinated to the Loan Document Obligations on terms no less favorable to the Lenders than those of the Subordinated Indebtedness, (ii) any such Guarantee constituting Indebtedness is permitted by Section 6.01, and (iii) the aggregate amount of such Indebtedness (excluding, for the avoidance of doubt, Guarantees of obligations not constituting Indebtedness) of Subsidiaries that are not Loan Parties that is Guaranteed by any Loan Parties shall be subject to the limitation set forth in clause (c) above;
(f) (i) loans or advances to employees of Holdings or any Subsidiary made in the ordinary course of business;
, including those to finance the purchase of Equity Interests of Holdings pursuant to employee plans and (eii) Investments consisting payroll, travel, entertainment, relocation and similar advances to directors and employees of extensions Holdings or any Subsidiary to cover matters that are expected at the time of trade credit such advances to be treated as expenses of Holdings or such Subsidiary for accounting purposes and that are made in the ordinary course of business;
; provided, that, the aggregate principal amount of such loans and advances under this clause (f) Investments (i) existing or contemplated on the date hereof and set forth on Schedule 6.04(f) and outstanding at any modification, replacement, renewal, reinvestment or extension thereof and (ii) Investments existing on the date hereof by Holdings, the Borrower or any Restricted Subsidiary in the Borrower or any Restricted Subsidiary and any modification, renewal or extension thereof; provided that the amount of the original Investment is time shall not increased except by the terms of such Investment to the extent as set forth on Schedule 6.04(f) or as otherwise permitted by this Section 6.04exceed $15,000,00025,000,000;
(g) Investments in Swap Agreements permitted under Section 6.01(a)(vi);
(h) promissory notes and other non-cash consideration received in connection with Dispositions permitted by Section 6.05;
(i) Permitted Acquisitions;
(j) the Transactions;
(k) Investments in the ordinary course of business consisting of endorsements for collection or deposit and customary trade arrangements with customers consistent with past practices;
(l) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers and customersof, from financially troubled account debtors or in settlement of delinquent obligations of, or other accounts and disputes with, customers and suppliers suppliers, or upon the foreclosure with respect to any secured Investment or other transfer consisting of title with respect to any secured Investment;
(m) loans and advances to Holdings (or any direct or indirect parent thereof) or any Intermediate Parent in lieu of, and not in excess of the amount of (after giving effect to any other loans, advances or Restricted Payments in respect thereof), Restricted Payments to the extent permitted to be made to Holdings (or such parent) or such Intermediate Parent in accordance with Section 6.08(a);
(n) additional Investments and other acquisitions; provided that at the time any such Investment or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition made in reliance on this clause (n), together with the aggregate amount of all consideration paid securities acquired in connection with all other Investments and acquisitions made in reliance on this clause (n), shall not exceed the sum satisfaction or enforcement of (A) the greater of $18,000,000 and 60% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect claims due or owing to the making of such Investment or other acquisition, plus (B) so long as no Event of Default has occurred and is continuing, the Available Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of such Investment;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby;
(p) advances of payroll payments to employees in the ordinary course of business;
(q) Investments and other acquisitions to the extent that payment for such Investments is made with Qualified Equity Interests (excluding Cure Amounts) of Holdings (or any direct or indirect parent thereof or the IPO Entity); provided that (i) such amounts used pursuant to this clause (q) shall not increase the Available Amount and (ii) any amounts used for such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof or the IPO Entity) shall otherwise be permitted pursuant to this Section 6.04;
(r) Investments of a Subsidiary acquired after the Effective Date or of a Person merged or consolidated with any Subsidiary in accordance with this Section and Section 6.03 after the Effective Date to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger or consolidation and were in existence on the date of such acquisition, merger or consolidation;
(s) non-cash Investments in connection with tax planning and reorganization activities; provided that after giving effect to any such activities, the security interests of the Lenders in the Collateral, taken as a whole, would not be materially impaired;
(t) Investments consisting of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference to this Section 6.04(t)) under Sections 6.01, 6.02, 6.03, 6.05 and 6.08, respectively;
(u) additional Investments; provided that after giving effect to such Investment (A) on a Pro Forma Basis, the Total Net Leverage Ratio is less than or equal to 4.50 to 1.00 and (B) there is no continuing Event of Default;
(v) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the Borrower;
(w) to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Property, or other rightsSubsidiary, in each case in the ordinary course of business;
(x) Investments by an Unrestricted Subsidiary entered into prior to the day such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to the definition of “Unrestricted Subsidiary”;
(y) Investments consisting of purchases of assets of Franchisees (including, but not limited to, area development contracts owned by Franchisees) in the ordinary course of business or otherwise in an amount not exceeding $60,000,000, so long as (A) no Event of Default shall have occurred and be continuing and (B) the Borrower is in pro forma compliance with the Financial Covenant after giving effect to any such purchase;
(z) So long as no Event of Default shall have occurred and be continuing, Investments in Franchisees (including, but not limited to, (i) Guarantees or other credit support of any Indebtedness and other liabilities thereof and (ii) loans, advances or contributions to the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater of $20,000,000 and 70% of Consolidated EBITDA;
(aa) Investments consisting of accounts and payment intangibles owing to the Borrower or any of the Restricted Subsidiaries from Franchisees; provided that such obligation shall be on such terms as the Borrower or the applicable Restricted Subsidiary establishes in good faith; and
(bb) Investments consisting of advances or expenditures by any Loan Party to, or on behalf of, any CMF Subsidiary in support of advertising and marketing programs in the ordinary course consistent with current practices. For purposes of determining compliance with this Section 6.04, in the event that any item of Investment meets the criteria of more than one of the categories of Investments described in clauses (a) through (bb) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such Investment (or any portion thereof) and will only be required to include the amount and type of such Investment in one or more of the above clauses.
Appears in 1 contract
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor the Borrower will, nor will they permit any Restricted Subsidiary or Intermediate Parent to, make or hold any Investment, except:
(a) Permitted Investments at the time such Permitted Investment is made;
(b) loans or advances to officers, directors and employees of Holdings, any Intermediate Parent, the Borrower and the its Restricted Subsidiaries (i) for reasonable and customary business-related travel, entertainment, relocation and analogous ordinary business purposes, (ii) in connection with such Person’s purchase of Equity Interests in of Holdings (or any direct or indirect parent thereof) (provided that the amount of such loans and advances made in cash to such Person shall be contributed to the Borrower in cash as common equity or Qualified Equity Interests) and (iii) for purposes not described in the foregoing clauses (i) and (ii); provided that at the time of incurrence thereof and after giving Pro Forma Effect thereto, the in an aggregate principal amount outstanding in reliance on this clause (iii) shall at any time not to exceed $1,000,00035,000,000;
(c) Investments by Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary in any of Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary; provided that, in the case of any Investment by a Loan Party in a Restricted Subsidiary that the aggregate outstanding amount is not a Loan Party, no Event of Investments made by Loan Parties in Restricted Subsidiaries that are not Loan Parties in reliance on this clause (c) Default shall not exceed the greater of $10,000,000 have occurred and 35% of Consolidated EBITDAbe continuing or would result therefrom;
(d) Investments consisting of prepayments to suppliers in the ordinary course of business;
(e) Investments consisting of extensions of trade credit in the ordinary course of business;
(fe) Investments (i) existing or contemplated on the date hereof and set forth on Schedule 6.04(f6.04(e) and any modification, replacement, renewal, reinvestment or extension thereof and (ii) Investments existing on the date hereof by Holdings, the Borrower or any Restricted Subsidiary in the Borrower or any Restricted Subsidiary and any modification, renewal or extension thereof; provided that the amount of the original Investment is not increased except by the terms of such Investment to the extent as set forth on Schedule 6.04(f6.04(e) or as otherwise permitted by this Section 6.04;
(gf) Investments in Swap Agreements permitted under Section 6.01(a)(vi)6.01;
(hg) promissory notes and other non-cash consideration received in connection with Dispositions permitted by Section 6.05;
(ih) Permitted Acquisitions;
(ji) the Transactions[Reserved];
(kj) Investments in the ordinary course of business consisting of Uniform Commercial Code Article 3 endorsements for collection or deposit and Uniform Commercial Code Article 4 customary trade arrangements with customers consistent with past practices;
(lk) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers and customers, from financially troubled account debtors customers or in settlement of delinquent obligations of, or other disputes with, customers and suppliers or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment;
(ml) loans and advances to Holdings (or any direct or indirect parent thereof) or any Intermediate Parent in lieu of, and not in excess of the amount of (after giving effect to any other loans, advances or Restricted Payments in respect thereof), Restricted Payments to the extent permitted to be made to Holdings (or such parent) or such Intermediate Parent in accordance with Section 6.08(a);
(nm) additional Investments and other acquisitions; provided that at the time any such Investment or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition made in reliance on this clause (nm), together with the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (nm) (including the aggregate principal amount of all Indebtedness assumed in connection with any such other Investment or acquisition previously made under this clause (m)), shall not exceed the sum of (A) the greater of $18,000,000 190,000,000 and 6050.0% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Investment or other acquisition, plus (B) so long as immediately after giving effect to any such Investment no Event of Default has occurred and is continuingcontinuing (or, in the case of the use of the Starter Basket that is Not Otherwise Applied, no Event of Default under Section 7.01(a), (b), (h) or (i)), the Available Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of such Investment, plus (C) the Available Equity Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of such Investment;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby;
(pn) advances of payroll payments to employees in the ordinary course of business;
(qo) Investments and other acquisitions to the extent that payment for such Investments is made with Qualified Equity Interests (excluding Cure Amounts) of Holdings (or any direct or indirect parent thereof or the IPO Entity); provided that (i) such amounts used pursuant to this clause (qo) shall not increase the Available Equity Amount and (ii) any amounts used for such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof of or the IPO Entity) shall are otherwise be permitted pursuant to this Section 6.04;
(rp) Investments of a Subsidiary acquired after the Effective Date or of a Person merged or consolidated with any Subsidiary in accordance with this Section and Section 6.03 after the Effective Date to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger or consolidation and were in existence on the date of such acquisition, merger or consolidation;
(sq) non-cash Investments in connection with tax planning and reorganization activities; provided that after giving effect to any such activities, the security interests of the Lenders in the Collateral, taken as a whole, would not be materially impaired;; and
(tr) Investments consisting of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference to this Section 6.04(t6.04(r)) under Sections 6.01, 6.02, 6.03, 6.05 and 6.08, respectively;
(us) additional Investments; provided that after giving effect to such Investment (A) on a Pro Forma Basis, the Total Net First Lien Leverage Ratio is less than or equal to 4.50 to 1.00 and (B) there is no continuing Event of Default;
(vt) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the Borrower;
(wu) to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Property, or other rights, in each case in the ordinary course of business;
(xv) Investments by an Unrestricted Subsidiary entered into prior to the day such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to the definition of “Unrestricted Subsidiary.”;
(y) Investments consisting of purchases of assets of Franchisees (including, but not limited to, area development contracts owned by Franchisees) in the ordinary course of business or otherwise in an amount not exceeding $60,000,000, so long as (A) no Event of Default shall have occurred and be continuing and (B) the Borrower is in pro forma compliance with the Financial Covenant after giving effect to any such purchase;
(z) So long as no Event of Default shall have occurred and be continuing, Investments in Franchisees (including, but not limited to, (i) Guarantees or other credit support of any Indebtedness and other liabilities thereof and (ii) loans, advances or contributions to the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater of $20,000,000 and 70% of Consolidated EBITDA;
(aa) Investments consisting of accounts and payment intangibles owing to the Borrower or any of the Restricted Subsidiaries from Franchisees; provided that such obligation shall be on such terms as the Borrower or the applicable Restricted Subsidiary establishes in good faith; and
(bb) Investments consisting of advances or expenditures by any Loan Party to, or on behalf of, any CMF Subsidiary in support of advertising and marketing programs in the ordinary course consistent with current practices. For purposes of determining compliance with this Section 6.04, in the event that any item of Investment meets the criteria of more than one of the categories of Investments described in clauses (a) through (bb) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such Investment (or any portion thereof) and will only be required to include the amount and type of such Investment in one or more of the above clauses.
Appears in 1 contract
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor the The Borrower willwill not, nor and will they not permit any Restricted Subsidiary or Intermediate Parent to, make or hold any Investment, except:
(a) Permitted Investments at the time such Permitted Investment is madeInvestments;
(b) loans or advances to officers, directors and employees of Holdings, any Intermediate Parent, the Borrower and the its Restricted Subsidiaries (i) for reasonable and customary business-related travel, entertainment, relocation and analogous ordinary business purposespurposes of the Borrower and the Restricted Subsidiaries, (ii) in connection with such Person’s purchase of Equity Interests in Holdings (or any direct or indirect parent thereof) (provided that of the amount of such loans and advances made in cash to such Person shall be contributed to the Borrower in cash as common equity or Qualified Equity Interests) Borrower, and (iii) for purposes not described in the foregoing clauses (i) and (ii); provided that at the time of incurrence thereof and after giving Pro Forma Effect thereto, the aggregate principal amount outstanding in reliance on at any time under this clause (iiib)(iii) shall not to exceed $1,000,0003,500,000;
(c) Investments (i) by Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary in any of HoldingsLoan Party (excluding any new Restricted Subsidiary that becomes a Loan Party pursuant to such Investment), (ii) by any Intermediate ParentRestricted Subsidiary that is not a Loan Party in any other Restricted Subsidiary that is also not a Loan Party, (iii) by the Borrower or any Loan Party (A) in any Restricted Subsidiary; provided that the aggregate outstanding amount of such Investments made by Loan Parties after the Closing Date in Restricted Subsidiaries that are not Loan Parties in reliance on this clause (ciii)(A) shall not exceed the greater Non-Loan Party Investment Amount, (B) in any Restricted Subsidiary that is not a Loan Party, constituting an exchange of $10,000,000 Equity Interests of such Restricted Subsidiary for Indebtedness of such Restricted Subsidiary or (C) constituting Guarantees of Indebtedness or other monetary obligations of Restricted Subsidiaries that are not Loan Parties owing to any Loan Party, (iv) by the Borrower or any Restricted Subsidiary in Restricted Subsidiaries that are not Loan Parties so long as such Investment is part of a series of simultaneous Investments that result in the proceeds of the initial Investment being invested in one or more Loan Parties and 35% (v) by the Borrower or any Restricted Subsidiary in any Restricted Subsidiary that is not a Loan Party, consisting of Consolidated EBITDAthe contribution of Equity Interests of any other Restricted Subsidiary that is not a Loan Party so long as the Equity Interests of the transferee Restricted Subsidiary is pledged to secure the Secured Obligations;
(d) Investments consisting of prepayments to suppliers in the ordinary course of businessSeed Capital Investments;
(e) Investments consisting of extensions of trade credit in the ordinary course of business;
(f) Investments (i) existing or contemplated on the date hereof Closing Date and set forth on Schedule 6.04(f6.04(e) and any modification, replacement, renewal, reinvestment or extension thereof and (ii) Investments existing on the date hereof Closing Date by Holdings, the Borrower or any Restricted Subsidiary in the Borrower or any Restricted Subsidiary and any modification, renewal or extension thereof; provided that the amount of the original Investment is not increased except by the terms of such Investment to the extent as set forth on Schedule 6.04(f6.04(e) or as otherwise permitted by this Section 6.04;
(gf) Investments in Swap Agreements permitted under Section 6.01(a)(vi)incurred in the ordinary course of business and not for speculative purposes;
(hg) promissory notes and other non-cash consideration received in connection with Dispositions permitted by Section 6.05;
(ih) Permitted Acquisitions; provided that the aggregate amount of consideration paid or provided by the Borrower or any other Loan Party after the Closing Date in reliance on this Section 6.04(h) for Permitted Acquisitions (including the aggregate principal amount of all Indebtedness assumed in connection with Permitted Acquisitions) for any Restricted Subsidiary that shall not be or, after giving effect to such Permitted Acquisition, shall not become a Loan Party, shall not exceed the Non-Loan Party Investment Amount;
(i) the Borrower and its Restricted Subsidiaries may consummate the Acquisition;
(j) the Transactions;
(k) Investments in the ordinary course of business consisting of Uniform Commercial Code Article 3 endorsements for collection or deposit and Uniform Commercial Code Article 4 customary trade arrangements with customers consistent with past practices;
(lk) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers and customers, from financially troubled account debtors customers or in settlement of delinquent obligations of, or other disputes with, customers and suppliers or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment;
(l) Investments for (i) utilities, security deposits, leases and similar prepaid expenses incurred in the ordinary course of business and (ii) trade accounts created, or prepaid expenses accrued, in the ordinary course of business;
(m) loans and advances to Holdings other Investments; provided that (or any direct or indirect parent thereofi) or any Intermediate Parent in lieu of, and not in excess of the amount of (so long as immediately after giving effect to any other loans, advances or Restricted Payments in respect thereof), Restricted Payments to the extent permitted to be made to Holdings (or such parent) or such Intermediate Parent in accordance with Section 6.08(a);
(n) additional Investments and other acquisitions; provided that at the time any such Investment or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition made in reliance on this clause (n), together with the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (n), shall not exceed the sum of (A) the greater of $18,000,000 and 60% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Investment or other acquisition, plus (B) so long as no Event of Default has occurred and is continuing, and (ii) the aggregate outstanding amount of all Investments made in reliance on this clause (m) shall not exceed (A) the greater of (x) $7,500,000 and (y) 5.0% of LTM EBITDA plus (B) the Available Amount Amount;
(n) other Investments; provided that is Not Otherwise Applied as in effect immediately prior to (i) no Event of Default shall have occurred and be continuing or shall result therefrom and (ii) on a Pro Forma Basis, the time of making of such InvestmentTotal Net Leverage Ratio shall not exceed 2.00:1.00;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby;
(p) advances of payroll payments to employees in the ordinary course of business;
(q) Investments and other acquisitions to the extent that payment for such Investments is made with Qualified Equity Interests (excluding Cure Amounts) of Holdings (or any direct or indirect parent thereof or the IPO Entity); provided that (i) such amounts used pursuant to this clause (q) shall not increase the Available Amount and (ii) any amounts used for such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof or the IPO Entity) shall otherwise be permitted pursuant to this Section 6.04;
(rp) Investments of a Subsidiary acquired after the Effective Closing Date or of a Person merged or consolidated with any Subsidiary in accordance with this Section and Section 6.03 after the Effective Closing Date or that otherwise becomes a Subsidiary to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger or consolidation and were in existence on the date of such acquisition, merger or consolidation;
(sq) non-cash Investments in connection with tax planning and reorganization activities; provided that after giving effect to any such activities, the security interests of the Lenders in the Collateral, taken as a whole, would not be materially impaired;
(t) Investments consisting of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference to this Section 6.04(t)) under Sections 6.01, 6.02, 6.03, 6.05 and 6.08, respectively;
(u) additional Investments; provided that after giving effect to such Investment (A) on a Pro Forma Basis, the Total Net Leverage Ratio is less than or equal to 4.50 to 1.00 and (B) there is no continuing Event of Default;
(v) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the Borrower;
(w) receivables owing to the extent that they constitute InvestmentsBorrower or any Restricted Subsidiary, purchases and acquisitions of inventory, supplies, materials if created or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Property, or other rights, in each case acquired in the ordinary course of business;
(xr) Investments by an Unrestricted in any Restricted Subsidiary entered into prior that is a Broker-Dealer Subsidiary to the day extent necessary in order for such Unrestricted Restricted Subsidiary to be in compliance with its net capital requirements under any Requirements of Laws;
(s) the Amendment No. 1 Acquisition; and
(t) acquisitions of additional limited partnership units in the Amendment No. 1 Target so long as the Amendment No. 1 Target is redesignated as a Restricted Subsidiary pursuant to the definition of “Unrestricted Subsidiary”;
(y) Investments consisting of purchases of assets of Franchisees (including, but not limited to, area development contracts owned by Franchisees) in the ordinary course of business or otherwise in an amount not exceeding $60,000,000, so long as (A) and no Event of Default shall have occurred and be continuing and (B) at the Borrower is in pro forma compliance with the Financial Covenant after giving effect to time of any such purchase;
(z) So long as no Event of Default shall have occurred and be continuing, Investments in Franchisees (including, but not limited to, (i) Guarantees or other credit support of any Indebtedness and other liabilities thereof and (ii) loans, advances or contributions to the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater of $20,000,000 and 70% of Consolidated EBITDA;
(aa) Investments consisting of accounts and payment intangibles owing to the Borrower or any of the Restricted Subsidiaries from Franchisees; provided that such obligation shall be on such terms as the Borrower or the applicable Restricted Subsidiary establishes in good faith; and
(bb) Investments consisting of advances or expenditures by any Loan Party to, or on behalf of, any CMF Subsidiary in support of advertising and marketing programs in the ordinary course consistent with current practices. For purposes of determining compliance with this Section 6.04, in the event that any item of Investment meets the criteria of more than one of the categories of Investments described in clauses (a) through (bb) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such Investment (or any portion thereof) and will only be required to include the amount and type of such Investment in one or more of the above clausesacquisition.
Appears in 1 contract
Samples: Credit Agreement (Virtus Investment Partners, Inc.)
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor the The Borrower willwill not, nor and will they not permit any Restricted Subsidiary or Intermediate Parent to, make or hold any Investment, except:
(a) Permitted Investments at the time such Permitted Investment is made;
(b) loans or advances to officers, directors members of the Board of Directors, employees and employees consultants of Holdings, any Intermediate Parent, the Borrower and the its Restricted Subsidiaries (i) for reasonable and customary business-related travel, entertainment, relocation and analogous ordinary business purposes, (ii) in connection with such Person’s purchase of Equity Interests in Holdings (or any direct or indirect parent thereof) of the Borrower (provided that the amount of such loans and advances made in cash to such Person shall be contributed to the Borrower in cash as in exchange for common equity or other Qualified Equity Interests) and such amounts shall not increase the Available Amount and (iii) for purposes not described in the foregoing clauses (i) and (ii); provided that at the time of incurrence thereof and after giving Pro Forma Effect thereto, the in an aggregate principal amount outstanding in reliance on this clause (iii) shall at any time not to exceed $1,000,0002,500,000;
(c) Investments by Holdings, the Borrower in any Intermediate Parent, Restricted Subsidiary and Investments by any Restricted Subsidiary in the Borrower or any Restricted Subsidiary in any of Holdings, any Intermediate Parent, the Borrower or any other Restricted Subsidiary; provided that, in the case of any Investment by a Loan Party in a Restricted Subsidiary that is not a Loan Party, the aggregate outstanding amount of all such Investments made by Loan Parties after the Closing Date in Restricted Subsidiaries that are not Loan Parties in reliance on this clause (c), together with (x) the aggregate cash consideration paid for Permitted Acquisitions of Persons that do not become Subsidiary Loan Parties (or are not merged with and into the Borrower or a Subsidiary Loan Party) or of assets that are not owned by the Borrower or a Subsidiary Loan Party after giving Pro Forma Effect to each such applicable Permitted Acquisition and any transactions occurring in connection therewith in reliance on clause (h) below and (y) the aggregate outstanding amount of Investments made in reliance on clause (aa) below, shall not exceed at any time outstanding the greater of $10,000,000 23,000,000 and 3525% of Consolidated EBITDAEBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Investment;
(d) Investments consisting of prepayments to suppliers in the ordinary course of business;
(e) Investments consisting of extensions of trade credit in the ordinary course of business;
(fe) Investments (i) existing or contemplated on the date hereof Closing Date and set forth on Schedule 6.04(f6.04(e) and any modification, replacement, renewal, reinvestment or extension thereof and (ii) Investments existing on the date hereof Closing Date by Holdings, the Borrower or any Restricted Subsidiary in the Borrower or any Restricted Subsidiary and any modification, renewal or extension thereof; provided that the amount of the original Investment is not increased except by the terms of such Investment as, and to the extent as extent, set forth on Schedule 6.04(f6.04(e) or as otherwise permitted by another clause of this Section 6.04;
(gf) Investments in Swap Agreements permitted under Section 6.01(a)(vi)incurred in the ordinary course of business and not for speculative purposes, including any such obligation which is a forward equity commitment or confirmation or forward equity sale agreement to the extent the terms thereof provide that the obligation can be satisfied by the issuance of common Equity Interests;
(hg) promissory notes and other non-cash consideration received in connection with Dispositions permitted by Section 6.05;
(ih) Permitted AcquisitionsAcquisitions and xxxxxxx money deposits in connection therewith; provided that the aggregate cash consideration paid for Permitted Acquisitions of Persons that do not become Subsidiary Loan Parties (or are not merged with and into the Borrower or a Subsidiary Loan Party) or of assets that are not owned by the Borrower or a Subsidiary Loan Party, together with (x) the aggregate outstanding amount of all Investments made by Loan Parties after the Closing Date in Restricted Subsidiaries that are not Loan Parties in reliance on clause (c) above and (y) the aggregate outstanding amount of Investments made in reliance on clause (aa) below, shall not exceed at any time outstanding the greater of $23,000,000 and 25% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Permitted Acquisition and any transactions occurring in connection therewith;
(ji) the Transactions;
(kj) Investments in the ordinary course of business consisting of Uniform Commercial Code Article 3 endorsements for collection or deposit and Uniform Commercial Code Article 4 customary trade arrangements with customers consistent with past practicesin the ordinary course of business;
(lk) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers and customers, from financially troubled account debtors customers or in settlement of delinquent obligations of, or other disputes with, customers and suppliers or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment;
(ml) loans Investments consisting of receivables and advances to Holdings (or any direct or indirect parent thereof) or any Intermediate Parent notes received from students in lieu of, and not in excess the ordinary course of the amount of (after giving effect to any other loans, advances or Restricted Payments in respect thereof), Restricted Payments to the extent permitted to be made to Holdings (or such parent) or such Intermediate Parent in accordance with Section 6.08(a)business;
(nm) so long as no Default or Event of Default shall have occurred and be continuing or would result therefrom, additional Investments and other acquisitions; provided that at the time any such Investment or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition made in reliance on this clause (n), together with the an aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (n), shall at any time outstanding not to exceed the sum of (A) the greater of $18,000,000 23,000,000 and 6025% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Investment or other acquisition, plus (B) so long as no Event of Default has occurred and is continuing, the Available Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of such Investment;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby;
(pn) advances of payroll payments to employees in the ordinary course of business;
(qo) Investments and other acquisitions to the extent that payment for such Investments is made with Qualified Equity Interests (excluding Cure Amounts) of Holdings (or any direct or indirect parent thereof or the IPO Entity); provided that (i) such amounts used pursuant to this clause (q) shall not increase the Available Amount and (ii) any amounts used for such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof or the IPO Entity) shall otherwise be permitted pursuant to this Section 6.04Borrower;
(rp) Investments of a Restricted Subsidiary acquired after the Effective Closing Date or of a Person merged or consolidated with any Restricted Subsidiary in accordance with this Section 6.04 and Section 6.03 after the Effective Closing Date or that otherwise becomes a Restricted Subsidiary (provided that if such Investment is made under Section 6.04(h), existing Investments in subsidiaries of such Restricted Subsidiary or Person shall comply with the requirements of Section 6.04(h)) to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger or consolidation and were in existence on the date of such acquisition, merger or consolidation;
(q) receivables owing to the Borrower or any Restricted Subsidiary, if created or acquired in the ordinary course of business;
(r) Investments (A) for utilities, security deposits, leases and similar prepaid expenses incurred in the ordinary course of business and (B) trade accounts created, or prepaid expenses accrued, in the ordinary course of business;
(s) non-cash Investments in connection with bona fide tax planning and reorganization activities; provided that after giving effect to any such activitiesnon-cash Investments, the security interests of the Lenders in the Collateral, taken as a whole, and the Guarantees by the Loan Parties under the Guarantee Agreement, would not be materially impaired;
(t) additional Investments so long as at the time of any such Investment and immediately after giving effect thereto, (A) on a Pro Forma Basis, the Total Net Leverage Ratio is no greater than 1.50 to 1.00, (B) on a Pro Forma Basis, the Borrower is in compliance with the Financial Performance Covenant for the Test Period most recently ended and (C) no Event of Default exists or would result therefrom;
(u) Investments consisting of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference to this Section 6.04(t6.04(u)) under Sections 6.01, 6.02, 6.03, 6.05 and 6.086.07, respectively;
(u) additional Investments; provided that after giving effect to such Investment (A) on a Pro Forma Basis, the Total Net Leverage Ratio is less than or equal to 4.50 to 1.00 and (B) there is no continuing Event of Default;
(v) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the Borrower;
(w) to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Property, or other rights, in each case in the ordinary course of business;
(x) Investments by an Unrestricted Subsidiary entered into prior to the day such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to the definition of “Unrestricted Subsidiary”in any Term Loans in accordance with Section 9.04(f);
(y) Investments consisting of purchases of assets of Franchisees (including, but not limited to, area development contracts owned by Franchisees) in the ordinary course of business or otherwise in an amount not exceeding $60,000,000, so long as (A) no Event of Default shall have occurred and be continuing and (B) the Borrower is in pro forma compliance connection with the Financial Covenant after giving effect to any such purchaseSettlements;
(z) So [reserved]; and
(aa) so long as no Default or Event of Default shall have has occurred and be continuingis continuing or would otherwise result therefrom, Investments in Franchisees joint ventures, Unrestricted Subsidiaries and Similar Businesses; provided that the aggregate amount of such Investments together with (including, but x) the aggregate outstanding amount of all Investments made by Loan Parties after the Closing Date in Restricted Subsidiaries that are not limited to, Loan Parties in reliance on clause (ic) Guarantees or other credit support of any Indebtedness and other liabilities thereof above and (iiy) loans, advances the aggregate cash consideration paid for Permitted Acquisitions of Persons that do not become Subsidiary Loan Parties (or contributions are not merged with and into the Borrower or a Subsidiary Loan Party) or of assets that are not owned by the Borrower or a Subsidiary Loan Party after giving Pro Forma Effect to the marketing each such applicable Permitted Acquisition and advertising funds operating any transactions occurring in connection with the European Wax Center franchise systemstherewith in reliance on clause (h) above, shall not to exceed at any time outstanding the greater of $20,000,000 23,000,000 and 7025% of Consolidated EBITDA;
(aa) Investments consisting of accounts and payment intangibles owing EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the Borrower or any of the Restricted Subsidiaries from Franchisees; provided that such obligation shall be on such terms as the Borrower or the applicable Restricted Subsidiary establishes in good faith; and
(bb) Investments consisting of advances or expenditures by any Loan Party to, or on behalf of, any CMF Subsidiary in support of advertising and marketing programs in the ordinary course consistent with current practices. For purposes of determining compliance with this Section 6.04, in the event that any item of Investment meets the criteria of more than one of the categories of Investments described in clauses (a) through (bb) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such Investment (or any portion thereof) and will only be required to include the amount and type making of such Investment in one or more of the above clausesInvestment.
Appears in 1 contract
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor the The Borrower willwill not, nor will they it permit any Restricted Subsidiary or Intermediate Parent to, of its Subsidiaries make or hold any Investment, except:
(a) Permitted Investments at and other liquid investments reasonably acceptable to the time such Permitted Investment is madeAdministrative Agent and approved as part of the investment policy adopted by the audit committee of the Borrower’s board of directors;
(b) loans or advances to officers, directors and employees of Holdings, any Intermediate Parent, the Borrower and the Restricted its Subsidiaries (i) for reasonable and customary business-related travel, entertainment, relocation and analogous ordinary business purposes, (ii) to purchase stock in connection with such Person’s purchase of Equity Interests in Holdings (or any direct or indirect parent thereof) (provided that the amount of such loans and advances made in cash to such Person shall be contributed to the Borrower in cash as common equity or Qualified Equity Interests) and (iii) for purposes not described in the foregoing clauses clause (i) and or (ii); provided that at the time of incurrence thereof and after giving Pro Forma Effect thereto, the in an aggregate principal amount outstanding in reliance on this clause (iii) shall at any time not to exceed $1,000,0002,500,000;
(c) Investments (i) by Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary of its Subsidiaries in any of HoldingsLoan Party (excluding any new Subsidiary that becomes a Loan Party pursuant to such Investment), (ii) by any Intermediate ParentSubsidiary that is not a Loan Party in any other Subsidiary that is also not a Loan Party, (iii) by the Borrower or any Restricted of its Subsidiaries (A) in any Subsidiary; provided that the aggregate outstanding *Confidential Treatment Requested. Omitted portions filed with the Commission. amount of such Investments made by Loan Parties after the Effective Date in Restricted Subsidiaries that are not Loan Parties in reliance on this clause (ciii)(A) (together with the amount of Investments made in Subsidiaries that are not Loan Parties pursuant to Sections 6.04(h) and 6.04(n)) shall not exceed the greater Non-Loan Party Investment Amount at the time of $10,000,000 any such Investment, (B) in any Subsidiary that is not a Loan Party, constituting an exchange of Equity Interests of such Subsidiary for Indebtedness of such Subsidiary or (C) constituting Guarantees of Indebtedness or other monetary obligations of Subsidiaries that are not Loan Parties owing to any Loan Party, (iv) by the Borrower or any of its Subsidiaries in Subsidiaries that are not Loan Parties so long as such Investment is part of a series of simultaneous Investments that result in the proceeds of the initial Investment being invested in one or more Loan Parties and 35% (v) by the Borrower or any of Consolidated EBITDAits Subsidiaries in any Subsidiary that is not a Loan Party, consisting of the contribution of Equity Interests of any other Subsidiary that is not a Loan Party so long as the Equity Interests of the transferee Subsidiary is pledged to secure the Secured Obligations;
(d) Investments consisting of prepayments to suppliers in the ordinary course of business;
(e) Investments consisting of extensions of trade credit in the ordinary course of business;
(fe) Investments (i) existing or contemplated on the date hereof and set forth on Schedule 6.04(f6.04(e) and any modification, replacement, renewal, reinvestment or extension thereof and (ii) Investments existing on the date hereof by Holdings, the Borrower or any Restricted Subsidiary in the Borrower or any Restricted Subsidiary and any modification, renewal or extension thereof; provided that the amount of the original Investment is not increased except by the terms of such Investment to the extent as set forth on Schedule 6.04(f6.04(e) or as otherwise permitted by this Section 6.04;
(gf) Investments in Swap Agreements permitted under Section 6.01(a)(vi6.01(vi);
(hg) promissory notes and other non-cash consideration received in connection with Dispositions permitted by Section 6.05;
(ih) Permitted Acquisitions; provided that the aggregate amount of cash and non-cash consideration paid or provided by the Borrower or any other Loan Party after the Effective Date in reliance on this Section 6.04(h) (together with any Investments made in Subsidiaries that are not Loan Parties pursuant to Sections 6.04(c)(iii)(A) and 6.04(n)) for Permitted Acquisitions (including the aggregate principal amount of all Indebtedness assumed in connection with Permitted Acquisitions) for any Subsidiary that shall not be or, after giving effect to such Permitted Acquisition, shall not become a Loan Party, shall not exceed the Non-Loan Party Investment Amount at such time;
(i) extensions of credit and guarantees permitted by Section 6.01 and Restricted Payments permitted by Section 6.06;
(j) the Transactions;
(k) Investments in the ordinary course of business consisting of Uniform Commercial Code Article 3 endorsements for collection or deposit and Uniform Commercial Code Article 4 customary trade arrangements with customers consistent with past practices;
(lk) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers and customers, from financially troubled account debtors customers or in settlement of delinquent obligations of, or other disputes with, customers and suppliers or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment;
(m) loans and advances to Holdings (or any direct or indirect parent thereof) or any Intermediate Parent in lieu of, and not in excess of the amount of (after giving effect to any other loans, advances or Restricted Payments in respect thereof), Restricted Payments to the extent permitted to be made to Holdings (or such parent) or such Intermediate Parent in accordance with Section 6.08(a);
(n) additional Investments and other acquisitions; provided that at the time any such Investment or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition made in reliance on this clause (n), together with the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (n), shall not exceed the sum of (A) the greater of $18,000,000 and 60% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Investment or other acquisition, plus (B) so long as no Event of Default has occurred and is continuing, the Available Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of such Investment;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby;
(pl) advances of payroll payments to employees in the ordinary course of business;; *Confidential Treatment Requested. Omitted portions filed with the Commission.
(q) Investments and other acquisitions to the extent that payment for such Investments is made with Qualified Equity Interests (excluding Cure Amounts) of Holdings (or any direct or indirect parent thereof or the IPO Entity); provided that (i) such amounts used pursuant to this clause (q) shall not increase the Available Amount and (ii) any amounts used for such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof or the IPO Entity) shall otherwise be permitted pursuant to this Section 6.04;
(rm) Investments of a Subsidiary acquired after the Effective Date or of a Person merged merged, amalgamated or consolidated with any Subsidiary in accordance with this Section and Section 6.03 after the Effective Date (other than existing Investments in Subsidiaries of such Subsidiary or Person, which must comply with the requirements of Section 6.04(h) or 6.04(m)) to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger merger, amalgamation or consolidation and were in existence on the date of such acquisition, merger merger, amalgamation or consolidation;
(n) acquisitions of, investments in, and loans and advances to, joint ventures and other Persons by the Borrower and its Subsidiaries, so long as the aggregate amount invested, loaned or advanced pursuant to this Section 6.04(n) (determined without regard to any write-downs or write-offs of such investments, loans or advances), together with any Investments made in Subsidiaries that are not Loan Parties pursuant to Sections 6.04(c)(iii)(A) and 6.04(h), does not exceed the Non-Loan Party Investment Amount at such time;
(o) the licensing, sublicensing or contribution of rights in any Intellectual Property pursuant to joint marketing, distribution, or development arrangements with Persons other than the Borrower and its Subsidiaries in the ordinary course of business;
(p) Investments to the extent that payment for such Investments is made solely by the issuance of Equity Interests (other than Disqualified Equity Interests) of the Borrower (or any direct or indirect parent of the Borrower) to the seller of such Investments;
(q) any Investments in a Subsidiary that is not a Loan Party or in a joint venture, in each case, to the extent such Investment is contemporaneously repaid in full with a dividend or other distribution from such Subsidiary or joint venture;
(r) the forgiveness or conversion to Equity Interests of any Indebtedness owed by a Loan Party and permitted by Section 6.02;
(s) non-cash Investments in connection Subsidiaries of Borrower may be established or created if the Borrower and such Subsidiary comply with tax planning and reorganization activitiesthe requirements of Section 5.11, if applicable; provided that after giving effect that, in each case, to the extent such new Subsidiary is created solely for the purpose of consummating an acquisition permitted by this Section 6.04, and such new Subsidiary at no time holds any assets or liabilities other than any merger consideration contributed to it contemporaneously with the closing of such activitiestransactions, such new Subsidiary shall not be required to take the security interests actions set forth in Section 5.11, as applicable, until the respective acquisition is consummated (at which time the surviving entity of the Lenders respective transaction shall be required to so comply in accordance with the Collateral, taken as a whole, would not be materially impairedprovisions thereof);
(t) Investments consisting of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference to this Section 6.04(t)) under Sections 6.01, 6.02, 6.03, 6.05 and 6.08, respectively;
(u) additional Investments; provided that after giving effect to such Investment (A) on a Pro Forma Basis, the Total Net Leverage Ratio is less than or equal to 4.50 to 1.00 and (B) there is no continuing Event of Default;
(v) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the Borrower;
(w) to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials or and equipment or purchases, acquisitions, purchases of contract rights or licenses or leases of other assets, Intellectual Property, or other rightsintellectual property, in each case in the ordinary course of business;
(xu) other Investments by an Unrestricted Subsidiary entered into prior to the day such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to the definition of “Unrestricted Subsidiary”;
(y) Investments consisting of purchases of assets of Franchisees (including, but not limited to, area development contracts owned by Franchisees) in the ordinary course of business or otherwise in an amount not exceeding $60,000,000, so long as (A) no Event of Default shall have occurred and be continuing and (B) the Borrower is in pro forma compliance with the Financial Covenant after giving effect to any such purchase;
(z) So long as no Event of Default shall have occurred and be continuing, Investments in Franchisees (including, but not limited to, (i) Guarantees or other credit support of any Indebtedness and other liabilities thereof and (ii) loans, advances or contributions to the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater of $20,000,000 and 70% of Consolidated EBITDA;
(aa) Investments consisting of accounts and payment intangibles owing to the Borrower or any of the Restricted its Subsidiaries from Franchisees; provided that such obligation shall be on such terms as the Borrower or the applicable Restricted Subsidiary establishes in good faith; and
(bb) Investments consisting of advances or expenditures by any Loan Party to, or on behalf of, any CMF Subsidiary in support of advertising and marketing programs in the ordinary course consistent with current practices. For purposes of determining compliance with this Section 6.04not to exceed, in the event that aggregate, at any item time outstanding, $5,000,000;
(v) Investment of Investment meets the criteria of more than one of the categories of Investments described cash in clauses (a) through (bb) aboveForeign Subsidiaries, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such Investment (or any portion thereof) and will only be required limited to include the amount required for the purchases by such Foreign Subsidiaries of Intellectual Property as contemplated by Section 6.05(q); *Confidential Treatment Requested. Omitted portions filed with the Commission.
(w) Guarantees of leases and type of other obligations that do not constitute Indebtedness;
(x) to the extent permitted by Section 6.13, Investments in Identified Projects in amounts not to exceed the amounts set forth in Schedule 6.04(x) opposite such Investment in one or more of the above clausesIdentified Project.
Appears in 1 contract
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor the Borrower will, nor will they permit any Restricted Subsidiary or Intermediate Parent to, make or hold any Investment, except:
(a) Permitted Investments at the time such Permitted Investment is madeInvestments;
(b) loans or advances to officers, directors and employees of Holdings, any Intermediate Parent, the Borrower and the its Restricted Subsidiaries (i) for reasonable and customary business-related travel, entertainment, relocation and analogous ordinary business purposes, (ii) in connection with such Person’s purchase of Equity Interests in of Holdings (or any direct or indirect parent thereof) (provided that the amount of such loans and advances made in cash to such Person shall be contributed to the Borrower in cash as common equity or Qualified Equity InterestsInterests and not as an Excluded Contribution) and (iii) for purposes not described in the foregoing clauses (i) and (ii); provided that at the time of incurrence thereof and after giving Pro Forma Effect thereto, the in an aggregate principal amount outstanding in reliance on this clause (iii) shall at any time not to exceed $1,000,0005,000,000;
(c) Investments (i) by Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary in any of HoldingsLoan Party (excluding any new Restricted Subsidiary that becomes a Loan Party pursuant to such Investment), (ii) by any Intermediate ParentRestricted Subsidiary that is not a Loan Party in any other Restricted Subsidiary that is also not a Loan Party, (iii) by the Borrower or any Restricted Subsidiary (A) in any Restricted Subsidiary; provided that the aggregate outstanding amount of such Investments made by Loan Parties after the Effective Date in Restricted Subsidiaries that are not Loan Parties in reliance on this clause (ciii)(A) (including any such Investments deemed to be made pursuant to Section 6.13(b)) (together with the amount of Investments made in Restricted Subsidiaries that are not Loan Parties pursuant to Section 6.04(h)) shall not exceed the greater Non-Loan Party Investment Amount at the time of $10,000,000 any such Investment, (B) in any Restricted Subsidiary that is not a Loan Party, constituting an exchange of Equity Interests of such Restricted Subsidiary for Indebtedness of such Subsidiary or (C) constituting Guarantees of Indebtedness or other monetary obligations of Restricted Subsidiaries that are not Loan Parties owing to any Loan Party, (iv) by Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary in Restricted Subsidiaries that are not Loan Parties so long as such Investment is part of a series of simultaneous Investments that result in the proceeds of the initial Investment being invested in one or more Loan Parties and 35% (v) by Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary in any Restricted Subsidiary that is not a Loan Party, consisting of Consolidated EBITDAthe contribution of Equity Interests of any other Restricted Subsidiary that is not a Loan Party so long as the Equity Interests of the transferee Restricted Subsidiary is pledged to secure the Secured Obligations to the extent such contribution is made by a Loan Party;
(d) Investments consisting of prepayments to suppliers in the ordinary course of business;
(e) Investments consisting of extensions of trade credit in the ordinary course of business;
(fe) Investments (i) existing or contemplated on the date hereof and set forth on Schedule 6.04(f6.04(e) and any modification, replacement, renewal, reinvestment or extension thereof and (ii) Investments existing on the date hereof by Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary in any Intermediate Parent, the Borrower or any Restricted Subsidiary and any modification, renewal or extension thereof; provided that the amount of the original Investment is not increased except by the terms of such Investment to the extent as set forth on Schedule 6.04(f6.04(e) or as otherwise permitted by this Section 6.04;
(gf) Investments in Swap Agreements permitted under Section 6.01(a)(vi)Agreements;
(hg) promissory notes and other non-cash consideration received in connection with Dispositions permitted by Section 6.05;
(ih) Permitted Acquisitions; provided that the aggregate amount of consideration paid or provided by Holdings, any Intermediate Parent, the Borrower or any other Loan Party after the Effective Date in reliance on this Section 6.04(h) for Permitted Acquisitions (including the aggregate principal amount of all Indebtedness assumed in connection with Permitted Acquisitions constituting an asset acquisition) for any Restricted Subsidiary that shall not be or, after giving effect to such Permitted Acquisition, shall not become a Loan Party (together with the amount of Investments made in Restricted Subsidiaries that are not Loan Parties pursuant to Section 6.04(c)), shall not exceed the Non-Loan Party Investment Amount at such time;
(ji) the Transactions;
(kj) Investments in the ordinary course of business consisting of Uniform Commercial Code Article 3 endorsements for collection or deposit and Uniform Commercial Code Article 4 customary trade arrangements with customers consistent with past practices;
(lk) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers and customers, from financially troubled account debtors customers or in settlement of delinquent obligations of, or other disputes with, customers and suppliers or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment;
(ml) loans and advances to Holdings (or any direct or indirect parent thereof) or any Intermediate Parent in lieu of, and not in excess of the amount of (after giving effect to any other loans, advances or Restricted Payments in respect thereof), Restricted Payments to the extent permitted to be made to Holdings (or such parent) or such any Intermediate Parent in accordance with Section 6.08(a6.08(a)(iv), (v), (vi), (vii), (viii) or (xi);
(n) additional Investments and other acquisitions; provided that at the time any such Investment or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition made in reliance on this clause (n), together with the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (n), shall not exceed the sum of (A) the greater of $18,000,000 and 60% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Investment or other acquisition, plus (Bm) so long as no Event of Default has occurred and is continuing, other Investments and acquisitions, in an amount not to exceed the Available Amount that to the extent such amount when made is Not Otherwise Applied as in effect immediately prior to the time of making of such InvestmentApplied;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby;
(pn) advances of payroll payments to employees in the ordinary course of business;
(qo) Investments and other acquisitions to the extent that payment for such Investments is made solely with Qualified Equity Interests (excluding Excluded Contributions and Cure Amounts) of Holdings (or any direct or indirect parent thereof or the IPO Entity); provided that (i) such amounts used pursuant to this clause (q) shall not increase the Available Amount and (ii) any amounts used for such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof or the IPO Entity) shall otherwise be permitted pursuant to this Section 6.04;
(rp) Investments of a the Borrower or any Restricted Subsidiary acquired after the Effective Date or of a Person merged or consolidated with any Restricted Subsidiary in accordance with this Section 6.04 and Section 6.03 after the Effective Date to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger or consolidation and were in existence on the date of such acquisition, merger or consolidation;
(sq) non-cash Investments in connection with tax planning and reorganization activities; provided that after giving effect to any such activities, the security interests of the Lenders in the Collateral, taken as a whole, would not be materially impaired;
(tr) Investments in an amount not to exceed Excluded Contributions made within the six months preceding any such Investment to the extent such amount is Not Otherwise Applied;
(s) Investments consisting of Indebtednessof, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference or to this Section 6.04(t)) under Sections 6.01, 6.02, 6.03, 6.05 and 6.08, respectively;
(u) additional Investments; provided that after giving effect to such Investment (A) on a Pro Forma Basis, the Total Net Leverage Ratio is less than or equal to 4.50 to 1.00 and (B) there is no continuing Event of Default;
(v) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the Borrower;
(w) to the extent that they constitute Investmentsfinance, purchases and acquisitions of inventory, supplies, materials material, services or equipment or purchases, acquisitions, purchases of contract rights or licenses or leases of other assets, Intellectual Property, or other rights, in each case in the ordinary course of business;
(x) Investments by an Unrestricted Subsidiary entered into prior to the day such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to the definition of “Unrestricted Subsidiary”;
(y) Investments consisting of purchases of assets of Franchisees (including, but not limited to, area development contracts owned by Franchisees) intellectual property in the ordinary course of business or otherwise in an amount pursuant to joint marketing arrangements with other Persons; and
(t) other Investments at the time of such Investment when made not exceeding $60,000,000, so long as (A) no Event of Default shall have occurred and be continuing and (B) in the Borrower is in pro forma compliance with the Financial Covenant after giving effect to any such purchase;
(z) So long as no Event of Default shall have occurred and be continuing, Investments in Franchisees (including, but not limited to, (i) Guarantees or other credit support of any Indebtedness and other liabilities thereof and (ii) loans, advances or contributions to the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed aggregate the greater of $20,000,000 25,000,000 and 7012.5% of Consolidated EBITDA;
(aa) Investments consisting of accounts and payment intangibles owing to EBITDA for the Borrower or any of the Restricted Subsidiaries from Franchisees; provided that such obligation shall be on such terms as the Borrower or the applicable Restricted Subsidiary establishes in good faith; and
(bb) Investments consisting of advances or expenditures by any Loan Party to, or on behalf of, any CMF Subsidiary in support of advertising and marketing programs in the ordinary course consistent with current practices. For purposes of determining compliance with this Section 6.04, in the event that any item of Investment meets the criteria of more than one of the categories of Investments described in clauses (a) through (bb) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such Investment (or any portion thereof) and will only be required to include the amount and type of such Investment in one or more of the above clausesmost recently ended Test Period.
Appears in 1 contract
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor the Borrower will, nor will they permit any Restricted Subsidiary to, purchase, hold, acquire (including pursuant to any merger or Intermediate Parent toconsolidation with any Person that was not a wholly-owned Subsidiary prior thereto), make or hold otherwise permit to exist any InvestmentInvestment in any other Person, except:
(a) Permitted Investments at the time such Permitted Investment is madeInvestments;
(b) loans or advances to officers, directors and employees of Holdings, any Intermediate Parent, the Borrower and the Restricted Subsidiaries (i) for reasonable Investments existing on the Closing Date in the Subsidiaries and customary business-related travel(ii) other Investments existing on the Closing Date and set forth on Schedule 6.04 to the Disclosure Letter;
(c) (x) additional Investments by Holdings in any Subsidiary Loan Party and by any Subsidiary Loan Party in another Subsidiary Loan Party, entertainmentand (y) Investments (including by way of capital contributions) by Holdings and its Subsidiaries in Equity Interests in their Subsidiaries; provided, relocation and analogous ordinary business purposesthat, in the case of clause (y), that (i) such subsidiaries are Subsidiaries prior to such Investments, (ii) in connection with any such Person’s purchase of Equity Interests held by a Loan Party shall be pledged in Holdings accordance with and to the extent required by the Collateral and Guarantee Requirement and (iii) the aggregate amount of such Investments by the Loan Parties in Subsidiaries that are not Loan Parties pursuant to this clause (y), plus the aggregate amount of loans and advances by the Loan Parties pursuant to Section 6.04(d) to Subsidiaries that are not Loan Parties, plus the aggregate amount of Guarantees by the Loan Parties pursuant to Section 6.04(e) of Indebtedness or other obligations of Subsidiaries that are not Loan Parties (excluding all such Investments, loans, advances and Guarantees existing on the Closing Date and permitted by clause (b) above or permitted under Section 6.04(p), (s) and (t) and (u) below) shall not exceed, together with any direct Dispositions by Loan Parties to Subsidiaries that are not Loan Parties made pursuant to Section 6.05(b), $80,000,000 at any time outstanding (in each case determined without regard to any write-downs or indirect parent thereofwrite-offs) (provided that and with the amount of any such Disposition “outstanding” for such purposes being deemed to be the fair market value of the applicable assets at the time of such Dispositions);
(d) loans or advances made by Holdings to any Subsidiary and made by any Subsidiary to any other Subsidiary; provided, that, (i) any Indebtedness resulting therefrom is permitted by clause (d) of Section 6.01 and (ii) the amount of such loans and advances made in cash to such Person shall be contributed to the Borrower in cash as common equity or Qualified Equity Interests) and (iii) for purposes not described in the foregoing clauses (i) and (ii); provided that at the time of incurrence thereof and after giving Pro Forma Effect thereto, the aggregate principal amount outstanding in reliance on this clause (iii) shall not exceed $1,000,000;
(c) Investments by Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary in any of Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary; provided that the aggregate outstanding amount of Investments made by Loan Parties in Restricted to Subsidiaries that are not Loan Parties shall be subject to the limitation set forth in reliance on this clause (c) above;
(e) Guarantees by Holdings of the Obligations, and the obligations under Alternative Incremental Facility Indebtedness, Permitted First Priority Refinancing Indebtedness, Permitted Junior Priority Refinancing Indebtedness, Permitted Second Lien Indebtedness and Permitted Unsecured Indebtedness, and, in each case, Refinancing Indebtedness in respect thereof, and Indebtedness permitted under Section 6.01(t), and Guarantees by Holdings or any Subsidiary of Indebtedness or other obligations of Holdings or any other Subsidiary (including any such Guarantees arising as a result of any such Person being a joint and several co-applicant with respect to any letter of credit or letter of guaranty); provided, that, (i) (A) a Subsidiary that has not Guaranteed the Obligations pursuant to the Collateral Agreement shall not Guarantee any Indebtedness of any Loan Party, and (B) any such Guarantee of Subordinated Indebtedness is subordinated to the Loan Document Obligations on terms no less favorable to the Lenders than those of the Subordinated Indebtedness, (ii) any such Guarantee constituting Indebtedness is permitted by Section 6.01, and (iii) the aggregate amount of such Indebtedness (excluding, for the avoidance of doubt, Guarantees of obligations not constituting Indebtedness) of Subsidiaries that are not Loan Parties that is Guaranteed by any Loan Parties shall be subject to the limitation set forth in clause (c) above;
(i) loans or advances to employees of Holdings or any Subsidiary made in the ordinary course of business, including those to finance the purchase of Equity Interests of Holdings pursuant to employee plans and (ii) payroll, travel, entertainment, relocation and similar advances to directors and employees of Holdings or any Subsidiary to cover matters that are expected at the time of such advances to be treated as expenses of Holdings or such Subsidiary for accounting purposes and that are made in the ordinary course of business; provided, that, the aggregate principal amount of such loans and advances under this clause (f) outstanding at any time shall not exceed the greater of $10,000,000 and 35% of Consolidated EBITDA15,000,000;
(dg) Investments received in connection with the bankruptcy or reorganization of, or settlement of delinquent accounts and disputes with, customers and suppliers, or consisting of prepayments securities acquired in connection with the satisfaction or enforcement of claims due or owing to suppliers Holdings or any Subsidiary, in each case in the ordinary course of business;
(e) Investments consisting of extensions of trade credit in the ordinary course of business;
(f) Investments (i) existing or contemplated on the date hereof and set forth on Schedule 6.04(f) and any modification, replacement, renewal, reinvestment or extension thereof and (ii) Investments existing on the date hereof by Holdings, the Borrower or any Restricted Subsidiary in the Borrower or any Restricted Subsidiary and any modification, renewal or extension thereof; provided that the amount of the original Investment is not increased except by the terms of such Investment to the extent as set forth on Schedule 6.04(f) or as otherwise permitted by this Section 6.04;
(g) Investments in Swap Agreements permitted under Section 6.01(a)(vi);
(h) promissory notes and other non-cash consideration received in connection with Dispositions permitted by Section 6.05;
(i) Permitted Acquisitions;
(j) the Transactions;
(ki) Investments in the ordinary course of business consisting of endorsements for collection or deposit and customary trade arrangements with customers consistent with past practices;
(l) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers and customers, from financially troubled account debtors or in settlement of delinquent obligations of, or other disputes with, customers and suppliers or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment;
(m) loans and advances to Holdings (or any direct or indirect parent thereof) or any Intermediate Parent in lieu of, and not in excess of the amount of (after giving effect to any other loans, advances or Restricted Payments in respect thereof), Restricted Payments to the extent permitted to be made to Holdings (or such parent) or such Intermediate Parent in accordance with Section 6.08(a);
(n) additional Investments and other acquisitions; provided that at the time any such Investment or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition made in reliance on this clause (n), together with the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (n), shall not exceed the sum of (A) the greater of $18,000,000 and 60% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Investment or other acquisition, plus (B) so long as no Event of Default has occurred and is continuing, the Available Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of such Investment;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby;
(p) advances of payroll payments to employees in the ordinary course of business;
(q) Investments and other acquisitions to the extent that payment for such Investments is made with Qualified Equity Interests (excluding Cure Amounts) of Holdings (or any direct or indirect parent thereof or the IPO Entity); provided that (i) such amounts used pursuant to this clause (q) shall not increase the Available Amount and (ii) any amounts used for such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof or the IPO Entity) shall otherwise be permitted pursuant to this Section 6.04;
(r) Investments of held by a Subsidiary acquired after the Effective Closing Date or of a Person merged or consolidated with any or into a Subsidiary in accordance with this Section and Section 6.03 after the Effective Date Closing Date, in each case as permitted hereunder, to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger or consolidation and were in existence on the date of such acquisition, merger or consolidation; provided, that, this clause (i) is intended solely to grandfather such Investments as are indirectly acquired as a result of an acquisition of such Person otherwise permitted hereunder and any consideration paid in connection with such acquisition that may be allocable to such Investments must be permitted by, and be taken into account in computing compliance with, any basket amounts or limitations applicable to such acquisition hereunder;
(j) Investments in the form of Hedging Agreements permitted by Section 6.06;
(k) Investments by Foreign Subsidiaries in other Foreign Subsidiaries;
(l) Investments made as a result of the receipt of noncash consideration from a sale, transfer, lease or other disposition of any asset in compliance with Section 6.05;
(m) Investments that result solely from the receipt by Holdings or any Subsidiary from any of its subsidiaries of a dividend or other Restricted Payment in the form of Equity Interests, evidences of Indebtedness or other securities (but not any additions thereto made after the date of the receipt thereof);
(n) Investments consisting of (i) extensions of trade credit, (ii) deposits made in connection with the purchase of goods or services or the performance of leases, licenses or contracts, in each case, in the ordinary course of business, (iii) notes receivable of, or prepaid royalties and other extensions of credit to, customers and suppliers that are not Affiliates of Holdings and that are made in the ordinary course of business consistent with past practice and (iv) Guarantees made in the ordinary course of business in support of obligations of Holdings or any of its Subsidiaries not constituting Indebtedness for borrowed money, including operating leases and obligations owing to suppliers, customers and licensees;
(o) (i) mergers and consolidations permitted under Section 6.03 that do not involve any Person other than Holdings and Subsidiaries that are wholly-owned Subsidiaries and (ii) Investments in any Subsidiary in connection with any Permitted Reorganization;
(p) intercompany loans or other intercompany Investments made by Loan Parties in the ordinary course of business to or in any Foreign Subsidiary (i) to fund the payment of business expenses and income taxes of any TriNet Captive Insurance Subsidiary that is organized outside of the United States, (ii) to capitalize any TriNet Captive Insurance Subsidiary and (iii) to provide funds as necessary to enable the applicable Foreign Subsidiary to comply with changes in statutory or contractual capital requirements;
(q) joint ventures or strategic alliances created or formed in the ordinary course of business of Holdings or its Subsidiaries; provided, that, the aggregate amount of Investments in such entities during any fiscal year do not exceed $20,000,000 in the aggregate;
(r) Investments consisting of Guarantees in the ordinary course of business to support the obligations of any Subsidiary under its worker’s compensation and general insurance agreements;
(s) non-cash Investments (including Investments in connection the acquisition of Foreign Subsidiaries or other Persons (including Non-Compliant Subsidiaries and Non-Compliant Assets in connection with tax planning Permitted Acquisitions) that will not be Loan Parties) made with the Available Amount, so long as, subject to Section 1.05, (i) no Event of Default shall have occurred and reorganization activities; provided be continuing immediately before and after giving effect thereto and (ii) solely in the case of any Investment made in reliance on clause (a)(ii) of the definition of “Available Amount”, (A) the Total Leverage Ratio immediately after giving effect to such Investment, calculated on a Pro Forma Basis at the time such Investment is made, is not in excess of 3.25 to 1.00, and (B) Holdings would be in compliance with Section 6.11(b) (calculated on a Pro Forma Basis at the time such Investment is made) as of the most recent fiscal quarter end for which Holdings was required to deliver financial statements pursuant to Section 5.01(a) or (b);
(t) other Investments (including Investments in connection the acquisition of Foreign Subsidiaries or other Persons (including Non-Compliant Subsidiaries and Non-Compliant Assets in connection with Permitted Acquisitions) that will not be Loan Parties), so long as, subject to Section 1.05, (A) the Total Leverage Ratio immediately after giving effect to any such activitiesInvestment, the security interests of the Lenders in the Collateral, taken as a whole, would not be materially impaired;
(t) Investments consisting of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference to this Section 6.04(t)) under Sections 6.01, 6.02, 6.03, 6.05 and 6.08, respectively;
(u) additional Investments; provided that after giving effect to such Investment (A) calculated on a Pro Forma BasisBasis at the time such Investment is made, the Total Net Leverage Ratio is less than or equal not in excess of 3.00 to 4.50 to 1.00 and 1.00, (B) there Holdings would be in compliance with Section 6.11(b) (calculated on a Pro Forma Basis at the time such Investment is made) as of the most recent fiscal quarter end for which Holdings was required to deliver financial statements pursuant to Section 5.01(a) or (b) and (C) no continuing Event of DefaultDefault shall have occurred and be continuing immediately before and after giving effect thereto;
(vi) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors in the case of a bankruptcy of Investments made by Holdings or the Borrower;
any Subsidiary in any TriNet Trust and (wii) to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials Investments made by any TriNet Trust in Holdings or equipment or purchases, acquisitions, licenses or leases of any other assets, Intellectual Property, or other rightsSubsidiary, in each case in the ordinary course of business;
(xv) Investments by an Unrestricted Subsidiary entered into prior to the day such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to the definition of “Unrestricted Subsidiary”;
(y) Investments consisting of purchases of assets of Franchisees (including, but not limited to, area development contracts owned by Franchisees) in the ordinary course of business or otherwise in an amount not exceeding $60,000,000, so long as (A) no Default or Event of Default shall have occurred and be continuing immediately before and (B) the Borrower is in pro forma compliance with the Financial Covenant after giving effect to thereto, additional Investments in the form of Call Spread Options at the time of the issuance of any such purchase;
(z) So unsecured convertible notes of Holdings which are convertible into shares of common stock of Holdings so long as no Event of Default shall have occurred and be continuing, Investments in Franchisees (including, but not limited to, (i) Guarantees or other credit support of any Indebtedness and other liabilities thereof and (ii) loans, advances or contributions to the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater of $20,000,000 and 70% of Consolidated EBITDA;
(aa) Investments consisting of accounts and payment intangibles owing to the Borrower or any purchase price for such Call Spread Option is netted out of the Restricted Subsidiaries from Franchisees; provided that cash proceeds of the issuance of such obligation shall be on such terms as the Borrower or the applicable Restricted Subsidiary establishes in good faithconvertible notes; and
(bbw) any other Investments consisting of advances or expenditures not otherwise permitted by any Loan Party to, or on behalf of, any CMF Subsidiary in support of advertising and marketing programs this Section 6.04 not to exceed $20,000,000 in the ordinary course consistent with current practicesaggregate. For purposes Notwithstanding anything contrary set forth above, if any Investment is denominated in a foreign currency, no fluctuation in currency values shall result in a breach of determining compliance with this Section 6.04. In addition, in the event that a Loan Party makes an Investment in an Excluded Subsidiary for purposes of permitting such Excluded Subsidiary or any item of Investment meets other Excluded Subsidiary to apply the criteria of more than one of the categories of Investments described in clauses (a) through (bb) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such amounts received by it to make a substantially concurrent Investment (or which may be made through any portion thereofother Excluded Subsidiary) and will only permitted hereunder, such substantially concurrent Investment by such Excluded Subsidiary shall not be required included as an Investment for purposes of this Section 6.04 to include the amount and type of such extent that the initial Investment in one or more of by the above clausesLoan Party reduced amounts available to make Investments hereunder.
Appears in 1 contract
Samples: Credit Agreement (Trinet Group Inc)
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor the The Borrower willwill not, nor and will they not permit any Restricted Subsidiary or Intermediate Parent to, make or hold any Investment, except:
(a) Permitted Investments at the time such Permitted Investment is madeInvestments;
(b) loans or advances to current or former officers, directors and employees of Holdings, any Intermediate Parent, the Borrower and the its Restricted Subsidiaries (i) for reasonable and customary business-related travel, entertainment, relocation and analogous ordinary business purposes, (ii) in connection with such Person’s purchase of Equity Interests in Holdings (or any direct or indirect parent thereof) of the Borrower (provided that the amount of such loans and advances made in cash to such Person shall be contributed to the Borrower in cash as common equity or Qualified Equity Interests) and (iii) for purposes not described in the foregoing clauses (i) and (ii); provided that at the time of incurrence thereof and after giving Pro Forma Effect thereto, the in an aggregate principal amount outstanding in reliance on this clause (iii) shall at any time not to exceed $1,000,0007,500,000;
(c) Investments (i) by Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary in any of HoldingsLoan Party, (ii) by any Intermediate ParentRestricted Subsidiary that is not a Loan Party in any other Restricted Subsidiary that is also not a Loan Party, (iii) by the Borrower or any Restricted Subsidiary (A) in any Restricted Subsidiary; provided that the aggregate outstanding amount of such Investments made by Loan Parties after the Effective Date in Restricted Subsidiaries that are not Loan Parties in reliance on this clause (ciii)(A) (together with the amount of Investments made in Restricted Subsidiaries that are not Loan Parties pursuant to Sections 6.04(h) and 6.04(p)) shall not exceed the greater Non-Loan Party Investment Amount at the time of $10,000,000 any such Investment, (B) in any Restricted Subsidiary that is not a Loan Party, constituting an exchange of Equity Interests of such Restricted Subsidiary for Indebtedness of such Restricted Subsidiary or (C) constituting Guarantees of Indebtedness or other monetary obligations of Restricted Subsidiaries that are not Loan Parties owing to any Loan Party, (iv) by the Borrower or any Restricted Subsidiary in Restricted Subsidiaries that are not Loan Parties so long as such Investment is part of a series of simultaneous Investments that result in the proceeds of the initial Investment being invested in one or more Loan Parties and 35% (v) by the Borrower or any Restricted Subsidiary in any Restricted Subsidiary that is not a Loan Party, consisting of Consolidated EBITDAthe contribution of Equity Interests of any other Restricted Subsidiary that is not a Loan Party so long as the Equity Interests of the transferee Restricted Subsidiary is pledged to secure the Secured Obligations;
(d) Investments consisting of prepayments to suppliers extensions of trade credit and accommodation guarantees in the ordinary course of business;
(e) Investments consisting of extensions of trade credit in the ordinary course of business;
(f) Investments (i) existing or contemplated on the date hereof and set forth on Schedule 6.04(f6.04(e) and any modification, replacement, renewal, reinvestment or extension thereof and (ii) Investments existing on the date hereof by Holdings, the Borrower or any Restricted Subsidiary in the Borrower or any Restricted Subsidiary and any modification, renewal or extension thereof; provided that that, in each case, the amount of the original Investment is not increased except by the terms of such Investment to the extent as set forth on Schedule 6.04(f6.04(e) or as otherwise permitted by this Section 6.04;
(gf) Investments in Swap Agreements permitted under Section 6.01(a)(vi);
(hg) promissory notes and other non-cash consideration received in connection with Dispositions permitted by Section 6.05;
(ih) Permitted Acquisitions; provided that the aggregate amount of cash consideration paid or provided by the Borrower or any other Loan Party or any Restricted Subsidiary after the Effective Date in reliance on this Section 6.04(h) (together with any Investments made in Restricted Subsidiaries that are not Loan Parties pursuant to Sections 6.04(c)(iii)(A) and 6.04(p)) for Permitted Acquisitions (including the aggregate principal amount of all Indebtedness assumed in connection with Permitted Acquisitions) for any Restricted Subsidiary that shall not be or, after giving effect to such Permitted Acquisition, shall not become a Loan Party (or for assets that are not purchased by, or promptly contributed to, a Loan Party), shall not exceed the Non-Loan Party Investment Amount at such time, which amount shall be increased by any proceeds from the Available Amount;
(j) the Transactions;
(ki) Investments in the ordinary course of business consisting of Uniform Commercial Code Article 3 endorsements for collection or deposit and Uniform Commercial Code Article 4 customary trade arrangements with customers consistent with past practices;
(lj) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers and customers, from financially troubled account debtors customers or in settlement of delinquent obligations of, or other disputes with, customers and suppliers or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment;
(mk) loans and advances to Holdings the Borrower (or any direct or indirect parent thereof) or any Intermediate Parent in lieu of, and not in excess of the amount of (after giving effect to any other loans, advances or Restricted Payments in respect thereof), Restricted Payments to the extent permitted to be made to Holdings the Borrower (or such parent) or such Intermediate Parent in accordance with Section 6.08(a6.06(a)(iv), (v), (vii), or (ix);
(nl) additional so long as no Event of Default shall have occurred and be continuing or would immediately result therefrom, other Investments and other acquisitionsby the Borrower or any Restricted Subsidiary; provided that at the time any such Investment or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition all Investments made in reliance on this clause (n), together with the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (n), l) shall not exceed the sum of (A) the greater of $18,000,000 and 60% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Investment or other acquisition, plus (B) so long as no Event of Default has occurred and is continuing, the Available Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of at such Investmenttime;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby;
(pm) advances of payroll payments to employees in the ordinary course of business;
(qn) Investments and other acquisitions to the extent that payment for such Investments is made with Qualified Equity Interests (excluding Cure Amounts) of Holdings (or any direct or indirect parent thereof or the IPO Entity); provided that (i) such amounts used pursuant to this clause (q) shall not increase the Available Amount and (ii) any amounts used for such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof or the IPO Entity) shall otherwise be permitted pursuant to this Section 6.04[reserved];
(ro) Investments of a Restricted Subsidiary acquired after the Effective Date or of a Person merged merged, amalgamated or consolidated with any Restricted Subsidiary in accordance with this Section and Section 6.03 after the Effective Date (other than existing Investments in Restricted Subsidiaries of such Restricted Subsidiary or Person, which must comply with the requirements of Section 6.04(h) or 6.04(l)) to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger merger, amalgamation or consolidation and were in existence on the date of such acquisition, merger merger, amalgamation or consolidation;
(sp) acquisitions of, investments in, and loans and advances to, joint ventures and Unrestricted Subsidiaries by the Borrower and its Restricted Subsidiaries, so long as the aggregate amount invested, loaned or advanced pursuant to this Section 6.04(p) (determined without regard to any write-downs or write-offs of such investments, loans or advances), together with any Investments made in Restricted Subsidiaries that are not Loan Parties pursuant to Sections 6.04(c)(iii)(A) and 6.04(h), does not exceed the Non-Loan Party Investment Amount at such time;
(q) Investments not to exceed $20,000,000 in the aggregate with the proceeds of Sterling Revolving Loans in the form of intercompany loans to non-cash Investments in connection with tax planning and reorganization activitiesLoan Parties; provided that after giving effect to any all such activitiesIndebtedness of such non-Loan Parties shall be evidenced by the Effective Date Intercompany Note and pledged as Collateral for the Secured Obligations;
(r) Investments (A) for utilities, the security interests of the Lenders deposits, leases and similar prepaid expenses incurred in the Collateralordinary course of business and (B) trade accounts created, taken as a wholeor prepaid expenses accrued, would not be materially impairedin the ordinary course of business;
(s) the licensing, sublicensing or contribution of rights in any Intellectual Property pursuant to joint marketing arrangements with Persons other than the Borrower and its Restricted Subsidiaries in the ordinary course of business;
(t) Investments consisting to the extent that payment for such Investments is made solely by the issuance of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted Equity Interests (other than by reference Disqualified Equity Interests) of the Borrower (or any direct or indirect parent of the Borrower) to this Section 6.04(t)) under Sections 6.01, 6.02, 6.03, 6.05 and 6.08, respectivelythe seller of such Investments;
(u) additional Investments; provided any Investments in a Subsidiary that after giving effect is not a Loan Party or in a joint venture, in each case, to the extent such Investment (A) on is contemporaneously repaid in full with a Pro Forma Basis, the Total Net Leverage Ratio is less than dividend or equal to 4.50 to 1.00 and (B) there is no continuing Event of Defaultother distribution from such Subsidiary or joint venture;
(v) contributions the forgiveness or conversion to Equity Interests of any Indebtedness owed by a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the BorrowerLoan Party and permitted by Section 6.02;
(w) Restricted Subsidiaries of Borrower may be established or created if the Borrower and such Restricted Subsidiary comply with the requirements of Section 5.11, if applicable; provided that, in each case, to the extent such new Restricted Subsidiary is created solely for the purpose of consummating an acquisition permitted by this Section 6.04, and such new Restricted Subsidiary at no time holds any assets or liabilities other than any merger consideration contributed to it contemporaneously with the closing of such transactions, such new Restricted Subsidiary shall not be required to take the actions set forth in Section 5.11, as applicable, until the respective acquisition is consummated (at which time the surviving entity of the respective transaction shall be required to so comply in accordance with the provisions thereof);
(x) to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials or and equipment or purchases, acquisitions, purchases of contract rights or licenses or leases of other assets, Intellectual Property, or other rightsintellectual property, in each case in the ordinary course of business;
(xy) Investments by an Unrestricted Subsidiary entered into prior to received substantially contemporaneously in exchange for, or the day payment of which is made with, Equity Interests of the Borrower; provided that (i) no Change in Control would result therefrom, and (ii) such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to the definition of “Unrestricted Subsidiary”Equity Interests do not constitute Disqualified Equity Interests;
(yz) Investments consisting Guarantees by (i) the Borrower or any Guarantor of purchases operating leases (other than Capital Lease Obligations) or of assets of Franchisees (includingother obligations that do not constitute Indebtedness, but not limited toin each case, area development contracts owned entered into by Franchisees) the Borrower or any Guarantor in the ordinary course of business or otherwise in an amount not exceeding $60,000,000, so long as (A) no Event of Default shall have occurred and be continuing and (B) the Borrower is in pro forma compliance with the Financial Covenant after giving effect to any such purchase;
(z) So long as no Event of Default shall have occurred and be continuing, Investments in Franchisees (including, but not limited to, (i) Guarantees or other credit support of any Indebtedness and other liabilities thereof and (ii) loansany Subsidiary that is not a Loan Party of operating leases (other than Capital Lease Obligations) or of obligations that do not constitute Indebtedness, advances or contributions to in each case, entered into by any Subsidiary that is not a Loan Party in the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater ordinary course of $20,000,000 and 70% of Consolidated EBITDAbusiness;
(aa) Investments consisting of accounts and payment intangibles owing to the Borrower or any extent constituting Investments, reorganizations and other activities related to tax planning and reorganization, so long as, after giving effect thereto, the Collateral granted to the Administrative Agent for the benefit of the Restricted Subsidiaries from Franchisees; provided that such obligation shall be on such terms as Lenders or Guarantees in favor of the Borrower or the applicable Restricted Subsidiary establishes Lenders, in good faith; andeach case, is not materially impaired;
(bb) Investments consisting of advances or expenditures by Loan Parties in any Restricted Subsidiary that is not a Loan Party to, or on behalf of, any CMF Subsidiary so long as such Investment is part of a series of simultaneous Investments by the Borrower and the Restricted Subsidiaries in support of advertising and marketing programs other Restricted Subsidiaries that result in the ordinary course consistent with current practices. For purposes of determining compliance with this Section 6.04, in the event that any item of Investment meets the criteria of more than one proceeds of the categories of Investments described in clauses (a) through (bb) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such intercompany Investment (or any portion thereof) and will only be required to include the amount and type of such Investment being invested in one or more Loan Parties;
(cc) other Investments (including acquisitions) by the Borrower or any Restricted Subsidiary not to exceed, in the aggregate, at any time outstanding, the greater of (x) $35,000,000 and (y) 3.5% of Consolidated Total Assets for the most recently ended Test Period (as determined at the time of such Investment);
(dd) Investments not to exceed 100% of the above clausesnet cash proceeds from the issuance or sale of Qualified Equity Interests (other than Cure Amounts) of the Borrower; provided that such amounts used pursuant to this clause (dd) shall not increase the Available Amount or the amounts available pursuant to Section 6.01(a)(xxv), 6.06(a)(x), 6.06(a)(xvi) or 6.06(b)(ix); and
(ee) minority Investments in Persons that do not become Restricted Subsidiaries not to exceed, in the aggregate, the greater of (x) $10,000,000 and (y) 10.0% of Consolidated EBITDA for the most recently ended Test Period (as determined at the time of such Investment).
Appears in 1 contract
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor the Borrower will, nor will they permit any Restricted Subsidiary or Intermediate Parent to, make or hold any Investment, except:
(a) Permitted Investments at the time such Permitted Investment is made;
(b) loans or advances to present or former officers, directors directors, managers, members of management, consultants, independent contractors and employees of Holdings, any Intermediate Parent, the Borrower Holdings and the Restricted Subsidiaries (i) for reasonable and customary business-related travel, entertainment, relocation and analogous ordinary business purposes, (ii) in connection with such Person’s purchase of Equity Interests in Holdings (or any direct or indirect parent thereof) (provided that the amount of such loans and advances made in cash to such Person shall be contributed to the Borrower Holdings in cash as common equity or Qualified Equity Interests) and (iii) for purposes not described in the foregoing clauses (i) and (ii); provided that at the time of incurrence thereof and after giving Pro Forma Effect pro forma effect thereto, the aggregate principal amount outstanding in reliance on this clause (iii) shall not exceed $1,000,0002,500,000;
(c) Investments (i) by Holdings or any Restricted Subsidiary in any Loan Party (other than Holdings (except to the extent the proceeds of any such Investment are promptly invested in a Restricted Subsidiary in a transaction otherwise permitted hereunder)); provided that to the extent the aggregate amount of Investments by a Restricted Subsidiary that is not a Loan Party in a Loan Party exceeds $1,000,000, such non-Loan Party Restricted Subsidiary shall have acceded to the Pari Passu Intercreditor Agreement pursuant to the terms thereof, (ii) by any Restricted Subsidiary that is not a Loan Party in any other Restricted Subsidiary that is also not a Loan Party, (iii) by Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary (A) in any of Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary; provided that (x) the aggregate outstanding amount of such Investments made by Loan Parties after the Effective Date in Restricted Subsidiaries that are not Loan Parties in reliance on this clause (iii)(A), together with the aggregate amount of (x) all other Investments made in and Dispositions made to Restricted Subsidiaries that are not Loan Parties by any Loan Parties after the Effective Date and (y) all Investments and Dispositions made in reliance on Section 6.16(ii), shall not exceed, at the time of the making thereof and after giving pro forma effect thereto, $7,500,000, (y) no Event of Default has occurred and is continuing and (z) all Investments made by Loan Parties in Restricted Subsidiaries that are not Loan Parties in reliance on this clause (ciii)(A) shall be made only for the purpose of financing working capital needs of such non Loan Parties or another purpose agreed to by the Required Lenders (such consent not exceed to be 104 unreasonably withheld, conditioned or delayed; provided, that it is acknowledged and agreed that it shall not be unreasonable to withhold consent to any such transaction that will have a material adverse impact on the greater Guarantees or the Collateral) and shall be evidenced by an intercompany note that has been pledged as Collateral, (B) [reserved] or (C) constituting Guarantees of $10,000,000 Indebtedness or other monetary obligations of Restricted Subsidiaries that are not Loan Parties owing to any Loan Party, (iv) by Holdings, the Borrower or any Restricted Subsidiary in Restricted Subsidiaries that are not Loan Parties so long as such transaction is part of a series of simultaneous transactions that results in the proceeds of the initial Investment being invested in one or more Loan Parties (other than Holdings), (v) subject to the consent of the Required Lenders (such consent not to be unreasonably withheld, conditioned or delayed; provided, that it is acknowledged and 35% agreed that it shall not be unreasonable to withhold consent to any such transaction that will have a material adverse impact on the Guarantees or the Collateral), by Holdings, the Borrower or any Restricted Subsidiary in any Restricted Subsidiary that is not a Loan Party, consisting of Consolidated EBITDAthe contribution of Equity Interests of any other Restricted Subsidiary that is not a Loan Party so long as the Equity Interests of the transferee Restricted Subsidiary is pledged to secure the Secured Obligations;
(d) Investments consisting of deposits, prepayments and/or other credits to suppliers in the ordinary course of business;
(e) Investments consisting of extensions of trade credit in the ordinary course of business;
(f) Investments (i) existing or contemplated on the date hereof and set forth on Schedule 6.04(f) and any modification, replacement, renewal, reinvestment or extension thereof and (ii) Investments existing on the date hereof Effective Date by Holdings, the Borrower or any Restricted Subsidiary in the Borrower or any Restricted Subsidiary and any modification, renewal or extension thereof; provided that the amount of the original Investment is not increased except by the terms of such Investment to the extent as set forth on Schedule 6.04(f) or as otherwise permitted by this Section 6.04;
(g) Investments in Swap Agreements permitted under Section 6.01(a)(vi)6.01;
(h) promissory notes and other non-cash consideration received in connection with Dispositions permitted by Section 6.05;
(i) Permitted AcquisitionsInvestments made in connection with the Transactions (other than borrowings under the ABL North America Credit Agreement);
(j) subject to the Transactionsconsent of the Required Lenders (such consent not to be unreasonably withheld, conditioned or delayed; provided, that it is acknowledged and agreed that it shall not be unreasonable to withhold consent to any such transaction that will have a material adverse impact on the Guarantees or the Collateral), Investments made by any Loan Party in any non-Loan Party consisting of contributions or other Dispositions of Equity Interests of Persons that are non-Loan Parties; provided that, prior to such contribution or Disposition, such Equity Interests were not owned directly by a Loan Party or such Equity Interests are contributed or disposed to a Non-Loan Party that is a wholly owned Restricted Subsidiary of a Loan Party;
(k) Investments in the ordinary course of business consisting of endorsements for collection or deposit and customary trade arrangements with customers consistent with past practices;
(l) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers and customers, from financially troubled account debtors or in settlement of delinquent obligations of, or other disputes with, 105 customers and suppliers or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment;
(m) loans subject to the consent of the Required Lenders (such consent not to be unreasonably withheld, conditioned or delayed; provided, that it is acknowledged and advances agreed that it shall not be unreasonable to Holdings withhold consent to any such transaction that will have a material adverse impact on the Guarantees or the Collateral), cash or property distributed from any Restricted Subsidiary that is not a Loan Party (or any direct or indirect parent thereofi) or any Intermediate Parent in lieu ofmay be contributed to other Restricted Subsidiaries that are not Loan Parties, and not (ii) may pass through Holdings, the Borrower and/or any intermediate Restricted Subsidiaries in excess of order to effect the amount of contribution described in clause (after giving effect to any other loans, advances or Restricted Payments in respect thereofi), Restricted Payments to the extent so long as part of a series of related transactions and such transaction steps are not unreasonably delayed and are otherwise permitted to be made to Holdings (or such parent) or such Intermediate Parent in accordance with Section 6.08(a)hereunder;
(n) additional Investments and other acquisitionsacquisitions made and held by the Loan Parties (other than Holdings); provided that at the time any such Investment or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition made in reliance on this clause (n), together with (including the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (n)), whether in the form of Indebtedness assumed or otherwise), shall not exceed the sum of (A) the greater of $18,000,000 and 60% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Investment or other acquisition, plus (B) so long as no Event of Default has occurred and is continuing, the Available Amount that is Not Otherwise Applied as in effect immediately prior to at the time of making incurrence thereof and after giving pro forma effect thereto, $2,500,000; provided that (x) the aggregate amount of such InvestmentInvestments made by Loan Parties after the Effective Date in Restricted Subsidiaries that are not Loan Parties in reliance on this clause (n), together with the aggregate amount of (x) all other Investments made in and Dispositions made to Restricted Subsidiaries that are not Loan Parties by Loan Parties after the Effective Date and (y) all Investments and Dispositions made in reliance on Section 6.16(ii), shall not exceed, at the time of the making thereof and after giving pro forma effect thereto, $7,500,000 at any time outstanding and (y) all Investments made by Loan Parties in Restricted Subsidiaries that are not Loan Parties in reliance on this clause (n) shall be made only for the purpose of financing working capital needs of such non Loan Parties or another purpose agreed to by the Required Lenders (such consent not to be unreasonably withheld, conditioned or delayed; provided, that it is acknowledged and agreed that it shall not be unreasonable to withhold consent to any such transaction that will have a material adverse impact on the Guarantees or the Collateral) and shall be evidenced by an intercompany note that has been pledged as Collateral;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby[reserved];
(p) advances of payroll payments to employees in the ordinary course of business;
(q) Investments and other acquisitions to the extent that payment for such Investments is made with Qualified Equity Interests (excluding Cure Amounts) of Holdings (or any direct or indirect parent thereof or the IPO Entity)Holdings; provided that (i) such amounts used pursuant to this clause (q) shall not increase the Available Amount and (ii) any other amounts used for such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof or the IPO Entity) shall otherwise be permitted pursuant to this Section 6.04;
(r) Investments of a Subsidiary acquired after the Effective Date or of a Person merged or consolidated with any Subsidiary in accordance with this Section and Section 6.03 after the Effective Date to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger or consolidation and were in existence on the date of such acquisition, merger or consolidation[reserved];
(s) non-cash Investments in connection with tax planning and reorganization activities; provided that after giving effect to any such activities, the security interests of the Lenders in the Collateral, taken as a whole, would not be materially impaired[reserved];
(t) Investments consisting of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference to this Section 6.04(t)) under Sections 6.01, 6.02, 6.03, 6.05 and 6.08, respectively;
(u) additional Investments[reserved]; provided that after giving effect to such Investment (A) on a Pro Forma Basis, the Total Net Leverage Ratio is less than or equal to 4.50 to 1.00 and (B) there is no continuing Event of Default;106
(v) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers of Holdings or any Restricted Subsidiary or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the BorrowerHoldings;
(w) to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Property, or other rights, in each case in the ordinary course of business;
(x) Investments by an Unrestricted Subsidiary entered into prior to the day such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to the definition of “Unrestricted Subsidiary”[reserved];
(y) Investments consisting of purchases of assets of Franchisees (including, but not limited to, area development contracts owned by Franchisees) in the ordinary course of business or otherwise in an amount not exceeding $60,000,000, so long as (A) no Event of Default shall have occurred and be continuing and (B) the Borrower is in pro forma compliance with the Financial Covenant after giving effect to any such purchase[reserved];
(z) So long as no Event of Default shall have occurred and be continuing, Investments in Franchisees (including, but not limited to, (i) Guarantees or other credit support of any Indebtedness and other liabilities thereof and (ii) loans, advances or contributions to the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater of $20,000,000 and 70% of Consolidated EBITDA[reserved];
(aa) Investments consisting of accounts and payment intangibles owing to the Borrower or any of the Restricted Subsidiaries from Franchisees; provided that such obligation shall be on such terms as the Borrower or the applicable Restricted Subsidiary establishes in good faith[reserved]; and
(bb) Investments consisting unfunded pension fund and other employee benefit plan obligations and liabilities to the extent that the same are permitted to remain unfunded under applicable Requirements of advances or expenditures by any Loan Party to, or on behalf of, any CMF Subsidiary in support of advertising and marketing programs in the ordinary course consistent with current practices. For purposes of determining compliance with this Section 6.04, in the event that any item of Investment meets the criteria of more than one of the categories of Investments described in clauses (a) through (bb) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such Investment (or any portion thereof) and will only be required to include the amount and type of such Investment in one or more of the above clausesLaw.
Appears in 1 contract
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor the The Borrower willwill not, nor and will they not permit any Restricted Subsidiary or Intermediate Parent to, make or hold any Investment, except:
(a) Permitted Investments at the time such Permitted Investment is madeInvestments;
(b) loans or advances to officers, directors and employees of Holdings, any Intermediate Parent, the Borrower and the Restricted Subsidiaries (i) for reasonable and customary business-related travel, entertainment, relocation and analogous ordinary business purposes, (ii) in connection with such Person’s purchase of Equity Interests in Holdings (or any direct or indirect parent thereof) of the Borrower (provided that the amount of such loans and advances made in cash to such Person shall be contributed to the Borrower in cash as common equity or Qualified Equity Interests) and (iii) for purposes not described in the foregoing clauses (i) and (ii); provided that at the time of incurrence thereof and after giving Pro Forma Effect thereto, the in an aggregate principal amount outstanding in reliance on this clause (iii) shall at any time not to exceed $1,000,0005,000,000;
(c) Investments (i) by Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary in any of Holdings, any Intermediate Parent, the Borrower or any Subsidiary Loan Party (excluding any new Restricted Subsidiary that becomes a Subsidiary Loan Party pursuant to such Investment), (ii) by any Restricted Subsidiary that is not a Loan Party in any other Restricted Subsidiary that is also not a Loan Party (including any Regulated Subsidiary in any other Regulated Subsidiary), (iii) by the Borrower or any Restricted Subsidiary (A) in any Restricted Subsidiary; provided that the aggregate outstanding amount of such Investments made by Loan Parties after the Effective Date in Restricted Subsidiaries that are not Loan Parties in reliance on this clause (ciii)(A) (together with the amount of Investments made in Restricted Subsidiaries that are not Loan Parties pursuant to Section 6.04(h)) shall not exceed $40,000,000 at the greater time of $10,000,000 any such Investment, (B) in any Restricted Subsidiary that is not a Loan Party, constituting an exchange of Equity Interests of such Restricted Subsidiary for Indebtedness of such Subsidiary or (C) constituting Guarantees of Indebtedness or other monetary obligations of Restricted Subsidiaries that are not Loan Parties owing to any Loan Party, (iv) by the Borrower or any Restricted Subsidiary in Restricted Subsidiaries that are not Loan Parties so long as such Investment is part of a series of simultaneous Investments that result in the proceeds of the initial Investment being invested in one or more Loan Parties and 35% (v) by the Borrower or any Restricted Subsidiary in any Restricted Subsidiary that is not a Loan Party, consisting of Consolidated EBITDAthe contribution of Equity Interests of any other Restricted Subsidiary that is not a Loan Party so long as the Equity Interests of the transferee Restricted Subsidiary are pledged to secure the Secured Obligations;
(d) Investments consisting of prepayments to suppliers extensions of trade credit and accommodation guarantees in the ordinary course of business;
(e) Investments consisting of extensions of trade credit in the ordinary course of business;
(f) Investments (i) existing or contemplated on the date hereof Effective Date and set forth on Schedule 6.04(f6.04(e) and any modification, replacement, renewal, reinvestment or extension thereof and (ii) Investments existing on the date hereof Effective Date by Holdings, the Borrower or any Restricted Subsidiary in the Borrower or any Restricted Subsidiary and any modification, renewal or extension thereof; provided that the amount of the original Investment is not increased except by the terms of such Investment to the extent as set forth on Schedule 6.04(f6.04(e) or as otherwise permitted by this Section 6.04;
(gf) Investments in Swap Agreements permitted under Section 6.01(a)(vi)incurred in the ordinary course of business and not for speculative purposes;
(hg) promissory notes and other non-cash consideration received in connection with Dispositions permitted by Section 6.05;
(ih) Permitted Acquisitions; provided that (i) the aggregate amount of consideration paid or provided by the Borrower or any other Loan Party after the Effective Date in reliance on this Section 6.04(h) (together with the amount of Investments made in Restricted Subsidiaries that are not Loan Parties pursuant to Section 6.04(c)) for Permitted Acquisitions for any Restricted Subsidiary that shall not be, or, after giving effect to such Permitted Acquisition, shall not become, a Loan Party and for any assets that shall not be, or after giving effect to such Permitted Acquisition shall not become, Collateral, shall not exceed $40,000,000 at such time; (ii) no Default or Event of Default has occurred or is continuing at the time of consummation of such Investment; and (iii) at the time of consummation of such Investment and immediately after giving effect thereto, the Borrower shall be in Pro Forma Compliance with the Financial Performance Covenant set forth in Section 6.11 as of the end of the most recently ended Test Period (and assuming that the Financial Performance Covenant is required to be tested for such Test Period, whether or not otherwise then in effect);
(i) Investments by the Borrower in any Restricted Subsidiary or by any Restricted Subsidiary in any other Restricted Subsidiary or the Borrower incurred in connection with intercompany tax withholding arrangements for the purpose of paying withholding tax on vesting restricted stock units as contemplated by Section 6.07(a)(iv);
(j) the Transactions;
(k) Investments in the ordinary course of business consisting of Uniform Commercial Code Article 3 endorsements for collection or deposit and Uniform Commercial Code Article 4 customary trade arrangements with customers consistent with past practices;
(lk) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers and customers, from financially troubled account debtors customers or in settlement of delinquent obligations of, or other disputes with, customers and suppliers or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment;
(ml) loans and advances to Holdings (or any direct or indirect parent thereof) or any Intermediate Parent the Borrower in lieu of, and not in excess of the amount of (after giving effect to any other loans, advances or Restricted Payments in respect thereof), Restricted Payments to the extent permitted to be made to Holdings the Borrower (or such parent) or such Intermediate Parent in accordance with Section 6.08(a6.07(a)(iv), (vi) or (vii);
(nm) additional other Investments and other acquisitions; provided that at the time any such Investment or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition all Investments made in reliance on this clause (nm), together with the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (nm) (including the aggregate principal amount of all Indebtedness assumed in connection with any such other acquisition), shall not exceed the sum of (A) the greater of $18,000,000 and 60% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Investment or other acquisition, Initial Restricted Payment Amount plus (B) so long as no Event of Default has occurred and is continuing, the Available Amount that is Not Otherwise Applied Applied, plus (C) the Available Equity Amount that is Not Otherwise Applied; provided further that, (x) the Total Leverage Ratio shall not exceed 2.50:1.00 as in effect immediately prior of such time determined on a Pro Forma Basis and (y) to the extent such Investment (A) constitutes a Limited Condition Acquisition, no Default or Event of Default is occurring or continuing at the time of making execution of the definitive documentation governing such Limited Condition Acquisition and (other than in connection with any Limited Condition Acquisition financed solely with the proceeds of any Incremental Facility or Incremental Equivalent Debt) and no Event of Default under Section 7.01(a), (b), (h) or (i) shall have occurred or be continuing at the time of consummation of such Limited Condition Acquisition) and (B) does not constitute a Limited Condition Acquisition, no Default or Event of Default is occurring or continuing at the time of consummation of such Investment;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby;
(pn) advances of payroll payments to employees in the ordinary course of business;
(qo) Investments and other acquisitions to the extent that payment for such Investments is made with Qualified Equity Interests (excluding Cure Amounts) of Holdings (or any direct or indirect parent thereof or the IPO Entity); provided that (i) such amounts used pursuant to this clause (q) shall not increase the Available Amount and (ii) any amounts used for such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof or the IPO Entity) shall otherwise be permitted pursuant to this Section 6.04Borrower;
(rp) Investments of a Subsidiary acquired after the Effective Date or of a Person merged or consolidated with any Subsidiary in accordance with this Section 6.04 and Section 6.03 after the Effective Date or that otherwise becomes a Subsidiary (provided that if such Investment is made under Section 6.04(h), existing Investments in subsidiaries of such Subsidiary or Person shall comply with the requirements of Section 6.04(h) or 6.04(m) or any other paragraph of this Section 6.04) to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger or consolidation and were in existence on the date of such acquisition, merger or consolidation;
(q) receivables (other than in respect of Indebtedness for borrowed money) owing to the Borrower or any Restricted Subsidiary, if created or acquired in the ordinary course of business;
(r) [reserved];
(s) non-cash Investments in connection with tax planning (A) for utilities, security deposits, leases and reorganization activities; provided that after giving effect to any such activities, the security interests of the Lenders similar prepaid expenses incurred in the Collateralordinary course of business and (B) trade accounts created, taken as a wholeor prepaid expenses accrued, would not be materially impairedin the ordinary course of business;
(t) Investments consisting in Joint Ventures in an aggregate amount not to exceed $10,000,000 at any time outstanding; provided that no Default or Event of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference to this Section 6.04(t)) under Sections 6.01, 6.02, 6.03, 6.05 and 6.08, respectivelyDefault has occurred or is continuing at the time of consummation of such Investment;
(u) additional [reserved];
(v) [reserved]; and
(w) other Investments; provided that after giving effect to such Investment (A) on a Pro Forma Basis, (A) the Total Net Leverage Ratio is less than or equal to 4.50 to 1.00 and 1.50:1.00 as of such time determined on a Pro Forma Basis, (B) there is no continuing Event of Default;
(v) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the Borrower;
(w) to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Property, or other rights, in each case in the ordinary course of business;
such Investment (x) Investments by an Unrestricted Subsidiary entered into prior to constitutes a Limited Condition Acquisition, no Default or Event of Default is occurring or continuing at the day time of execution of the definitive documentation governing such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to Limited Condition Acquisition and (other than in connection with any Limited Condition Acquisition financed solely with the definition proceeds of “Unrestricted Subsidiary”;
(yany Incremental Facility or Incremental Equivalent Debt) Investments consisting of purchases of assets of Franchisees (including, but not limited to, area development contracts owned by Franchisees) in the ordinary course of business or otherwise in an amount not exceeding $60,000,000, so long as (A) and no Event of Default under Section 7.01(a), (b), (h) or (i) shall have occurred and or be continuing at the time of consummation of such Limited Condition Acquisition) and (By) the Borrower is in pro forma compliance with the Financial Covenant after giving effect to any such purchase;
(z) So long as does not constitute a Limited Condition Acquisition, no Default or Event of Default shall have occurred and be continuing, Investments in Franchisees (including, but not limited to, (i) Guarantees is occurring or other credit support continuing at the time of any Indebtedness and other liabilities thereof and (ii) loans, advances or contributions to the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater of $20,000,000 and 70% of Consolidated EBITDA;
(aa) Investments consisting of accounts and payment intangibles owing to the Borrower or any of the Restricted Subsidiaries from Franchisees; provided that such obligation shall be on such terms as the Borrower or the applicable Restricted Subsidiary establishes in good faith; and
(bb) Investments consisting of advances or expenditures by any Loan Party to, or on behalf of, any CMF Subsidiary in support of advertising and marketing programs in the ordinary course consistent with current practices. For purposes of determining compliance with this Section 6.04, in the event that any item of Investment meets the criteria of more than one of the categories of Investments described in clauses (a) through (bb) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such Investment (or any portion thereof) and will only be required to include the amount and type consummation of such Investment in one or more and (C) the aggregate outstanding principal amount of the above clausesTerm Facility is no greater than $200,000,000.
Appears in 1 contract
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor the The Borrower willwill not, nor and will they not permit any Restricted Subsidiary or Intermediate Parent of the Subsidiaries to, make or hold any Investment, Investment except:
(a) Permitted Investments at the time such Permitted Investment is madeInvestments;
(b) loans or advances to officers, directors and employees Investments of Holdings, any Intermediate Parent, the Borrower and the Restricted Subsidiaries (i) for reasonable Subsidiary Loan Parties and customary business-related travel, entertainment, relocation and analogous ordinary business purposes, (ii) in connection with such Person’s purchase of Equity Interests in Holdings (or any direct or indirect parent thereof) (provided that the amount of such loans and advances made in cash to such Person shall be contributed to the Borrower in cash as common equity or Qualified Equity Interests) and (iii) for purposes not described in the foregoing clauses (i) and (ii); provided that at the time of incurrence thereof and after giving Pro Forma Effect thereto, the aggregate principal amount outstanding in reliance set forth on this clause (iii) shall not exceed $1,000,000Schedule 6.04;
(c) Investments Guarantees of Indebtedness and/or Guarantees consisting of Indebtedness permitted by Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary in any of Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary; provided that the aggregate outstanding amount of Investments made by Loan Parties in Restricted Subsidiaries that are not Loan Parties in reliance on this clause (c) shall not exceed the greater of $10,000,000 and 35% of Consolidated EBITDASection 6.01;
(d) Investments consisting of prepayments to suppliers in the ordinary course of business;
(e) Investments consisting of extensions of trade credit in the ordinary course of business;
(f) Investments (i) existing or contemplated on the date hereof and set forth on Schedule 6.04(f) and any modification, replacement, renewal, reinvestment or extension thereof and (ii) Investments existing on the date hereof by Holdings, the Borrower or any Restricted Subsidiary in the Borrower or any Restricted Subsidiary and any modification, renewal or extension thereof; provided that the amount of the original Investment is not increased except by the terms of such Investment to the extent as set forth on Schedule 6.04(f) or as otherwise permitted by this Section 6.04;
(g) Investments in Swap Agreements permitted under Section 6.01(a)(vi);
(h) promissory notes and other non-cash consideration received in connection with Dispositions permitted by Section 6.05;
(i) Permitted Acquisitions;
(j) the Transactions;
(k) Investments in the ordinary course of business consisting of endorsements for collection or deposit and customary trade arrangements with customers consistent with past practices;
(l) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers and customersof, from financially troubled account debtors or in settlement of delinquent obligations of, or other accounts and disputes with, customers and suppliers or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment;
(m) loans and advances to Holdings (or any direct or indirect parent thereof) or any Intermediate Parent in lieu of, and not in excess of the amount of (after giving effect to any other loans, advances or Restricted Payments in respect thereof), Restricted Payments to the extent permitted to be made to Holdings (or such parent) or such Intermediate Parent in accordance with Section 6.08(a);
(n) additional Investments and other acquisitions; provided that at the time any such Investment or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition made in reliance on this clause (n), together with the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (n), shall not exceed the sum of (A) the greater of $18,000,000 and 60% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Investment or other acquisition, plus (B) so long as no Event of Default has occurred and is continuing, the Available Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of such Investment;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby;
(p) advances of payroll payments to employees in the ordinary course of business;
(q) Investments and other acquisitions to the extent that payment for such Investments is made with Qualified Equity Interests (excluding Cure Amounts) of Holdings (or any direct or indirect parent thereof or the IPO Entity); provided that (i) such amounts used pursuant to this clause (q) shall not increase the Available Amount and (ii) any amounts used for such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof or the IPO Entity) shall otherwise be permitted pursuant to this Section 6.04;
(r) Investments of a Subsidiary acquired after the Effective Date or of a Person merged or consolidated with any Subsidiary in accordance with this Section and Section 6.03 after the Effective Date to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger or consolidation and were in existence on the date of such acquisition, merger or consolidation;
(s) non-cash Investments in connection with tax planning and reorganization activities; provided that after giving effect to any such activities, the security interests of the Lenders in the Collateral, taken as a whole, would not be materially impaired;
(t) Investments consisting of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference to this Section 6.04(t)) under Sections 6.01, 6.02, 6.03, 6.05 and 6.08, respectively;
(u) additional Investments; provided that after giving effect to such Investment (A) on a Pro Forma Basis, the Total Net Leverage Ratio is less than or equal to 4.50 to 1.00 and (B) there is no continuing Event of Default;
(v) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the Borrower;
(w) to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Property, or other rightssuppliers, in each case in the ordinary course of business;
(xe) Investments by an Unrestricted the Borrower or any Subsidiary entered into prior Loan Party in Subsidiary Loan Parties; provided that the Borrower and such Subsidiary Loan Party, as the case may be, shall comply with the applicable provisions of Section 5.11 with respect to the day such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to the definition of “Unrestricted any newly formed Subsidiary”;
(yf) Investments consisting of purchases non-cash consideration received in connection with any Asset Sale permitted by Section 6.05;
(g) Investments by the Subsidiaries in the Borrower; provided that the proceeds of assets such Investments are used for a purpose set forth in Section 5.10;
(h) [reserved];
(i) usual and customary loans and advances to employees, officers and directors of Franchisees (includingthe Borrower and the Subsidiaries, but not limited to, area development contracts owned by Franchisees) in the ordinary course of business business;
(j) Investments (other than Investments consisting of Equity Interests in Subsidiaries) by the Borrower or otherwise any of the Subsidiaries in Joint Ventures in an amount not exceeding to exceed $60,000,000, so long as 175,000,000 in the aggregate in any fiscal year of the Borrower;
(k) Investments in charitable foundations organized under Section 501(c) of the Code in an amount not to exceed $7,500,000 in the aggregate in any calendar year;
(l) any Investment consisting of a Hedging Agreement permitted by Section 6.07;
(m) Business Acquisitions and Investments that are not otherwise permitted under any other provision of this Section 6.04; provided that (A) at the time of such Business Acquisition or Investment no Event of Default shall have has occurred and be is continuing or would result therefrom and (B) the Borrower is in pro forma compliance with the Financial Covenant immediately after giving effect to any such purchaseBusiness Acquisition or Investment, (1) the ABL Availability is greater than $450,000,000463,500,000 or (2) (x) the ABL Availability is greater than $300,000,000309,000,000, and (y) the Consolidated Fixed Charge Coverage Ratio for the period of four consecutive fiscal quarters most recently ended on or prior to the date of such Business Acquisition or Investment, calculated on a pro forma basis as if such Business Acquisition or Investment (and any related incurrence of Indebtedness) were made on the first day of such period, shall not be less than 1.00 to 1.00;
(z) So long as no Event of Default shall have occurred and be continuing, Investments in Franchisees (including, but not limited to, (i) Guarantees or other credit support of any Indebtedness and other liabilities thereof and (ii) loans, advances or contributions to the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater of $20,000,000 and 70% of Consolidated EBITDA;
(aan) Investments consisting of accounts Sellers’ Retained Interests in Securitizations permitted by Sections 6.01 and payment intangibles owing 6.05;
(o) Investments by the Borrower or a Subsidiary in connection with a Securitization permitted pursuant to this Agreement and (B) any Investment or other Guarantee that may be deemed made by the Borrower due to the fact that a Parent Undertaking has been entered into in respect of a Securitization permitted pursuant to the Agreement;
(p) Investments by any Subsidiary that is not a Subsidiary Loan Party in any other Subsidiary that is not a Subsidiary Loan Party or in any Subsidiary Loan Party;
(q) Investments held by any Person that becomes a Subsidiary at the time such Person becomes a Subsidiary; provided that no such Investment was made in contemplation of such Person becoming a Subsidiary;
(r) Investments in any Escrow Notes Issuer related to any interest, premiums or other amounts payable in connection with any Escrow Notes issued by such Escrow Notes Issuer;
(s) Investments consisting of Guarantees by the Borrower or any of the Restricted its Subsidiaries from Franchisees; provided that such obligation shall be on such terms as of obligations of the Borrower or any of its Subsidiaries to the applicable Restricted Subsidiary establishes extent not constituting Indebtedness and incurred in good faiththe ordinary course of business; and
(bbt) other Investments consisting of advances by the Borrower or expenditures by any Subsidiary Loan Party to, or on behalf of, in any CMF Subsidiary that is not a Subsidiary Loan Party in support of advertising and marketing programs an amount not to exceed $50,000,000 in the ordinary course consistent with current practices. For purposes of determining compliance with this Section 6.04, in the event that aggregate at any item of Investment meets the criteria of more than one of the categories of Investments described in clauses (a) through (bb) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such Investment (or any portion thereof) and will only be required to include the amount and type of such Investment in one or more of the above clausestime.
Appears in 1 contract
Samples: Credit Agreement (Rite Aid Corp)
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor the Borrower willThe Issuer will not, nor and will they not permit any Restricted Subsidiary or Intermediate Parent to, make or hold any Investment, except:
(a) Permitted Investments at the time such Permitted Investment is mademade and purchases of assets in the ordinary course of business consistent with past practice;
(b) loans or advances to officers, directors members of the Board of Directors and employees of Holdings, any Intermediate Parent, the Borrower Issuer and the its Restricted Subsidiaries (i) for reasonable and customary business-related travel, entertainment, relocation and analogous ordinary business purposes, (ii) in connection with such Person’s purchase of Equity Interests in of Holdings (or any direct or indirect parent thereof) (provided that the amount of such loans and advances made in cash to such Person shall be contributed to the Borrower Issuer in cash as common equity or Qualified Equity Interests) and (iii) for purposes not described in the foregoing clauses (i) and (ii); provided that at the time of incurrence thereof and after giving Pro Forma Effect thereto, the in an aggregate principal amount outstanding in reliance on under this clause (iii) shall at any time not to exceed $1,000,00036,000,000;
(c) Investments by Holdings, the Issuer in any Intermediate Parent, the Borrower or Restricted Subsidiary and Investments by any Restricted Subsidiary in any of Holdings, any Intermediate Parent, the Borrower Issuer or any other Restricted Subsidiary; provided that, in the case of any Investment by a Note Party in a Restricted Subsidiary that the aggregate outstanding amount is not a Note Party, no Event of Investments made by Loan Parties in Restricted Subsidiaries that are not Loan Parties in reliance on this clause (c) Default shall not exceed the greater of $10,000,000 have occurred and 35% of Consolidated EBITDAbe continuing or would result therefrom;
(d) Investments consisting of prepayments to suppliers extensions of trade credit and accommodation guarantees in the ordinary course of business;
(e) Investments consisting of extensions of trade credit in the ordinary course of business;
(f) Investments (i) existing or contemplated on the date hereof Issue Date and set forth on Schedule 6.04(f) 5.04 and any modification, replacement, renewal, reinvestment or extension thereof and (ii) Investments existing on the date hereof Issue Date by Holdings, the Borrower Issuer or any Restricted Subsidiary in the Borrower Issuer or any Restricted Subsidiary and any modification, renewal or extension thereof; provided that the amount of the original Investment is not increased except by the terms of such Investment to the extent as set forth on Schedule 6.04(f) 5.04 or as otherwise permitted by this Section 6.045.04;
(gf) Investments in Swap Agreements permitted under Section 6.01(a)(vi)incurred in the ordinary course of business and not for speculative purposes;
(hg) promissory notes and other non-cash consideration received in connection with Dispositions permitted by Section 6.055.05;
(ih) Permitted Acquisitions;
(ji) the Transactions;
(kj) Investments in the ordinary course of business consisting of Uniform Commercial Code Article 3 endorsements for collection or deposit and Uniform Commercial Code Article 4 customary trade arrangements with customers consistent with past practicesin the ordinary course of business;
(lk) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers and customers, from financially troubled account debtors customers or in settlement of delinquent obligations of, or other disputes with, customers and suppliers or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment;
(ml) loans and advances to Holdings (or any direct or indirect parent thereof) or any Intermediate Parent (x) in lieu of, and not in excess of the amount of (after giving effect to any other loans, advances or Restricted Payments in respect thereof), Restricted Payments to the extent permitted to be made to Holdings (or such parent) or such Intermediate Parent in accordance with Section 6.08(a)5.07(a) and (y) to the extent the proceeds thereof are contributed or loaned or advanced to any Restricted Subsidiary;
(nm) additional Investments and other acquisitions; provided that at the time any such Investment or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition made in reliance on this clause (nm), together with the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (nm) (including the aggregate principal amount of all Indebtedness assumed in connection with any such other Investment or acquisition previously made under this clause (m)), shall not exceed the sum of (A) the greater of (i)(A) $18,000,000 235,000,000 and (B) 60% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Investment or other acquisition, plus (Bii) so long as immediately after giving effect to any such Investment (x) no Event of Default has occurred and is continuingcontinuing and (y) on a Pro Forma Basis, the Total Net Leverage Ratio does not exceed 7.50 to 1.00 for the most recently ended Test Period, the Available Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of such Investment plus (iii) the Available Equity Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of such Investment; plus (C) the General Restricted Payment Reallocated Amount; plus (D) the Junior Debt Payment Reallocated Amount;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby;
(pn) advances of payroll payments to employees in the ordinary course of business;
(qo) Investments and other acquisitions to the extent that payment for such Investments is made with Qualified Equity Interests (excluding Cure AmountsQualified Equity Interests the proceeds of which will be applied to cure any default under any “equity cure” provisions with respect to any financial maintenance covenant under the Credit Agreement) of Holdings (or any direct or indirect parent thereof or the IPO Entity); provided that (i) such amounts used pursuant to this clause (q) shall not increase the Available Amount and (ii) any amounts used for such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof or the IPO Entity) shall otherwise be permitted pursuant to this Section 6.04;
(rp) Investments of a Subsidiary acquired after the Effective Issue Date or of a Person merged merged, amalgamated or consolidated with any Subsidiary in accordance with this Section 5.04 and Section 6.03 5.03 after the Effective Issue Date or that otherwise becomes a Subsidiary (provided that if such Investment is made under Section 5.04(h), existing Investments in subsidiaries of such Subsidiary or Person shall comply with the requirements of Section 5.04(h)) to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger merger, amalgamation or consolidation and were in existence on the date of such acquisition, merger merger, amalgamation or consolidation;
(q) receivables owing to the Issuer or any Restricted Subsidiary, if created or acquired in the ordinary course of business;
(r) Investments (A) for utilities, security deposits, leases and similar prepaid expenses incurred in the ordinary course of business and (B) trade accounts created, or prepaid expenses accrued, in the ordinary course of business;
(s) non-cash Investments in connection with tax planning and reorganization activities; provided that after giving effect to any such activities, the security interests of the Lenders Holders in the Collateral, taken as a whole, would not be materially impaired;
(t) additional Investments so long as at the time of any such Investment and after giving effect thereto, (A) on a Pro Forma Basis, the Senior Secured Net Leverage Ratio is no greater than 7.00 to 1.00 for the most recently ended Test Period and (B) no Event of Default exists or would result therefrom;
(u) Investments consisting of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference to this Section 6.04(t5.04(v)) under Sections 6.015.01, 6.025.02, 6.035.03, 6.05 5.05 and 6.085.07, respectively;
(u) additional Investments; provided that after giving effect to such Investment (A) on a Pro Forma Basis, the Total Net Leverage Ratio is less than or equal to 4.50 to 1.00 and (B) there is no continuing Event of Default;
(v) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the BorrowerIssuer;
(w) to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Property, or other rights, in each case in the ordinary course of business;
(x) any Investment in any Subsidiary or any joint venture in connection with intercompany cash management arrangements or related activities arising in the ordinary course of business;
(y) Investments by an Unrestricted Subsidiary entered into prior to the day such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to the definition of “Unrestricted Subsidiary”;
(yz) Investments consisting in or relating to a Securitization Subsidiary that, in the good faith determination of purchases of assets of Franchisees (the Issuer are necessary or advisable to effect any Qualified Securitization Facility or any repurchase obligation in connection therewith, including, but not limited towithout limitation, area development contracts owned Investments of funds held in accounts permitted or required by Franchiseesthe arrangements governing such Qualified Securitization Facilities or any related Indebtedness; and
(aa) Investments in the ordinary course of business or otherwise in an amount not exceeding $60,000,000, so long as (A) no Event of Default shall have occurred and be continuing and (B) the Borrower is in pro forma compliance with the Financial Covenant after giving effect to any such purchase;
(z) So long as no Event of Default shall have occurred and be continuing, Investments in Franchisees (including, but not limited to, (i) Guarantees or other credit support of any Indebtedness and other liabilities thereof and (ii) loans, advances or contributions to the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater of $20,000,000 and 70% of Consolidated EBITDA;
(aa) Investments consisting of accounts and payment intangibles owing to the Borrower or any of the Restricted Subsidiaries from Franchisees; provided that such obligation shall be on such terms as the Borrower or the applicable Restricted Subsidiary establishes in good faith; and
(bb) Investments consisting of advances or expenditures by any Loan Party to, or on behalf of, any CMF Subsidiary in support of advertising and marketing programs in the ordinary course consistent with current practices. For purposes of determining compliance with this Section 6.04, in the event that any item of Investment meets the criteria of more than one of the categories of Investments described in clauses (a) through (bb) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such Investment (or any portion thereof) and will only be required to include the amount and type of such Investment in one or more of the above clausesSettlements.
Appears in 1 contract
Samples: Indenture (Sotera Health Co)
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor the The Borrower willwill not, nor will they it permit any Restricted Subsidiary or Intermediate Parent to, make or hold any Investment, except:
(a) Permitted Investments at the time such Permitted Investment is made;
(b) loans or advances to present or former officers, directors directors, managers, members of management, consultants, independent contractors and employees of Holdings, any Intermediate Parent, the Borrower and the Restricted Subsidiaries (i) for reasonable and customary business-related travel, entertainment, relocation and analogous ordinary business purposes, (ii) in connection with such Person’s purchase of Equity Interests in Holdings (or any direct or indirect parent thereof) the Borrower (provided that the amount of such loans and advances made in cash to such Person shall be contributed to the Borrower in cash as common equity or Qualified Equity Interests) and (iii) for purposes not described in the foregoing clauses (i) and (ii); provided that at the time of incurrence thereof and after giving Pro Forma Effect pro forma effect thereto, the aggregate principal amount outstanding in reliance on this clause (iii) shall not exceed $1,000,0005,000,000;
(c) Investments (i) by Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary in any Loan Party; provided that to the extent the aggregate amount of HoldingsInvestments by a Restricted Subsidiary that is not a Loan Party in a Loan Party exceeds $1,000,000, such non-Loan Party Restricted Subsidiary shall have acceded to the Pari Passu Intercreditor Agreement pursuant to the terms thereof, (ii) by any Intermediate ParentRestricted Subsidiary that is not a Loan Party in any other Restricted Subsidiary that is also not a Loan Party, (iii) subject to the proviso in clause (c)(i) of this Section 6.04, by the Borrower or any Restricted Subsidiary (A) in any Restricted Subsidiary; provided that (x) the aggregate outstanding amount of such Investments made by Loan Parties after the Effective Date in Restricted Subsidiaries that are not Loan Parties in reliance on this clause (iii)(A), together with the aggregate amount of (x) all other Investments made in and Dispositions made to Restricted Subsidiaries that are not Loan Parties by any Loan Parties after the Effective Date and (y) all Investments and Dispositions made in reliance on Section 6.16(ii), shall not exceed, at the time of the making thereof and after giving pro forma effect thereto, $7,500,000, (y) no Event of Default has occurred and is continuing and (z) all Investments made by Loan Parties in Restricted Subsidiaries that are not Loan Parties in reliance on this clause (ciii)(A) shall be made only for the purpose of financing working capital needs of such non Loan Parties or another purpose agreed to by the Required Lenders (such consent not exceed to be unreasonably withheld, conditioned or delayed; provided, that it is acknowledged and agreed that it shall not be unreasonable to withhold consent to any such transaction that will have a material adverse impact on the greater Guarantees or the Collateral) and shall be evidenced by an intercompany note that has been pledged as Collateral, (B) [reserved] or (C) constituting Guarantees of $10,000,000 Indebtedness or other monetary obligations of Restricted Subsidiaries that are not Loan Parties owing to any Loan Party, (iv) by the Borrower or any Restricted Subsidiary in Restricted Subsidiaries that are not Loan Parties so long as such transaction is part of a series of simultaneous transactions that results in the proceeds of the initial Investment being invested in one or more Loan Parties, (v) subject to the consent of the Required Lenders (such consent not to be unreasonably withheld, conditioned or delayed; provided, that it is acknowledged and 35% agreed that it shall not be unreasonable to withhold consent to any such transaction that will have a material adverse impact on the Guarantees or the Collateral), by the Borrower or any Restricted Subsidiary in any Restricted Subsidiary that is not a Loan Party, consisting of Consolidated EBITDAthe contribution of Equity Interests of any other Restricted Subsidiary that is not a Loan Party so long as the Equity Interests of the transferee Restricted Subsidiary is pledged to secure the Secured Obligations;
(d) Investments consisting of deposits, prepayments and/or other credits to suppliers in the ordinary course of business;
(e) Investments consisting of extensions of trade credit in the ordinary course of business;
(f) Investments (i) existing or contemplated on the date hereof and set forth on Schedule 6.04(f) and any modification, replacement, renewal, reinvestment or extension thereof and (ii) Investments existing on the date hereof Effective Date by Holdings, the Borrower or any Restricted Subsidiary in the Borrower or any Restricted Subsidiary and any modification, renewal or extension thereof; provided that the amount of the original Investment is not increased except by the terms of such Investment to the extent as set forth on Schedule 6.04(f) or as otherwise permitted by this Section 6.04;
(g) Investments in Swap Agreements permitted under Section 6.01(a)(vi)6.01;
(h) promissory notes and other non-cash consideration received in connection with Dispositions permitted by Section 6.05;
(i) Permitted AcquisitionsInvestments made in connection with the Transactions (other than borrowings under the ABL Credit Agreement);
(j) subject to the Transactionsconsent of the Required Lenders (such consent not to be unreasonably withheld, conditioned or delayed; provided, that it is acknowledged and agreed that it shall not be unreasonable to withhold consent to any such transaction that will have a material adverse impact on the Guarantees or the Collateral), Investments made by any Loan Party in any non-Loan Party consisting of contributions or other Dispositions of Equity Interests of Persons that are non-Loan Parties; provided that, prior to such contribution or Disposition, such Equity Interests were not owned directly by a Loan Party or such Equity Interests are contributed or disposed to a Non-Loan Party that is a wholly owned Restricted Subsidiary of a Loan Party;
(k) Investments in the ordinary course of business consisting of endorsements for collection or deposit and customary trade arrangements with customers consistent with past practices;
(l) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers and customers, from financially troubled account debtors or in settlement of delinquent obligations of, or other disputes with, customers and suppliers or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment;
(m) loans subject to the consent of the Required Lenders (such consent not to be unreasonably withheld, conditioned or delayed; provided, that it is acknowledged and advances agreed that it shall not be unreasonable to Holdings withhold consent to any such transaction that will have a material adverse impact on the Guarantees or the Collateral), cash or property distributed from any Restricted Subsidiary that is not a Loan Party (or any direct or indirect parent thereofi) or any Intermediate Parent in lieu ofmay be contributed to other Restricted Subsidiaries that are not Loan Parties, and (ii) may pass through the Borrower and/or any intermediate Restricted Subsidiaries, so long as part of a series of related transactions and such transaction steps are not in excess of the amount of (after giving effect to any other loans, advances or Restricted Payments in respect thereof), Restricted Payments to the extent unreasonably delayed and are otherwise permitted to be made to Holdings (or such parent) or such Intermediate Parent in accordance with Section 6.08(a)hereunder;
(n) from and after the Second Additional Funding Date, additional Investments and other acquisitionsacquisitions made and held by the Loan Parties; provided that at the time any such Investment or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition made in reliance on this clause (n), together with (including the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (n)), whether in the form of Indebtedness assumed or otherwise), shall not exceed the sum of (A) the greater of $18,000,000 and 60% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Investment or other acquisition, plus (B) so long as no Event of Default has occurred and is continuing, the Available Amount that is Not Otherwise Applied as in effect immediately prior to at the time of making incurrence thereof and after giving pro forma effect thereto, $2,500,000; provided that (x) the aggregate amount of such InvestmentInvestments made by Loan Parties after the Effective Date in Restricted Subsidiaries that are not Loan Parties in reliance on this clause (n), together with the aggregate amount of (x) all other Investments made in and Dispositions made to Restricted Subsidiaries that are not Loan Parties by Loan Parties after the Effective Date and (y) all Investments and Dispositions made in reliance on Section 6.16(ii), shall not exceed, at the time of the making thereof and after giving pro forma effect thereto, $7,500,000 at any time outstanding and (y) all Investments made by Loan Parties in Restricted Subsidiaries that are not Loan Parties in reliance on this clause (n) shall be made only for the purpose of financing working capital needs of such non Loan Parties or another purpose agreed to by the Required Lenders (such consent not to be unreasonably withheld, conditioned or delayed; provided, that it is acknowledged and agreed that it shall not be unreasonable to withhold consent to any such transaction that will have a material adverse impact on the Guarantees or the Collateral) and shall be evidenced by an intercompany note that has been pledged as Collateral;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby[reserved];
(p) advances of payroll payments to employees in the ordinary course of business;
(q) Investments and other acquisitions to the extent that payment for such Investments is made with Qualified Equity Interests (excluding Cure Amounts) of Holdings (or any direct or indirect parent thereof or the IPO Entity)Borrower; provided that (i) such amounts used pursuant to this clause (q) shall not increase the Available Amount and (ii) any other amounts used for such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof or the IPO Entity) Borrower shall otherwise be permitted pursuant to this Section 6.04;
(r) Investments of a Subsidiary acquired after the Effective Date or of a Person merged or consolidated with any Subsidiary in accordance with this Section and Section 6.03 after the Effective Date to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger or consolidation and were in existence on the date of such acquisition, merger or consolidation[reserved];
(s) non-cash Investments in connection with tax planning and reorganization activities; provided that after giving effect to any such activities, the security interests of the Lenders in the Collateral, taken as a whole, would not be materially impaired[reserved];
(t) Investments consisting of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference to this Section 6.04(t)) under Sections 6.01, 6.02, 6.03, 6.05 and 6.08, respectively;
(u) additional Investments; provided that after giving effect to such Investment (A) on a Pro Forma Basis, the Total Net Leverage Ratio is less than or equal to 4.50 to 1.00 and (B) there is no continuing Event of Default[reserved];
(v) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers of the Borrower or any Restricted Subsidiary or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the Borrower;
(w) to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Property, or other rights, in each case in the ordinary course of business;
(x) Investments by an Unrestricted Subsidiary entered into prior to the day such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to the definition of “Unrestricted Subsidiary”[reserved];
(y) Investments consisting of purchases of assets of Franchisees (including, but not limited to, area development contracts owned by Franchisees) in the ordinary course of business or otherwise in an amount not exceeding $60,000,000, so long as (A) no Event of Default shall have occurred and be continuing and (B) the Borrower is in pro forma compliance with the Financial Covenant after giving effect to any such purchase[reserved];
(z) So long as no Event of Default shall have occurred and be continuing, Investments in Franchisees (including, but not limited to, (i) Guarantees or other credit support of any Indebtedness and other liabilities thereof and (ii) loans, advances or contributions to the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater of $20,000,000 and 70% of Consolidated EBITDA[reserved];
(aa) Investments consisting of accounts and payment intangibles owing to the Borrower or any of the Restricted Subsidiaries from Franchisees; provided that such obligation shall be on such terms as the Borrower or the applicable Restricted Subsidiary establishes in good faith[reserved]; and
(bb) Investments consisting unfunded pension fund and other employee benefit plan obligations and liabilities to the extent that the same are permitted to remain unfunded under applicable Requirements of advances or expenditures by any Loan Party to, or on behalf of, any CMF Subsidiary in support of advertising and marketing programs in the ordinary course consistent with current practices. For purposes of determining compliance with this Section 6.04, in the event that any item of Investment meets the criteria of more than one of the categories of Investments described in clauses (a) through (bb) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such Investment (or any portion thereof) and will only be required to include the amount and type of such Investment in one or more of the above clausesLaw.
Appears in 1 contract
Samples: Credit Agreement (Invacare Corp)
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor the (a) The Borrower willshall not, nor will they shall it permit any Restricted Subsidiary or Intermediate Parent of its Subsidiaries to, make or hold permit to remain outstanding any Investment, except:
(a) Permitted Investments at the time such Permitted Investment is made;
(b) loans or advances to officers, directors and employees of Holdings, any Intermediate Parent, the Borrower and the Restricted Subsidiaries except (i) for reasonable Investments outstanding on the date hereof and customary business-related travel, entertainment, relocation and analogous ordinary business purposesidentified in Part B of Schedule 3.06, (ii) in connection operating deposit accounts with such Person’s purchase of Equity Interests in Holdings (or any direct or indirect parent thereof) (provided that the amount of such loans and advances made in cash to such Person shall be contributed to the Borrower in cash as common equity or Qualified Equity Interests) and banks, (iii) for purposes not described securities accounts so long as the securities entitlements thereunder are in respect of Investments that otherwise conform to the foregoing clauses requirements of this Section 6.04 and trust accounts so long as the Investments held therein otherwise conform to the requirements of this Section 6.04, (iiv) and Permitted Investments, (ii); provided that at the time of incurrence thereof and after giving Pro Forma Effect thereto, the aggregate principal amount outstanding in reliance on this clause (iii) shall not exceed $1,000,000;
(cv) Investments by Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary and its Subsidiaries in any of Holdingstheir respective Subsidiaries, any Intermediate Parent, the Borrower or any Restricted Subsidiary; provided that the aggregate outstanding Dollar-equivalent amount of all Investments made by Loan Parties of the Borrower and its Domestic Subsidiaries in Restricted Foreign Subsidiaries that are not Loan Parties in reliance on this clause (c) shall not exceed $25,000,000 at any time, (vi) Hedging Agreements entered into for the greater purpose of $10,000,000 and 35% of Consolidated EBITDA;
(d) Investments consisting of prepayments hedging or mitigating risks to suppliers in the ordinary course of business;
(e) Investments consisting of extensions of trade credit in the ordinary course of business;
(f) Investments (i) existing or contemplated on the date hereof and set forth on Schedule 6.04(f) and any modification, replacement, renewal, reinvestment or extension thereof and (ii) Investments existing on the date hereof by Holdings, which the Borrower or any Restricted such Subsidiary is exposed in the conduct of its business or the management of its liabilities and, when considered in light of other outstanding Hedging Agreements to which the Borrower or any Restricted a Subsidiary and any modificationis party, renewal (A) does not expose the Borrower or extension thereof; provided that such Subsidiaries, as the case may be, to predominantly speculative risks unrelated to the amount of assets, Debt or other liabilities intended to be subject to coverage on a notional basis under such Hedging Agreements and (B) qualifies for hedge accounting under GAAP, including Statement No. 133 of the original Investment is not increased except by the terms of such Investment to the extent as set forth on Schedule 6.04(f) or as otherwise permitted by this Section 6.04;
Financial Accounting Standards Board, and (g) Investments in Swap Agreements permitted under Section 6.01(a)(vi);
(h) promissory notes and other non-cash consideration received in connection with Dispositions permitted by Section 6.05;
(ivii) Permitted Acquisitions;.
(jb) the Transactions;
(k) Investments in the ordinary course of business consisting of endorsements for collection or deposit and customary trade arrangements with customers consistent with past practices;
(l) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers and customers, from financially troubled account debtors or in settlement of delinquent obligations of, or other disputes with, customers and suppliers or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment;
(m) loans and advances to Holdings (or any direct or indirect parent thereof) or any Intermediate Parent in lieu of, and not in excess of the amount of (after giving effect to any other loans, advances or Restricted Payments in respect thereof), Restricted Payments to the extent permitted to be made to Holdings (or such parent) or such Intermediate Parent in accordance with Section 6.08(a);
(n) additional Investments and other acquisitions; provided that at the time any such Investment or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition made in reliance on this clause (n), together with the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (n), The Borrower shall not exceed the sum of (A) the greater of $18,000,000 and 60% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect permit any Insurance Company to the making of such make any Investment or other acquisitionif, plus (B) so long as no Event of Default has occurred and is continuing, the Available Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of such Investment;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby;
(p) advances of payroll payments to employees in the ordinary course of business;
(q) Investments and other acquisitions to the extent that payment for such Investments is made with Qualified Equity Interests (excluding Cure Amounts) of Holdings (or any direct or indirect parent thereof or the IPO Entity); provided that (i) such amounts used pursuant to this clause (q) shall not increase the Available Amount and (ii) any amounts used for such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof or the IPO Entity) shall otherwise be permitted pursuant to this Section 6.04;
(r) Investments of a Subsidiary acquired after the Effective Date or of a Person merged or consolidated with any Subsidiary in accordance with this Section and Section 6.03 after the Effective Date to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger or consolidation and were in existence on the date of which such acquisition, merger or consolidation;
(s) non-cash Investments in connection with tax planning Investment is made and reorganization activities; provided that after giving effect to any such activitiesthereto, the security interests aggregate value of the Lenders in the Collateral, taken as a whole, would not be materially impaired;
(t) Investments consisting of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than equity Investments) held by reference to this Section 6.04(t)) under Sections 6.01, 6.02, 6.03, 6.05 such Insurance Company and 6.08, respectively;
(u) additional Investments; provided all of the other Insurance Companies taken together that after giving effect to such Investment (A) on a Pro Forma Basis, are rated lower than “2” by the Total Net Leverage Ratio is less than NAIC or equal to 4.50 to 1.00 and (B) there is no continuing Event are not rated by the NAIC would exceed 15.0% of Default;
(v) contributions to a “rabbi” trust for the benefit value of employees, directors, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the Borrower;
(w) to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Property, or other rights, in each case in the ordinary course of business;
(x) Investments by an Unrestricted Subsidiary entered into prior to the day such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to the definition of “Unrestricted Subsidiary”;
(y) Investments consisting of purchases of total invested assets of Franchisees (including, but not limited to, area development contracts owned by Franchisees) in the ordinary course of business or otherwise in an amount not exceeding $60,000,000, so long as (A) no Event of Default shall have occurred and be continuing and (B) the Borrower is in pro forma compliance with the Financial Covenant after giving effect to any such purchase;
(z) So long as no Event of Default shall have occurred and be continuing, Investments in Franchisees (including, but not limited to, (i) Guarantees or other credit support of any Indebtedness and other liabilities thereof and (ii) loans, advances or contributions to the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater of $20,000,000 and 70% of Consolidated EBITDA;
(aa) Investments consisting of accounts and payment intangibles owing to the Borrower or any all of the Restricted Subsidiaries from Franchisees; provided that such obligation shall be on such terms as the Borrower or the applicable Restricted Subsidiary establishes Insurance Companies. As used in good faith; and
(bb) Investments consisting of advances or expenditures by any Loan Party to, or on behalf of, any CMF Subsidiary in support of advertising and marketing programs in the ordinary course consistent with current practices. For purposes of determining compliance with this Section 6.04, in the event that any item “value” of an Investment meets refers to the criteria of more than one of the categories of Investments described in clauses (a) through (bb) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such Investment (or any portion thereof) and will only be required to include the amount and type value of such Investment in one or more that would be shown on the most recent Statutory Statement of the above clausesrelevant Insurance Company prepared in accordance with SAP.
Appears in 1 contract
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor the The Borrower willwill not, nor and will they not permit any Restricted Subsidiary or Intermediate Parent to, make or hold any Investment, except:
(a) Permitted Investments at the time such Permitted Investment is madeInvestments;
(b) loans or advances to officers, directors and employees of CWH, Holdings, any Intermediate Parent, the Borrower and the Restricted its Subsidiaries (i) for reasonable and customary business-related travel, entertainment, relocation and analogous ordinary business purposes, (ii) in connection with such Person’s purchase of Equity Interests in of Holdings (or any direct or indirect parent thereof) (provided that the amount of such loans and advances made in cash to such Person shall be contributed to the Borrower in cash as common equity or Qualified Equity Interests) ), and (iii) for purposes not described in the foregoing clauses (i) and (ii); , provided that at the time of incurrence thereof and after giving Pro Forma Effect thereto, the aggregate principal amount outstanding in reliance on at any time under this clause (iiib) shall not to exceed the greater of (x) $1,000,00010,000,000 and (y) 3.5% of Consolidated EBITDA for the most recently ended Test Period;
(c) Investments (i) by Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary in any of HoldingsLoan Party (excluding any new Subsidiary that becomes a Loan Party pursuant to such Investment), (ii) by any Intermediate ParentSubsidiary that is not a Loan Party in any other Subsidiary that is also not a Loan Party, (iii) by the Borrower or any Restricted Subsidiary (A) in any Subsidiary; provided that the aggregate outstanding amount of (1)such Investments made by Loan Parties after the Effective Date in Restricted Subsidiaries that are not Loan Parties in reliance on this clause (ciii)(A) and (2)consideration paid or provided by the Borrower or any other Loan Party after the Effective Date in reliance on Section 6.04(h) or Section 6.04(m) for acquisitions (including the aggregate principal amount of all Indebtedness assumed in connection with acquisitions) of Subsidiaries that shall not be or, after giving effect to such acquisitions, shall not become Loan Parties, or for assets that, after giving effect to such acquisitions, shall not be owned by Loan Parties, shall not exceed the greater Non-Loan Party Investment Amount at the time of $10,000,000 any such Investment, (B) in any Subsidiary that is not a Loan Party, constituting an exchange of Equity Interests of such Subsidiary for Indebtedness of such Subsidiary or (C) constituting Guarantees of Indebtedness or other monetary obligations of Subsidiaries that are not Loan Parties owing to any Loan Party, (iv) by the Borrower or any Subsidiary in Subsidiaries that are not Loan Parties so long as such Investment is part of a series of simultaneous Investments that result in the proceeds of the initial Investment being invested in one or more Loan Parties and 35% (v) by the Borrower or any Subsidiary in any Subsidiary that is not a Loan Party, consisting of Consolidated EBITDAthe contribution of Equity Interests of any other Subsidiary that is not a Loan Party so long as the Equity Interests of the transferee Subsidiary are pledged to secure the Secured Obligations;
(d) Investments consisting of prepayments to suppliers extensions of trade credit and accommodation guarantees in the ordinary course of business;
(e) Investments consisting of extensions of trade credit in the ordinary course of business;
(f) Investments (i) existing or contemplated on the date hereof Effective Date and set forth on Schedule 6.04(f6.04(e) and any modification, replacement, renewal, reinvestment or extension thereof and (ii) Investments existing on the date hereof Effective Date by Holdings, the Borrower or any Restricted Subsidiary in the Borrower or any Restricted Subsidiary and any modification, renewal or extension thereof; provided that the amount of the original Investment is not increased except by the terms of such Investment to the extent as set forth on Schedule 6.04(f6.04(e) or as otherwise permitted by this Section 6.04;
(gf) Investments in Swap Agreements permitted under Section 6.01(a)(vi)incurred in the ordinary course of business and not for speculative purposes;
(hg) promissory notes and other non-cash consideration received in connection with Dispositions permitted by Section 6.05;
(h) Permitted Acquisitions; provided that the sum of (i) Permitted the aggregate amount of consideration paid or provided by the Borrower or any other Loan Party after the Effective Date in reliance on this Section 6.04(h) or Section 6.04(m) for acquisitions (including the aggregate principal amount of all Indebtedness assumed in connection with acquisitions) of Subsidiaries that shall not be or, after giving effect to such acquisitions, shall not become Loan Parties, or for any assets that, after giving effect to such acquisitions, shall not be owned by Loan Parties and (ii) any Investments made in Subsidiaries that are not Loan Parties pursuant to Section 6.04(c)(iii)(A), shall not exceed the Non-Loan Party Investment Amount at such time;
(i) Investments by Loan Parties in FreedomRoads Entities in an aggregate amount not greater than the greater of (x) $50,000,000 and (y) 18.0% of Consolidated EBITDA for the most recently ended Test Period to finance RV Dealership Acquisitions;
(j) the Transactions;
(k) Investments in the ordinary course of business consisting of Uniform Commercial Code Article 3 endorsements for collection or deposit and Uniform Commercial Code Article 4 customary trade arrangements with customers consistent with past practices;
(lk) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers and customers, from financially troubled account debtors customers or in settlement of delinquent obligations of, or other disputes with, customers and suppliers or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment;
(ml) loans and advances to Holdings (or any direct or indirect parent thereof) or any Intermediate Parent in lieu of, and not in excess of the amount of (after giving effect to any other loans, advances or Restricted Payments in respect thereof), ) Restricted Payments to the extent permitted to be made to Holdings (or such parent) or such Intermediate Parent in accordance with Section 6.08(a6.07(a)(iii), (iv), (v) or (vi) (and the amounts of Restricted Payments permitted under such provisions in Section 6.07 shall be reduced by the amounts of any such loans or advances);
(nm) additional so long as immediately after giving effect to any such Investment no Event of Default has occurred and is continuing, other Investments (other than, in the case of Investments of the type referred to in clauses (a) and (b) of the definition thereof, in or for the benefit of any direct or indirect owner of Equity Interests in the Borrower) and other acquisitions; provided that at the time any such Investment or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition all Investments made in reliance on this clause (nm), together with the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (nm) (including the aggregate principal amount of all Indebtedness assumed in connection with any such other acquisition), shall not exceed the sum of (Ai) the greater of (x) $18,000,000 50,000,000 and 60(y) 18.0% of Consolidated EBITDA for the most recently ended Test Period and (ii) the Available Amount; provided further, that the aggregate amount of consideration paid or provided (including the aggregate principal amount of all Indebtedness assumed) by the Borrower or any other Loan Party after the Effective Date in reliance on this Section 6.04(m) or Section 6.04(h) for Investments in and acquisitions of Subsidiaries that shall not be or, after giving Pro Forma Effect effect to such acquisitions, shall not become Loan Parties, or for any assets that shall not be owned by Loan Parties, together with the making aggregate amount of any Investments made in Subsidiaries that are not Loan Parties pursuant to Section 6.04(c)(iii)(A), shall not exceed the Non-Loan Party Investment Amount at such Investment or other acquisition, plus (B) so long as no Event of Default has occurred and is continuing, the Available Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of such Investmenttime;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby;
(pn) advances of payroll payments to employees in the ordinary course of business;
(qo) Investments and other acquisitions to the extent that payment for such Investments is made with Qualified Equity Interests (excluding Cure Amounts) of Holdings (or any direct or indirect parent thereof or the IPO Entity); provided that (i) such amounts used pursuant to this clause (q) shall not increase the Available Amount and (ii) any amounts used for such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof or the IPO Entity) shall otherwise be permitted pursuant to this Section 6.04by FreedomRoads Entities;
(rp) Investments of a Subsidiary acquired after the Effective Date or of a Person merged or consolidated with any Subsidiary in accordance with this Section and Section 6.03 after the Effective Date or that otherwise becomes a Subsidiary (provided that if such Investment is made under Section 6.04(h), existing Investments in subsidiaries of such Subsidiary or Person shall comply with the requirements of Section 6.04(h) or 6.04(m) or any other paragraph of this Section 6.04) to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger or consolidation and were in existence on the date of such acquisition, merger or consolidation;
(sq) non-cash Investments in connection with tax planning and reorganization activities; provided that after giving effect to any such activities, the security interests of the Lenders in the Collateral, taken as a whole, would not be materially impaired;
(t) Investments consisting of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference to this Section 6.04(t)) under Sections 6.01, 6.02, 6.03, 6.05 and 6.08, respectively;
(u) additional Investments; provided that after giving effect to such Investment (A) on a Pro Forma Basis, the Total Net Leverage Ratio is less than or equal to 4.50 to 1.00 and (B) there is no continuing Event of Default;
(v) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the Borrower;
(w) receivables owing to the extent that they constitute InvestmentsBorrower or any Subsidiary, purchases and acquisitions of inventory, supplies, materials if created or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Property, or other rights, in each case acquired in the ordinary course of business;; and
(xr) Investments by an Unrestricted Subsidiary entered into prior to the day such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to the definition of “Unrestricted Subsidiary”;
for (yA) Investments consisting of purchases of assets of Franchisees (includingutilities, but not limited tosecurity deposits, area development contracts owned by Franchisees) leases and similar prepaid expenses incurred in the ordinary course of business or otherwise in an amount not exceeding $60,000,000, so long as (A) no Event of Default shall have occurred and be continuing and (B) the Borrower is in pro forma compliance with the Financial Covenant after giving effect to any such purchase;
(z) So long as no Event of Default shall have occurred and be continuing, Investments in Franchisees (including, but not limited to, (i) Guarantees or other credit support of any Indebtedness and other liabilities thereof and (ii) loans, advances or contributions to the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater of $20,000,000 and 70% of Consolidated EBITDA;
(aa) Investments consisting of trade accounts and payment intangibles owing to the Borrower or any of the Restricted Subsidiaries from Franchisees; provided that such obligation shall be on such terms as the Borrower or the applicable Restricted Subsidiary establishes in good faith; and
(bb) Investments consisting of advances or expenditures by any Loan Party tocreated, or on behalf ofprepaid expenses accrued, any CMF Subsidiary in support of advertising and marketing programs in the ordinary course consistent with current practices. For purposes of determining compliance with this Section 6.04, in the event that any item of Investment meets the criteria of more than one of the categories of Investments described in clauses (a) through (bb) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such Investment (or any portion thereof) and will only be required to include the amount and type of such Investment in one or more of the above clausesbusiness.
Appears in 1 contract
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor and the Borrower willBorrowers will not, nor and will they not permit any of the other Restricted Subsidiary or Intermediate Parent to, Subsidiaries to make or hold permit to exist any InvestmentInvestment in any other Person, or purchase or otherwise acquire (in one 80 transaction or a series of transactions) any assets of any other Person constituting a business unit, except:
(a) Permitted Investments at the time such Permitted Investment is madeInvestments;
(b) loans or advances to officers, directors and employees of Holdings, any Intermediate Parent, the Borrower and the Restricted Subsidiaries (i) for reasonable and customary business-related travel, entertainment, relocation and analogous ordinary business purposes, (ii) in connection with such Person’s purchase of Equity Interests in Holdings (or any direct or indirect parent thereof) (provided that the amount of such loans and advances made in cash to such Person shall be contributed to the Borrower in cash as common equity or Qualified Equity Interests) and (iii) for purposes not described in the foregoing clauses (i) and (ii); provided that at the time of incurrence thereof and after giving Pro Forma Effect thereto, the aggregate principal amount outstanding in reliance on this clause (iii) shall not exceed $1,000,000;
(c) Investments by Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary in any of Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary; provided that the aggregate outstanding amount of Investments made by Loan Parties in Restricted Subsidiaries that are not Loan Parties in reliance on this clause (c) shall not exceed the greater of $10,000,000 and 35% of Consolidated EBITDA;
(d) Investments consisting of prepayments to suppliers in the ordinary course of business;
(e) Investments consisting of extensions of trade credit in the ordinary course of business;
(f) Investments (i) existing or contemplated on the date hereof and set forth on Schedule 6.04(f6.05;
(c) Investments by Holdings and the Restricted Subsidiaries in the Capital Stock or capital of Subsidiaries that are Loan Parties; provided that such shares of Capital Stock shall be pledged pursuant to the Pledge Agreement;
(d) loans or advances made by Holdings to any Subsidiary (other than any Foreign Subsidiary) and made by any modificationSubsidiary to Holdings or any other Subsidiary (other than any Foreign Subsidiary), replacement, renewal, reinvestment or extension thereof and Guarantees permitted by Section 6.01(v); provided that (i) such loans and advances shall be evidenced by a promissory note pledged pursuant to the Pledge Agreement and (ii) the aggregate amount of loans, advances or Guarantees made by Loan Parties to Subsidiaries that are not Loan Parties shall not exceed $10,000,000 at any one time outstanding;
(e) Permitted Business Acquisitions; provided that (A) such acquisitions are effected as stock acquisitions in which the consideration used to make such acquisitions consists of common stock of Holdings or Non-Cash Pay Preferred Stock of Holdings and (B) to the extent not effected in accordance with clause (A), the consideration for such Permitted Business Acquisitions is in an aggregate cumulative amount not at any time in excess of $10,000,000;
(f) Investments existing on the date hereof by Holdings, the Borrower Borrowers or any other Restricted Subsidiary in the Borrower or joint ventures, Foreign Subsidiaries and other Persons that are not Loan Parties, in an aggregate cumulative amount not at any Restricted Subsidiary and any modification, renewal or extension thereof; provided that the amount time in excess of the original Investment is not increased except by the terms of such Investment to the extent as set forth on Schedule 6.04(f) or as otherwise permitted by this Section 6.04$10,000,000;
(g) Investments in Swap Agreements permitted under Section 6.01(a)(vi);
(h) promissory notes and other non-cash consideration received in connection with Dispositions permitted by Section 6.05;
(i) Permitted Acquisitions;
(j) the Transactions;
(k) Investments in the ordinary course of business consisting of endorsements for collection or deposit and customary trade arrangements with customers consistent with past practices;
(l) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers and customersof, from financially troubled account debtors or in settlement of delinquent obligations of, or other accounts and disputes with, customers and suppliers or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment;
(m) loans and advances to Holdings (or any direct or indirect parent thereof) or any Intermediate Parent in lieu of, and not in excess of the amount of (after giving effect to any other loans, advances or Restricted Payments in respect thereof), Restricted Payments to the extent permitted to be made to Holdings (or such parent) or such Intermediate Parent in accordance with Section 6.08(a);
(n) additional Investments and other acquisitions; provided that at the time any such Investment or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition made in reliance on this clause (n), together with the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (n), shall not exceed the sum of (A) the greater of $18,000,000 and 60% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Investment or other acquisition, plus (B) so long as no Event of Default has occurred and is continuing, the Available Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of such Investment;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby;
(p) advances of payroll payments to employees in the ordinary course of business;
(q) Investments and other acquisitions to the extent that payment for such Investments is made with Qualified Equity Interests (excluding Cure Amounts) of Holdings (or any direct or indirect parent thereof or the IPO Entity); provided that (i) such amounts used pursuant to this clause (q) shall not increase the Available Amount and (ii) any amounts used for such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof or the IPO Entity) shall otherwise be permitted pursuant to this Section 6.04;
(r) Investments of a Subsidiary acquired after the Effective Date or of a Person merged or consolidated with any Subsidiary in accordance with this Section and Section 6.03 after the Effective Date to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger or consolidation and were in existence on the date of such acquisition, merger or consolidation;
(s) non-cash Investments in connection with tax planning and reorganization activities; provided that after giving effect to any such activities, the security interests of the Lenders in the Collateral, taken as a whole, would not be materially impaired;
(t) Investments consisting of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference to this Section 6.04(t)) under Sections 6.01, 6.02, 6.03, 6.05 and 6.08, respectively;
(u) additional Investments; provided that after giving effect to such Investment (A) on a Pro Forma Basis, the Total Net Leverage Ratio is less than or equal to 4.50 to 1.00 and (B) there is no continuing Event of Default;
(v) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the Borrower;
(w) to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Property, or other rightssuppliers, in each case in the ordinary course of business;
(x) Investments by an Unrestricted Subsidiary entered into prior to the day such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to the definition of “Unrestricted Subsidiary”;
(y) Investments consisting of purchases of assets of Franchisees (including, but not limited to, area development contracts owned by Franchisees) in the ordinary course of business or otherwise in an amount not exceeding $60,000,000, so long as (A) no Event of Default shall have occurred and be continuing and (B) the Borrower is in pro forma compliance with the Financial Covenant after giving effect to any such purchase;
(z) So long as no Event of Default shall have occurred and be continuing, Investments in Franchisees (including, but not limited to, (i) Guarantees or other credit support of any Indebtedness and other liabilities thereof and (ii) loans, advances or contributions to the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater of $20,000,000 and 70% of Consolidated EBITDA;
(aa) Investments consisting of accounts and payment intangibles owing to the Borrower or any of the Restricted Subsidiaries from Franchisees; provided that such obligation shall be on such terms as the Borrower or the applicable Restricted Subsidiary establishes in good faith; and
(bbh) Investments consisting received as a result of advances or expenditures by any Loan Party to, or on behalf of, any CMF Subsidiary in support of advertising and marketing programs in the ordinary course consistent with current practices. For purposes of determining compliance with asset sales permitted under this Section 6.04, in the event that any item of Investment meets the criteria of more than one of the categories of Investments described in clauses (a) through (bb) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such Investment (or any portion thereof) and will only be required to include the amount and type of such Investment in one or more of the above clausesAgreement.
Appears in 1 contract
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor the The Borrower willwill not, nor and will they not permit any Restricted Subsidiary or Intermediate Parent to, make or hold any Investment, except:
(a) Permitted Investments at the time such Permitted Investment is mademade and purchases of assets in the ordinary course of business consistent with past practice;
(b) loans or advances to officers, directors members of the Board of Directors and employees of Holdings, any Intermediate Parent, the Borrower and the Restricted Subsidiaries (i) for reasonable and customary business-related travel, entertainment, relocation and analogous ordinary business purposes, (ii) in connection with such Person’s purchase of Equity Interests in of Holdings (or any direct or indirect parent thereof) (provided that the amount of such loans and advances made in cash to such Person shall be contributed to the Borrower in cash as common equity or Qualified Equity Interests) and (iii) for purposes not described in the foregoing clauses (i) and (ii); provided that at the time of incurrence thereof and after giving Pro Forma Effect thereto, the in an aggregate principal amount outstanding in reliance on this clause (iii) shall at any time not to exceed $1,000,00015,000,000;
(c) Investments by Holdings, the Borrower in any Intermediate Parent, Restricted Subsidiary and Investments by any Restricted Subsidiary in the Borrower or any Restricted Subsidiary in any of Holdings, any Intermediate Parent, the Borrower or any other Restricted Subsidiary; provided that any Investment by the aggregate outstanding amount of Investments made by Borrower or any Loan Parties Guarantors (excluding Holdings) in any non-Loan Party Restricted Subsidiaries that are not Loan Parties in reliance on Subsidiary pursuant to this clause (c) shall only be permitted to the extent existing on the Effective Date and set forth on Schedule 6.04; provided further that if any Investment pursuant to Section 6.04(bb) is made in any Person that is an Unrestricted Subsidiary or other non-Loan Party Subsidiary (including any Restricted Subsidiary that is not exceed a Loan Guarantor after the greater Effective Date) at the date of $10,000,000 the making of such Investment and 35% of Consolidated EBITDAsuch Person becomes a Loan Guarantor after such date, such Investment will thereafter be deemed to have been made pursuant to this Section 6.04(c) to the extent permitted hereunder and will cease to have been made pursuant to Section 6.04(bb) for so long as such Person continues to be a Loan Guarantor;
(d) Investments (other than guarantees of Indebtedness) consisting of prepayments to suppliers extensions of trade credit and guarantees in the ordinary course of business;
(e) Other than with respect to Investments consisting of extensions of trade credit in the ordinary course of business;
(f) any non-Loan Party Restricted Subsidiary, Investments (i) existing or contemplated on the date hereof Effective Date and set forth on Schedule 6.04(f) 6.04 and any modification, replacement, renewal, reinvestment or extension thereof and (ii) Investments existing on the date hereof Effective Date by Holdings, the Borrower or any Restricted Subsidiary in Holdings, the Borrower or any Restricted Subsidiary and any modification, renewal or extension thereof; provided that the amount of the original Investment is not increased except by the terms of such Investment to the extent as set forth on Schedule 6.04(f) 6.04 or as otherwise permitted by this Section 6.04;
(gf) Investments in Swap Agreements permitted under Section 6.01(a)(vi)incurred in the ordinary course of business and not for speculative purposes;
(hg) promissory notes and other non-cash consideration received in connection with Dispositions permitted by Section 6.05;
(ih) Permitted Acquisitions and Investments in any Restricted Subsidiary necessary to consummate Permitted Acquisitions;
(ji) the Transactions;
(kj) Investments in the ordinary course of business consisting of Uniform Commercial Code Article 3 endorsements for collection or deposit and Uniform Commercial Code Article 4 customary trade arrangements with customers consistent with past practicesin the ordinary course of business;
(lk) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers and customers, from financially troubled account debtors customers or in settlement of delinquent obligations of, or other disputes with, customers and suppliers or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment;
(ml) loans and advances to Holdings (or any direct or indirect parent thereofof the Borrower (x) or any Intermediate Parent in lieu of, and not in excess of the amount of (after giving effect to any other loans, advances or Restricted Payments in respect thereof), Restricted Payments to the extent permitted to be made to Holdings (or such parent) direct or such Intermediate Parent indirect parent of the Borrower in accordance with Section 6.08(a6.07(a) (other than Section 6.07(a)(xvii)(2)) and (y) to the extent the proceeds thereof are contributed or loaned or advanced to the Borrower or a Restricted Subsidiary;
(nm) additional Investments and other acquisitions; provided that at the time any such Investment or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition made in reliance on this clause (nm), together with the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (nm) (including the aggregate principal amount of all Indebtedness assumed in connection with any such other Investment or acquisition previously made under this clause (m)), shall not exceed the sum of (A) the greater of (i)(A) $18,000,000 70,000,000 and 60(B) 50.0% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Investment or other acquisition, plus (Bii) so long as no Event of Default has occurred and is continuing, the Available Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of such Investment, plus (iii) the Available Equity Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of such Investment; plus (iv) unused amounts available to make Investments pursuant to Section 6.04(bb) (it being understood that the usage for such amounts for Investments under this clause (m) shall reduce the amount available for Investments under such Section 6.04(bb)) plus (v) unused amounts available to make Restricted Payments pursuant to Section 6.07(a)(xvi) (it being understood that the usage for such amounts for Investments under this clause (m) shall reduce the amount available for Restricted Payments under such Section 6.07(a)(xvi)) plus (vi) unused amounts available to make prepayments, redemptions, repurchases, defeasances and other payments of Junior Financing pursuant to Section 6.07(b)(iv) (it being understood that the usage of such amounts for Investments under this clause (m) shall reduce the amounts available for prepayments, redemptions, repurchases, defeasances and other payments in respect of Junior Financing under such Section 6.07(b)(iv)); provided, to the extent such Investment or other acquisition is made in reliance on clause (ii) above, no Specified Event of Default shall have occurred and be continuing or would result therefrom (provided, that in the case of an Investment or other acquisition incurred to finance a Limited Condition Transaction, if the Borrower had made an LCT Election, such condition shall be that no Specified Event of Default shall have occurred and be continuing at the LCT Test Date) (this clause (m), the “General Investment Basket”);
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby;
(pn) advances of payroll payments payments, including wages, commissions, bonuses and other variable compensation to employees in the ordinary course of business;
(qo) Investments and other acquisitions to the extent that payment for such Investments is made with Qualified Equity Interests (excluding Qualified Equity Interests the proceeds of which will be applied as Cure Amounts) of Holdings (Holdings, the Borrower or any direct or indirect parent thereof or of the IPO Entity); provided that (i) such amounts used pursuant to this clause (q) shall not increase the Available Amount and (ii) any amounts used for such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof or the IPO Entity) shall otherwise be permitted pursuant to this Section 6.04Borrower;
(rp) Investments of a Restricted Subsidiary acquired after the Effective Date or of a Person merged merged, amalgamated or consolidated with any Subsidiary in accordance with this Section 6.04 and Section 6.03 after the Effective Date or that otherwise becomes a Restricted Subsidiary (provided that if such Investment is made under Section 6.04(h), existing Investments in subsidiaries of such Restricted Subsidiary or Person shall comply with the requirements of Section 6.04(h)) to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger merger, amalgamation or consolidation and were in existence on the date of such acquisition, merger merger, amalgamation or consolidation;
(q) receivables owing to the Borrower or any Restricted Subsidiary, if created or acquired in the ordinary course of business;
(r) Investments (A) for utilities, security deposits, leases and similar prepaid expenses incurred in the ordinary course of business and (B) trade accounts created, or prepaid expenses accrued, in the ordinary course of business;
(s) non-cash any Permitted Reorganization and any Investments in connection with tax planning and reorganization activities; provided that after giving effect to any such activities, the security interests of the Lenders in the Collateral, taken as a whole, would not be materially impairedtherewith;
(t) additional Investments so long as at the time of any such Investment and after giving effect thereto, on a Pro Forma Basis, the Total Net Leverage Ratio is no greater than 3.00 to 1.00;
(u) Investments consisting of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference to this Section 6.04(t6.04(u)) under Sections 6.01, 6.02, 6.03, 6.05 and 6.086.07, respectively;
(u) additional Investments; provided that after giving effect to such Investment (A) on a Pro Forma Basis, the Total Net Leverage Ratio is less than or equal to 4.50 to 1.00 and (B) there is no continuing Event of Default;
(v) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the Borrower;
(w) to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Property, or other rights, in each case in the ordinary course of business;
(x) any Investment in any Subsidiary or any joint venture in connection with intercompany cash management arrangements or related activities arising in the ordinary course of business;
(y) Investments made by an Unrestricted Subsidiary entered into (other than Investments made with the proceeds of Investments made in reliance on Section 6.04(bb)) prior to the day such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to the definition of “Unrestricted Subsidiary”;
(yz) Investments consisting in or relating to a Securitization Subsidiary or a Restricted Subsidiary that, in the good faith determination of purchases of assets of Franchisees (the Borrower are necessary or advisable to effect any Qualified Securitization Facility or any repurchase obligation in connection therewith, including, but not limited towithout limitation, area development contracts owned Investments of funds held in accounts permitted or required by Franchiseesthe arrangements governing such Qualified Securitization Facilities or any related Indebtedness;
(aa) Investments in the ordinary course of business or otherwise in connection with Settlements;
(i) Investments in any Unrestricted Subsidiaries, joint ventures and Persons which do not become Loan Parties as a result of such Investment (including Restricted Subsidiaries that are not Loan Guarantors) in an amount not exceeding $60,000,000, so long as (A) no Event of Default shall have occurred and be continuing and (B) the Borrower is in pro forma compliance with the Financial Covenant after giving effect to any such purchase;
(z) So long as no Event of Default shall have occurred and be continuing, Investments in Franchisees (including, but not limited to, (i) Guarantees or other credit support of any Indebtedness and other liabilities thereof and (ii) loans, advances or contributions to the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater of (A) $20,000,000 35,000,000 and 70(B) 25.0% of Consolidated EBITDA;
EBITDA for the Test Period then last ended at the time of making such Investment and (aaii) Investments consisting of accounts and payment intangibles owing to the Borrower or any of the Restricted Subsidiaries from Franchisees; provided that such obligation shall be on such terms as the Borrower or the applicable Restricted Subsidiary establishes in good faith; and
(bb) Investments consisting of advances or expenditures by any Loan Party to, or on behalf of, any CMF Subsidiary in support of advertising and marketing programs in the ordinary course consistent with current practices. For purposes Designated Acquired Subsidiaries in an amount not to exceed the greater of determining compliance with this Section 6.04, in (A) $10,000,000 and (B) 3.5 % of Consolidated EBITDA for the event that any item Test Period then last ended at the time of Investment meets the criteria of more than one of the categories of Investments described in clauses (a) through (bb) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify making such Investment (or any portion thereof) and will only be required to include the amount and type of such Investment in one or more of the above clauses.Investment;
Appears in 1 contract
Samples: Credit Agreement (Gogo Inc.)
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor the Borrower No Loan Party will, nor will they it permit any Restricted Subsidiary or Intermediate Parent to, make or hold maintain any Investment, except:
Investments other than: (a) Permitted Investments at existing on the time such Permitted Investment is made;
date hereof in or to Subsidiaries and set forth on Schedule 6.04 and any extensions or amendments thereto not increasing the principal or capital amount thereof; (b) Cash Equivalents; (c) Capital Expenditures and Capitalized Software Expenditures; (d) normal trade credit extended in the ordinary course of business and consistent with prudent business practice; (e) advances or loans to officers, directors or employees of the Borrower or its Subsidiaries for business related, education, entertainment, travel or moving expenses to be incurred in the ordinary course of business in an amount not to exceed the greater of (x) $1,000,000 and (y) 2.0% of Consolidated EBITDA as of the last day of the most recently ended Reference Period for which Financial Statements are available, in the aggregate outstanding at any one time, (f) Investments by the Borrower and the Subsidiaries in Equity Interests in, or capital or asset contributions to, their respective Subsidiaries; provided, that (i) any such Equity Interests held by a Loan Party shall be pledged pursuant to a Collateral Document to the extent required thereby (subject to the limitations and exceptions set forth in the applicable Collateral Document) and (ii) the aggregate amount of Investments by Loan Parties in Subsidiaries that are not Loan Parties (together with outstanding intercompany loans to Subsidiaries that are not Loan Parties permitted under Section 6.04(g) and outstanding Guarantees of Indebtedness of Subsidiaries that are not Loan Parties permitted under Section 6.04(h)) shall not exceed in the aggregate at any time outstanding, the greater of (x) $15,000,000 and (y) 25% of Consolidated EBITDA as of the last day of the most recently ended Reference Period for which Financial Statements are available; (g) loans or advances to officers, directors and employees of Holdings, any Intermediate Parent, made by the Borrower to any Subsidiary and made by any Subsidiary to the Restricted Subsidiaries Borrower or any other Subsidiary; provided, that, (i) for reasonable any such loans and customary business-related travel, entertainment, relocation advances made by a Loan Party shall be evidenced by a promissory note (which may be a global note) pledged pursuant to a Collateral Document and analogous ordinary business purposes, (ii) in connection with such Person’s purchase of Equity Interests in Holdings (or any direct or indirect parent thereof) (provided that the amount of such loans and advances made in cash to such Person shall be contributed to the Borrower in cash as common equity or Qualified Equity Interests) and (iii) for purposes not described in the foregoing clauses (i) and (ii); provided that at the time of incurrence thereof and after giving Pro Forma Effect thereto, the aggregate principal amount outstanding in reliance on this clause (iii) shall not exceed $1,000,000;
(c) Investments by Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary in any of Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary; provided that the aggregate outstanding amount of Investments made by Loan Parties in Restricted to Subsidiaries that are not Loan Parties (together with outstanding Investments in reliance on this clause (cSubsidiaries that are not Loan Parties permitted under Section 6.04(f) and outstanding Guarantees of Indebtedness of Subsidiaries that are not Loan Parties permitted under Section 6.04(h)) shall not exceed in the aggregate at any time outstanding, the greater of (x) $10,000,000 15,000,000 and 35(y) 25% of Consolidated EBITDA;
EBITDA as of the last day of the most recently ended Reference Period for which Financial Statements are available; (dh) Guarantees constituting Indebtedness permitted by Section 6.01; provided, that the aggregate principal amount of Indebtedness of Subsidiaries that are not Loan Parties that is Guaranteed by any Loan Party shall (together with outstanding Investments in Subsidiary that are not Loan Parties permitted under Section 6.04(f) and outstanding intercompany loans to Subsidiaries that are not Loan Parties permitted under Section 6.04(g)) shall not exceed, in the aggregate at any time outstanding, the greater of (x) $15,000,000 and (y) 25% of Consolidated EBITDA as of the last day of the most recently ended Reference Period for which Financial Statements are available; (i) Loans or advances made by the Borrower or any Subsidiary to any Person (including employees) not in the ordinary course of business not to exceed the greater of (x) $1,000,000 and (y) 2% of 77 Consolidated EBITDA as of the last day of the most recently ended Reference Period for which Financial Statements are available, in the aggregate outstanding at any one time; (j) Permitted Acquisitions; (k) Investments in cash and Cash Equivalents and obligations under Swap Agreements permitted by Section 6.05; (l) Investments consisting of prepayments to suppliers security deposits with utilities and other like Persons made in the ordinary course of business;
; (em) Investments consisting received in connection with any insolvency proceedings in respect of extensions any customers, suppliers or clients and in settlement of trade credit in the ordinary course of business;
delinquent obligations of, and other disputes with, customers, suppliers or clients; (fn) Investments (i) of any Person existing at the time such Person becomes a Subsidiary or contemplated on the date hereof and set forth on Schedule 6.04(f) and any modificationconsolidates, replacement, renewal, reinvestment amalgamates or extension thereof and (ii) Investments existing on the date hereof by Holdings, merges with the Borrower or any Restricted Subsidiary (including in connection with an Acquisition or other Investment permitted hereunder); provided that such Investment was not made in contemplation of such Person becoming a Subsidiary or such consolidation, amalgamation or merger; (o) upon foreclosure (or transfer of title in lieu of foreclosure) with respect to any secured Investment in a Person other than the Borrower or any Restricted a Subsidiary and any modificationthat, renewal or extension thereof; provided that the amount of the original Investment is not increased except by the terms in each case, was made without contemplation of such Investment to the extent as set forth on Schedule 6.04(f) foreclosure (or as otherwise permitted by this Section 6.04;
transfer of title in lieu of foreclosure); (g) Investments in Swap Agreements permitted under Section 6.01(a)(vi);
(h) promissory notes and other non-cash consideration received in connection with Dispositions permitted by Section 6.05;
(i) Permitted Acquisitions;
(j) the Transactions;
(kp) Investments in the ordinary course of business consisting of Article III endorsements for collection or deposit deposit; (q) the Borrower and its Subsidiaries may acquire and hold receivables and similar items owing to them in the ordinary course of business and payable or dischargeable in accordance with customary trade arrangements with customers consistent with past practices;
terms; (lr) Investments constituting customary deposits made in connection with the purchase of goods or services in the ordinary course of business; (including debt obligations s) Investments consisting of promissory notes and Equity Interests) other non-cash consideration, in each case received in connection with asset sales or dispositions permitted by Section 6.12 (other than Section 6.12(s) or Section 6.12(t) (to the bankruptcy or reorganization extent relating to Section 6.12(s)); provided that the applicable Loan Party complies with the requirements of suppliers and customers, from financially troubled account debtors or in settlement of delinquent obligations of, or other disputes with, customers and suppliers or upon the foreclosure applicable Collateral Document with respect to any secured Investment such promissory notes or other transfer of title with respect to any secured Investment;
instruments; (m) loans and advances to Holdings (or any direct or indirect parent thereof) or any Intermediate Parent in lieu of, and not in excess of the amount of (after giving effect to any other loans, advances or Restricted Payments in respect thereof), Restricted Payments to the extent permitted to be made to Holdings (or such parent) or such Intermediate Parent in accordance with Section 6.08(a);
(n) additional Investments and other acquisitions; provided that at the time any such Investment or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition made in reliance on this clause (n), together with the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (n), shall not exceed the sum of (A) the greater of $18,000,000 and 60% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Investment or other acquisition, plus (B) so long as no Event of Default has occurred and is continuing, the Available Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of such Investment;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby;
(pt) advances of payroll payments to employees in the ordinary course of business;
(q) business and Investments and other acquisitions to the extent that payment for such Investments is made with Qualified Equity Interests (excluding Cure Amounts) of Holdings (or any direct or indirect parent thereof or the IPO Entity); provided that (i) such amounts used pursuant to this clause (q) shall not increase employment and severance arrangements of officers and employees in the Available Amount ordinary course of business and (ii) any amounts used for such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof or the IPO Entity) shall otherwise be permitted transactions pursuant to this Section 6.04;
(r) Investments of a Subsidiary acquired after the Effective Date or of a Person merged or consolidated with any Subsidiary in accordance with this Section stock option plans and Section 6.03 after the Effective Date to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger or consolidation employee benefit plans and were in existence on the date of such acquisition, merger or consolidation;
(s) non-cash Investments in connection with tax planning and reorganization activities; provided that after giving effect to any such activities, the security interests of the Lenders in the Collateral, taken as a whole, would not be materially impaired;
(t) Investments consisting of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference to this Section 6.04(t)) under Sections 6.01, 6.02, 6.03, 6.05 and 6.08, respectively;
(u) additional Investments; provided that after giving effect to such Investment (A) on a Pro Forma Basis, the Total Net Leverage Ratio is less than or equal to 4.50 to 1.00 and (B) there is no continuing Event of Default;
(v) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the Borrower;
(w) to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Property, or other rights, in each case arrangements in the ordinary course of business;
; (u) any endorsement of a check or other medium of payment for deposit or collection, or any similar transaction in the normal course of business; (v) Investments to the extent that the consideration for such Investments is made solely with the Qualified Equity Interests of the Borrower; (w) [intentionally omitted]; (x) other Investments (as valued at the fair market value (as determined in good faith by an Unrestricted Subsidiary entered into prior to the day Borrower) of such Unrestricted Subsidiary Investment at the time each such Investment is redesignated as a Restricted Subsidiary pursuant to the definition of “Unrestricted Subsidiary”;
(y) Investments consisting of purchases of assets of Franchisees (including, but not limited to, area development contracts owned by Franchisees) in the ordinary course of business or otherwise in an amount not exceeding $60,000,000, so long as (A) no Event of Default shall have occurred and be continuing and (B) the Borrower is in pro forma compliance with the Financial Covenant after giving effect to any such purchase;
(z) So long as no Event of Default shall have occurred and be continuing, Investments in Franchisees (including, but not limited to, (i) Guarantees or other credit support of any Indebtedness and other liabilities thereof and (ii) loans, advances or contributions to the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater of $20,000,000 and 70% of Consolidated EBITDA;
(aa) Investments consisting of accounts and payment intangibles owing to the Borrower or any of the Restricted Subsidiaries from Franchiseesmade); provided that such obligation shall be on such terms as the Borrower or the applicable Restricted Subsidiary establishes in good faith; and
(bb) Investments consisting of advances or expenditures by any Loan Party to, or on behalf of, any CMF Subsidiary in support of advertising and marketing programs in the ordinary course consistent with current practices. For purposes of determining compliance with this Section 6.04, in the event that any item of Investment meets the criteria of more than one of the categories last day of Investments described in clauses (a) through (bb) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such Investment (or any portion thereof) and will only be required to include the amount and type of such Investment in one or more of the above clauses.78
Appears in 1 contract
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor the Borrower will, nor will they permit any Restricted Subsidiary or Intermediate Parent to, make or hold any Investment, except:
(a) Permitted Investments at the time such Permitted Investment is madeInvestments;
(b) loans or advances to officers, directors and employees of Holdings, any Intermediate Parent, the Borrower and the its Restricted Subsidiaries (i) for reasonable and customary business-related travel, entertainment, relocation and analogous ordinary business purposes, (ii) in connection with such Person’s purchase of Equity Interests in of Holdings (or any direct or indirect parent thereofthereof or any Employee Holding Vehicle) (provided that the amount of such loans and advances made in cash to such Person shall be contributed to the Borrower in cash as common equity or Qualified Equity Interests) and (iii) for purposes not described in the foregoing clauses (i) and (ii); provided that at the time of incurrence thereof and after giving Pro Forma Effect thereto, the in an aggregate principal amount outstanding in reliance on this clause (iii) shall at any time not to exceed $1,000,0005,000,000;
(c) Investments (i) by Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary in any of HoldingsLoan Party (excluding any new Restricted Subsidiary that becomes a Loan Party pursuant to such Investment), (ii) by any Intermediate ParentRestricted Subsidiary that is not a Loan Party in any other Restricted Subsidiary that is also not a Loan Party, (iii) by the Borrower or any Restricted Subsidiary (A) in any Restricted Subsidiary; provided that the aggregate outstanding amount of such Investments made by Loan Parties after the Closing Date in Restricted Subsidiaries that are not Loan Parties in reliance on this clause (ciii)(A) (including any such Investments deemed to be made pursuant to Section 6.14) (together with the amount of Investments made in Restricted Subsidiaries (other than Regulated Subsidiaries) that are not Loan Parties pursuant to Section 6.04(h) and the amount of Investments and acquisitions made pursuant to Section 6.04(m)) shall not exceed the greater Non-Loan Party Investment Amount at the time of $10,000,000 any such Investment, (B) in any Regulated Subsidiary in the form of short-term intercompany advances and 35% of Consolidated EBITDA;
(d) Investments consisting of prepayments to suppliers Indebtedness, in each case made in the ordinary course of businessbusiness to provide for working capital and other operational requirements of such Regulated Subsidiary, (C) in any Restricted Subsidiary that is not a Loan Party, constituting an exchange of Equity Interests of such Restricted Subsidiary for Indebtedness of such Subsidiary, (D) constituting Guarantees of Indebtedness or other monetary obligations of Restricted Subsidiaries that are not Loan Parties owing to any Loan Party or (E) constituting unsecured Guarantees of Trading Debt to the extent such Guarantees are permitted under Section 6.01(a)(iii), (iv) by Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary in Restricted Subsidiaries that are not Loan Parties so long as such Investment is part of a series of simultaneous transactions that result in the proceeds of the initial transaction being invested in one or more Loan Parties or, if the proceeds were initially held by a non-Loan Party, in a Restricted Subsidiary that is not a Loan Party and (v) by Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary in any Restricted Subsidiary that is not a Loan Party, consisting of the contribution of Equity Interests of any other Restricted Subsidiary that is not a Loan Party so long as the Equity Interests of the transferee Restricted Subsidiary is pledged to secure the Secured Obligations;
(ed) Investments consisting of extensions of trade credit in the ordinary course of business;
(fe) Investments (i) existing or contemplated on the date hereof and set forth on Schedule 6.04(f6.04(e) and any modification, replacement, renewal, reinvestment or extension thereof and (ii) Investments existing on the date hereof by Holdings, the Borrower or any Restricted Subsidiary in the Borrower or any Restricted Subsidiary and any modification, renewal or extension thereof; provided that in each case the amount of the original Investment is not increased except by the terms of such Investment to the extent as set forth on Schedule 6.04(f6.04(e) or as otherwise permitted by this Section 6.04;
(gf) Investments in Swap Agreements permitted under Section 6.01(a)(vi)6.07;
(hg) promissory notes and other non-cash consideration received in connection with Dispositions permitted by Section 6.05;
(ih) Permitted Acquisitions; provided that the aggregate amount of consideration paid or provided by Holdings, any Intermediate Parent, the Borrower or any other Loan Party (including any Indebtedness incurred by any such Person to finance any portion of such consideration) after the Closing Date in reliance on this Section 6.04(h) (together with any Investments made in Subsidiaries that are not Loan Parties pursuant to Section 6.04(c)(iii)(A), Investments deemed to be made pursuant to Section 6.14 and the amount of Investments and acquisitions made pursuant to Section 6.04(m)) for Permitted Acquisitions (including the aggregate principal amount of all Indebtedness assumed in connection with Permitted Acquisitions) of any Restricted Subsidiary (other than a Regulated Subsidiary) that shall not be or, after giving effect to such Permitted Acquisition, shall not become, a Loan Party, shall not exceed the Non-Loan Party Investment Amount at such time;
(i) Investments made during the Pre-IPO Period (except for the formation of the IPO Shell Companies, which may occur prior to the Pre-IPO Period) that the Borrower, in good faith, determines are reasonably necessary to effectuate the IPO Reorganization Transactions;
(j) the Transactions;
(k) Investments in the ordinary course of business consisting of Uniform Commercial Code Article 3 endorsements for collection or deposit and Uniform Commercial Code Article 4 customary trade arrangements with customers consistent with past practices;
(lk) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers and customers, from financially troubled account debtors customers or in settlement of delinquent obligations of, or other disputes with, customers and suppliers or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment;
(ml) loans and advances to Holdings (or any direct or indirect parent thereof) or any Intermediate Parent in lieu of, and not in excess of the amount of (after giving effect to any other loans, advances or Restricted Payments in respect thereof), Restricted Payments to the extent permitted to be made to Holdings (or such parent) or such Intermediate Parent in accordance with Section 6.08(a6.08(a)(iv), (v), (vi), (vii) or (viii);
(nm) additional so long as immediately after giving effect to any such Investment or acquisition no Default shall have occurred and be continuing, other Investments and other acquisitions; provided that at the time any such Investment (including any such Investments deemed to be made pursuant to Section 6.14) or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition all Investments made in reliance on this clause (nm) (including all such Investments deemed made pursuant to Section 6.14), Investments made in Subsidiaries that are not Loan Parties pursuant to Section 6.04(c)(iii)(A) and Investments made in Restricted Subsidiaries (other than Regulated Subsidiaries) that are not Loan Parties pursuant to Section 6.04(h), together with the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (nm) (including the aggregate principal amount of all Indebtedness assumed in connection with any such other acquisition), shall not exceed the sum Non-Loan Party Investment Amount at the time of (A) the greater of $18,000,000 and 60% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of any such Investment or other acquisition, plus (B) so long as no Event of Default has occurred and is continuing, the Available Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of such Investment;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby;
(pn) advances of payroll payments to employees in the ordinary course of business;
(qo) Investments and other acquisitions to the extent that payment for such Investments is made solely with Qualified Equity Interests (excluding Cure Amounts) of Holdings (or any direct or indirect parent thereof or the IPO Entity); provided that (i) such amounts used pursuant to this clause (q) shall not increase the Available Amount and (ii) any amounts used for such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof or the IPO Entity) shall otherwise be permitted pursuant to this Section 6.04;
(rp) Investments of a Subsidiary acquired after the Effective Closing Date or of a Person merged or consolidated with any Subsidiary in accordance with this Section and Section 6.03 after the Effective Closing Date (other than existing Investments in subsidiaries of such Subsidiary or Person, which must comply with the requirements of Section 6.04(h) or 6.04(m)) to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger or consolidation and were in existence on the date of such acquisition, merger or consolidation;
(sq) Investments made or acquired in the ordinary course trading activities of the Borrower and its Restricted Subsidiaries;
(r) non-cash Investments in connection with tax planning and reorganization activities; provided that after giving effect to any such activities, the security interests of the Lenders in the Collateral, taken as a whole, would not be materially impaired;
(t) Investments consisting of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference to this Section 6.04(t)) under Sections 6.01, 6.02, 6.03, 6.05 and 6.08, respectively;
(u) additional Investments; provided that after giving effect to such Investment (A) on a Pro Forma Basis, the Total Net Leverage Ratio is less than or equal to 4.50 to 1.00 and (B) there is no continuing Event of Default;
(v) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the Borrower;
(w) to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Property, or other rights, in each case in the ordinary course of business;
(x) Investments by an Unrestricted Subsidiary entered into prior to the day such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to the definition of “Unrestricted Subsidiary”;
(y) Investments consisting of purchases of assets of Franchisees (including, but not limited to, area development contracts owned by Franchisees) in the ordinary course of business or otherwise in an amount not exceeding $60,000,000, so long as (A) no Event of Default shall have occurred and be continuing and (B) the Borrower is in pro forma compliance with the Financial Covenant after giving effect to any such purchase;
(z) So long as no Event of Default shall have occurred and be continuing, Investments in Franchisees (including, but not limited to, (i) Guarantees or other credit support of any Indebtedness and other liabilities thereof and (ii) loans, advances or contributions to the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater of $20,000,000 and 70% of Consolidated EBITDA;
(aa) Investments consisting of accounts and payment intangibles owing to the Borrower or any of the Restricted Subsidiaries from Franchisees; provided that such obligation shall be on such terms as the Borrower or the applicable Restricted Subsidiary establishes in good faith; and
(bbs) Investments consisting of advances or expenditures by in any Loan Party to, or on behalf of, any CMF Foreign Subsidiary in support of advertising and marketing programs in made for the ordinary course consistent with current practices. For purposes of determining compliance providing such Foreign Subsidiary the necessary capital to comply with this Section 6.04, in any capital or margin requirements of a Regulatory Supervisory Organization; provided that the event that any item of Investment meets the criteria of more than one of the categories aggregate outstanding amount of Investments described in clauses (a) through (bb) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such Investment (or made pursuant to this clause shall not exceed $25,000,000 at any portion thereof) and will only be required to include the amount and type of such Investment in one or more of the above clausestime.
Appears in 1 contract
Samples: Incremental Revolving Facility Amendment and Joinder Agreement (Virtu Financial, Inc.)
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor the Borrower will, nor will they permit any Restricted Subsidiary or Intermediate Parent to, make or hold any Investment, except:
(a) Permitted Investments at the time such Permitted Investment is madeInvestments;
(b) loans or advances to officers, directors and employees of Holdings, any Intermediate Parent, the Borrower Holdings and the its Restricted Subsidiaries (i) for reasonable and customary business-related travel, entertainment, relocation and analogous ordinary business purposes, (ii) in connection with such Person’s purchase of Equity Interests in of Holdings (or any direct or indirect parent thereof) (provided that the amount of such loans and advances made in cash to such Person shall be contributed to the Borrower in cash as common equity or Qualified Equity Interestsequity) and (iii) for purposes not described in the foregoing clauses (i) and (ii); provided that at the time of incurrence thereof and after giving Pro Forma Effect thereto, the in an aggregate principal amount outstanding in reliance on this clause (iii) shall at any time not to exceed $1,000,0005,000,000;
(c) Investments (i) by Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary in any of Loan Party (excluding any new Restricted Subsidiary that becomes a Loan Party pursuant to such Investment), (ii) by any Restricted Subsidiary that is not a Loan Party in any other Restricted Subsidiary that is also not a Loan Party, (iii) by Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary (A) in any Restricted Subsidiary; provided that the aggregate outstanding amount of such Investments made by Loan Parties after the Effective Date in Restricted Subsidiaries that are not Loan Parties in reliance on this clause (ciii)(A) (together with the amount of Investments made in Restricted Subsidiaries that are not Loan Parties pursuant to Sections 6.04(h) and 6.04(p)) shall not exceed the greater Non-Loan Party Investment Amount at the time of $10,000,000 any such Investment, (B) in any Restricted Subsidiary that is not a Loan Party, constituting an exchange of Equity Interests of such Restricted Subsidiary for Indebtedness of such Restricted Subsidiary or (C) constituting Guarantees of Indebtedness or other monetary obligations of Restricted Subsidiaries that are not Loan Parties owing to any Loan Party, (iv) by Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary in Restricted Subsidiaries that are not Loan Parties so long as such Investment is part of a series of simultaneous Investments that result in the proceeds of the initial Investment being invested in one or more Loan Parties and 35% (v) by Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary in any Restricted Subsidiary that is not a Loan Party, consisting of Consolidated EBITDAthe contribution of Equity Interests of any other Restricted Subsidiary that is not a Loan Party so long as the Equity Interests of the transferee Restricted Subsidiary is pledged to secure the Secured Obligations;
(d) Investments consisting of prepayments to suppliers in the ordinary course of business;
(e) Investments consisting of extensions of trade credit in the ordinary course of business;
(fe) Investments (i) existing or contemplated on the date hereof and set forth on Schedule 6.04(f6.04(e) and any modification, replacement, renewal, reinvestment or extension thereof and (ii) Investments existing on the date hereof by Holdings, the Borrower or any Restricted Subsidiary in the Borrower or any Restricted Subsidiary and any modification, renewal or extension thereof; provided that the amount of the original Investment is not increased except by the terms of such Investment to the extent as set forth on Schedule 6.04(f6.04(e) or as otherwise permitted by this Section 6.04;
(g) Investments in Swap Agreements permitted under Section 6.01(a)(vi);
(h) promissory notes and other non-cash consideration received in connection with Dispositions permitted by Section 6.05;
(i) Permitted Acquisitions;
(j) the Transactions;
(k) Investments in the ordinary course of business consisting of endorsements for collection or deposit and customary trade arrangements with customers consistent with past practices;
(l) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers and customers, from financially troubled account debtors or in settlement of delinquent obligations of, or other disputes with, customers and suppliers or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment;
(m) loans and advances to Holdings (or any direct or indirect parent thereof) or any Intermediate Parent in lieu of, and not in excess of the amount of (after giving effect to any other loans, advances or Restricted Payments in respect thereof), Restricted Payments to the extent permitted to be made to Holdings (or such parent) or such Intermediate Parent in accordance with Section 6.08(a);
(n) additional Investments and other acquisitions; provided that at the time any such Investment or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition made in reliance on this clause (n), together with the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (n), shall not exceed the sum of (A) the greater of $18,000,000 and 60% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Investment or other acquisition, plus (B) so long as no Event of Default has occurred and is continuing, the Available Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of such Investment;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby;
(p) advances of payroll payments to employees in the ordinary course of business;
(q) Investments and other acquisitions to the extent that payment for such Investments is made with Qualified Equity Interests (excluding Cure Amounts) of Holdings (or any direct or indirect parent thereof or the IPO Entity); provided that (i) such amounts used pursuant to this clause (q) shall not increase the Available Amount and (ii) any amounts used for such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof or the IPO Entity) shall otherwise be permitted pursuant to this Section 6.04;
(r) Investments of a Subsidiary acquired after the Effective Date or of a Person merged or consolidated with any Subsidiary in accordance with this Section and Section 6.03 after the Effective Date to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger or consolidation and were in existence on the date of such acquisition, merger or consolidation;
(s) non-cash Investments in connection with tax planning and reorganization activities; provided that after giving effect to any such activities, the security interests of the Lenders in the Collateral, taken as a whole, would not be materially impaired;
(t) Investments consisting of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference to this Section 6.04(t)) under Sections 6.01, 6.02, 6.03, 6.05 and 6.08, respectively;
(u) additional Investments; provided that after giving effect to such Investment (A) on a Pro Forma Basis, the Total Net Leverage Ratio is less than or equal to 4.50 to 1.00 and (B) there is no continuing Event of Default;
(v) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the Borrower;
(w) to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Property, or other rights, in each case in the ordinary course of business;
(x) Investments by an Unrestricted Subsidiary entered into prior to the day such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to the definition of “Unrestricted Subsidiary”;
(y) Investments consisting of purchases of assets of Franchisees (including, but not limited to, area development contracts owned by Franchisees) in the ordinary course of business or otherwise in an amount not exceeding $60,000,000, so long as (A) no Event of Default shall have occurred and be continuing and (B) the Borrower is in pro forma compliance with the Financial Covenant after giving effect to any such purchase;
(z) So long as no Event of Default shall have occurred and be continuing, Investments in Franchisees (including, but not limited to, (i) Guarantees or other credit support of any Indebtedness and other liabilities thereof and (ii) loans, advances or contributions to the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater of $20,000,000 and 70% of Consolidated EBITDA;
(aa) Investments consisting of accounts and payment intangibles owing to the Borrower or any of the Restricted Subsidiaries from Franchisees; provided that such obligation shall be on such terms as the Borrower or the applicable Restricted Subsidiary establishes in good faith; and
(bb) Investments consisting of advances or expenditures by any Loan Party to, or on behalf of, any CMF Subsidiary in support of advertising and marketing programs in the ordinary course consistent with current practices. For purposes of determining compliance with this Section 6.04, in the event that any item of Investment meets the criteria of more than one of the categories of Investments described in clauses (a) through (bb) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such Investment (or any portion thereof) and will only be required to include the amount and type of such Investment in one or more of the above clauses.
Appears in 1 contract
Samples: Credit Agreement (Schiff Nutrition International, Inc.)
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor the The Borrower willshall not, nor will they and shall not cause or permit any Restricted Subsidiary or Intermediate Parent to, make purchase, hold or hold acquire (including pursuant to any merger with any Person that was not a Wholly Owned Subsidiary prior to such merger) any Investment, except:
(a) Permitted Investments at Cash Equivalent Investments; provided that, any Investment that when made complies with the time requirements of the definition of the term “Cash Equivalent Investment” may continue to be held pursuant to this clause (a) notwithstanding that such Permitted Investment is madeif made thereafter would not comply with such requirements;
(b) Investments by the Borrower and each Subsidiary in the Equity Interests of its Subsidiaries; provided that (x) any Investments in Equity Interests held by the Company or any other Loan Party shall be pledged to the extent required under and in accordance with the requirements of Section 5.9 and (y) the aggregate amount of Investments made by any Loan Party after the Effective Date in any Subsidiary that is not a Loan Party in reliance on this clause (b), when combined with (i) the aggregate outstanding amount of loans and advances made by any Loan Party to any Subsidiary that is not a Loan Party in reliance on clause (c) below and (ii) the aggregate amount of Guarantees made by any Loan Party of outstanding Indebtedness of any Subsidiary that is not a Loan Party in reliance on clause (c) below, shall not exceed $25,000,000 at any time;
(c) loans or advances made by the Borrower to any Subsidiary and made by any Subsidiary to the Borrower or any other Subsidiary, and Guarantees by the Borrower or any Subsidiary of any Indebtedness of the Borrower or any Subsidiary permitted under Section 6.2; provided that the sum of (i) the aggregate outstanding amount of loans and advances made by any Loan Party to any Subsidiary that is not a Loan Party in reliance on this clause (c), (ii) the aggregate amount of Guarantees made by any Loan Party of outstanding Indebtedness of any Subsidiary that is not a Loan Party in reliance on this clause (c) plus (iii) the aggregate amount of Investments made by any Loan Party in any Subsidiary that is not a Loan Party in reliance on clause (b) above shall not exceed $25,000,000 at any time;
(d) Guarantees constituting Indebtedness permitted by Section 6.2;
(e) advances to officers, directors and employees of Holdings, any Intermediate Parent, the Borrower and the Restricted Subsidiaries in an aggregate amount not to exceed $3,000,000 at any time outstanding (i) for reasonable and customary business-related travel, entertainment, relocation and analogous ordinary business purposes, purposes or (ii) in connection with such Person’s to finance the purchase of Equity Interests in Holdings (or any direct or indirect parent thereof) (provided that the amount of such loans and advances made in cash to such Person shall be contributed to the Borrower in cash as common equity or Qualified Equity Interests) and (iii) for purposes not described in the foregoing clauses (i) and (ii); provided that at the time of incurrence thereof and after giving Pro Forma Effect thereto, the aggregate principal amount outstanding in reliance on this clause (iii) shall not exceed $1,000,000pursuant to employee plans;
(cf) Investments by Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary in any of Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary; provided that the aggregate outstanding amount of Investments made by Loan Parties in Restricted Subsidiaries that are not Loan Parties in reliance on this clause (c) shall not exceed the greater of $10,000,000 and 35% of Consolidated EBITDA;
(d) Investments consisting of prepayments to suppliers bank deposits in the ordinary course of business;
(eg) Investments consisting of extensions of credit in the nature of accounts receivable or notes receivable arising from the grant of trade credit in the ordinary course of business;
(f) , and Investments (i) existing received in satisfaction or contemplated on the date hereof and set forth on Schedule 6.04(f) and any modification, replacement, renewal, reinvestment or extension partial satisfaction thereof and (ii) Investments existing on the date hereof by Holdings, the Borrower or any Restricted Subsidiary in the Borrower or any Restricted Subsidiary and any modification, renewal or extension thereof; provided that the amount of the original Investment is not increased except by the terms of such Investment from financially troubled account debtors to the extent as set forth on Schedule 6.04(f) reasonably necessary in order to prevent or as otherwise permitted by this Section 6.04;
(g) Investments in Swap Agreements permitted under Section 6.01(a)(vi)limit loss;
(h) promissory notes and other non-cash consideration received received, to the extent permitted by the Loan Documents, in connection with Dispositions the Disposition of property permitted by Section 6.05this Agreement;
(i) Permitted Acquisitions;
(j) Investments listed on Schedule 6.6 as of the TransactionsEffective Date and any modification, replacement, renewal, reinvestment or extension thereof; provided that the amount of any Investment permitted pursuant to this Section 6.6(j) is not increased from the amount of such Investment on the Effective Date except pursuant to the terms of such Investment as of the Effective Date or as otherwise permitted by this Section 6.6;
(k) Investments by the Borrower or any Subsidiary in a Person (or a business or division thereof) which is engaged in a business then engaged in by the Loan Parties (or for use in such business of the Loan Parties) or businesses similar or reasonably related thereto (as determined by the Borrower’s board of directors), not to exceed $150,000,000 during the term of this Agreement; provided, that in the ordinary course event that after giving effect to any such Investment the aggregate amount of business consisting such Investments pursuant to this clause (k) during the term of endorsements for collection or deposit this Agreement would exceed $50,000,000, immediately after giving effect to such Investment, (i) no Default shall exist, (ii) the Borrower shall be in pro forma compliance with all the financial ratios and customary trade arrangements with customers consistent with past practicesrestrictions set forth in Section 6.1, (iii) the sum of Unrestricted Cash plus the aggregate unused Revolving Commitments shall be at least $100,000,000 and (iv) the aggregate unused Revolving Commitments shall be at least $50,000,000;
(l) Investments (including debt obligations i) in commercial paper maturing within 270 days from the date of acquisition thereof and Equity Interestsissued by or offered by any Lender, (ii) received in connection with any variable or fixed rate notes (other than notes of the bankruptcy or reorganization type described in clause (g) of suppliers and customers, from financially troubled account debtors or in settlement the definition of delinquent obligations of“Cash Equivalent Investments”) issued by, or other disputes withguaranteed by, customers any corporation rated A-1 (or the equivalent thereof) or better by S&P or P-1 (or the equivalent thereof) or better by Xxxxx’x and suppliers maturing within twelve (12) months from the date of acquisition or upon (iii) permitted by the foreclosure with respect Borrower’s cash investment policy approved by the Borrower’s board of directors (or a committee thereof) as such policy is in effect, and as disclosed to the Lenders, prior to the Effective Date and subject to any secured Investment amendments or other transfer modifications to such policy as are approved by the Borrower’s board of title with respect directors (or a committee thereof) after the Effective Date and are reasonably acceptable to any secured Investment;the Required Lenders; and
(m) loans and advances in addition to Holdings (or any direct or indirect parent thereof) or any Intermediate Parent in lieu ofInvestments otherwise expressly permitted by this Section, and not in excess of the amount of (after giving effect to any other loans, advances or Restricted Payments in respect thereof), Restricted Payments to the extent permitted to be made to Holdings (or such parent) or such Intermediate Parent in accordance with Section 6.08(a);
(n) additional Investments and other acquisitions; provided that at the time any such Investment or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition made in reliance on this clause (n), together with the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (n), shall not exceed the sum of (A) the greater of $18,000,000 and 60% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Investment or other acquisition, plus (B) so long as no Event of Default has occurred and is continuing, the Available Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of such Investment;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby;
(p) advances of payroll payments to employees in the ordinary course of business;
(q) Investments and other acquisitions to the extent that payment for such Investments is made with Qualified Equity Interests (excluding Cure Amounts) of Holdings (or any direct or indirect parent thereof or the IPO Entity); provided that (i) such amounts used pursuant to this clause (q) shall not increase the Available Amount and (ii) any amounts used for such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof or the IPO Entity) shall otherwise be permitted pursuant to this Section 6.04;
(r) Investments of a Subsidiary acquired after the Effective Date or of a Person merged or consolidated with any Subsidiary in accordance with this Section and Section 6.03 after the Effective Date to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger or consolidation and were in existence on the date of such acquisition, merger or consolidation;
(s) non-cash Investments in connection with tax planning and reorganization activities; provided that after giving effect to any such activities, the security interests of the Lenders in the Collateral, taken as a whole, would not be materially impaired;
(t) Investments consisting of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference to this Section 6.04(t)) under Sections 6.01, 6.02, 6.03, 6.05 and 6.08, respectively;
(u) additional Investments; provided that after giving effect to such Investment (A) on a Pro Forma Basis, the Total Net Leverage Ratio is less than or equal to 4.50 to 1.00 and (B) there is no continuing Event of Default;
(v) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the Borrower;
(w) to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Property, or other rights, in each case in the ordinary course of business;
(x) Investments by an Unrestricted Subsidiary entered into prior to the day such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to the definition of “Unrestricted Subsidiary”;
(y) Investments consisting of purchases of assets of Franchisees (including, but not limited to, area development contracts owned by Franchisees) in the ordinary course of business or otherwise in an amount not exceeding $60,000,000, so long as (A) no Event of Default shall have occurred and be continuing and (B) the Borrower is in pro forma compliance with the Financial Covenant after giving effect to any such purchase;
(z) So long as no Event of Default shall have occurred and be continuing, Investments in Franchisees (including, but not limited to, (i) Guarantees or other credit support of any Indebtedness and other liabilities thereof and (ii) loans, advances or contributions to the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater of $20,000,000 and 70% of Consolidated EBITDA;
(aa) Investments consisting of accounts and payment intangibles owing to the Borrower or any of its Subsidiaries in an aggregate amount not to exceed $25,000,000 during the Restricted Subsidiaries from Franchisees; provided that such obligation shall be on such terms as the Borrower or the applicable Restricted Subsidiary establishes in good faith; and
(bb) Investments consisting term of advances or expenditures by any Loan Party to, or on behalf of, any CMF Subsidiary in support of advertising and marketing programs in the ordinary course consistent with current practices. For purposes of determining compliance with this Section 6.04, in the event that any item of Investment meets the criteria of more than one of the categories of Investments described in clauses (a) through (bb) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such Investment (or any portion thereof) and will only be required to include the amount and type of such Investment in one or more of the above clausesAgreement.
Appears in 1 contract
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor the Borrower willBorrowers will not, nor will they permit any Restricted Subsidiary or Intermediate Parent of a Borrower to, make or hold any Investment, except:
(a) Permitted Investments Cash Equivalents at the time such Permitted Investment is made;
(b) loans or advances to present or former officers, directors directors, managers, members of management, employees, independent contractors and employees consultants of Parent and its Subsidiaries (excluding International Holdings and any Subsidiaries of International Holdings, any Intermediate Parent, the Borrower and the Restricted Subsidiaries ) (i) for reasonable and customary business-related travel, entertainment, relocation and analogous ordinary business purposes, (ii) in connection with such Person’s 's purchase of Equity Interests in Holdings (or any direct or indirect parent thereof) Parent (provided that the amount of such loans and advances made in cash to such Person shall be contributed to the Borrower Parent in cash as common equity or Qualified Equity Interests) and (iii) for purposes not described in the foregoing clauses (i) and (ii); provided that at the time of incurrence thereof and after giving Pro Forma Effect pro forma effect thereto, the aggregate principal amount outstanding in reliance on this clause (iii) shall not exceed $1,000,000250,000; provided further, that such limitation shall not apply in respect of loans or advances to independent contractors and consultants;
(c) Investments (i) by Holdings, Parent or any Intermediate Parent, the Borrower or any Restricted Subsidiary of a Borrower in any Loan Party (other than Parent), (ii) by any Subsidiary of Holdingsa Borrower that is not a Loan Party in any other Subsidiary of a Borrower that is also not a Loan Party, (iii) by Parent, any Intermediate Parent, the Borrower or any Restricted SubsidiarySubsidiary of a Borrower (A) in any Subsidiary of a Borrower; provided that (x) the aggregate outstanding amount of such Investments made by Loan Parties after the Effective Date in Restricted Subsidiaries of a Borrower that are not Loan Parties in reliance on this clause (ciii)(A), together with the aggregate amount of (x) all other Investments made in and Dispositions made to Subsidiaries of a Borrower that are not Loan Parties by any Loan Parties after the Effective Date and (y) all Investments and Dispositions made in reliance on Section 7.16(ii), shall not exceed, at the time of the making thereof and after giving pro forma effect thereto, $250,000, (y) no Event of Default has occurred and is continuing and (z) all Investments made by Loan Parties in Subsidiaries of a Borrower that are not Loan Parties in reliance on this clause (iii)(A) shall be made only for the purpose of financing working capital needs of such non Loan Parties or another purpose agreed to by the Required Lenders (such consent not exceed to be unreasonably withheld, conditioned or delayed; provided, that it is acknowledged and agreed that it shall not be unreasonable to withhold consent to any such transaction that will have a material adverse impact on any Guarantee or the greater Collateral) and shall be evidenced by an intercompany note that has been pledged as Collateral, (B) [reserved] or (C) constituting Guarantees of $10,000,000 and 35% Debt or other monetary obligations of Consolidated EBITDASubsidiaries of a Borrower that are not Loan Parties owing to any Loan Party, (iv) by Parent, any Borrower or any Subsidiary of a Borrower in Subsidiaries that are not Loan Parties so long as such transaction is part of a series of simultaneous transactions that results in the proceeds of the initial Investment being invested in one or more Loan Parties (other than Parent), (v) subject to the consent of the Required Lenders, by Parent, any Borrower or any Subsidiary of a Borrower in any Subsidiary of a Borrower that is not a Loan Party, consisting of the contribution of Equity Interests of any other Subsidiary of a Borrower that is not a Loan Party so long as the Equity Interests of the transferee Subsidiary is pledged to secure the Obligations;
(d) Investments consisting of deposits, prepayments and/or other credits to suppliers in the ordinary course of business;
(e) Investments consisting of extensions of trade credit in the ordinary course of business;
(f) Investments (i) existing or contemplated on the date hereof and set forth on Schedule 6.04(f7.04(f) and any modification, replacement, renewal, reinvestment or extension thereof and (ii) Investments existing on the date hereof Effective Date by HoldingsParent, the any Borrower or any Restricted Subsidiary in the of a Borrower or any Restricted Subsidiary and any modification, renewal or extension thereof; provided that the amount of the original Investment is not increased except by the terms of such Investment to the extent as set forth on Schedule 6.04(f7.04(f) or as otherwise permitted by this Section 6.047.04;
(g) Investments in Swap Agreements Contracts permitted under Section 6.01(a)(vi)7.01;
(h) promissory notes and other non-cash consideration received in connection with Dispositions permitted by Section 6.057.05;
(i) Permitted AcquisitionsInvestments made in connection with the Reorganization Transactions (other than borrowings under the Term Loan Agreement);
(j) subject to the Transactionsconsent of the Required Lenders, Investments made by any Loan Party in any non-Loan Party consisting of contributions or other Dispositions of Equity Interests of Persons that are non-Loan Parties; provided that, prior to such contribution or Disposition, such Equity Interests were not owned directly by a Loan Party or such Equity Interests are contributed or disposed to a non-Loan Party that is a wholly-owned Subsidiary of a Loan Party;
(k) Investments in the ordinary course of business consisting of endorsements for collection or deposit and customary trade arrangements with customers consistent with past practices;
(l) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers and customers, from financially troubled account debtors or in settlement of delinquent obligations of, or other disputes with, customers and suppliers or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment;
(m) loans subject to the consent of the Required Lenders (such consent not to be unreasonably withheld, conditioned or delayed; provided, that it is acknowledged and advances agreed that it shall not be unreasonable to Holdings withhold consent to any such transaction that will have a material adverse impact on any Guarantee or the Collateral), cash or property distributed from any Subsidiary of a Borrower that is not a Loan Party (or any direct or indirect parent thereofi) or any Intermediate Parent in lieu ofmay be contributed to other Subsidiaries of a Borrower that are not Loan Parties, and not (ii) may pass through Parent, Borrowers and/or any intermediate Subsidiaries of a Borrower that are Loan Parties in excess of order to effect the amount of contribution described in clause (after giving effect to any other loans, advances or Restricted Payments in respect thereofi), Restricted Payments to the extent so long as part of a series of related transactions and such transaction steps are not unreasonably delayed and are otherwise permitted to be made to Holdings (or such parent) or such Intermediate Parent in accordance with Section 6.08(a)hereunder;
(n) additional Investments and other acquisitionsacquisitions made and held by the Loan Parties (other than Parent); provided that at the time any such Investment or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition made in reliance on this clause (n), together with (including the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (n)), whether in the form of Debt assumed or otherwise), shall not exceed the sum of (A) the greater of $18,000,000 and 60% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Investment or other acquisition, plus (B) so long as no Event of Default has occurred and is continuing, the Available Amount that is Not Otherwise Applied as in effect immediately prior to at the time of making incurrence thereof and after giving pro forma effect thereto, $250,000; provided that (x) the aggregate amount of such InvestmentInvestments made by Loan Parties after the Effective Date in Subsidiaries of a Borrower that are not Loan Parties in reliance on this clause (n), together with the aggregate amount of (x) all other Investments made in and Dispositions made to Subsidiaries of a Borrower that are not Loan Parties by Loan Parties after the Effective Date and (y) all Investments and Dispositions made in reliance on Section 7.16(ii), shall not exceed, at the time of the making thereof and after giving pro forma effect thereto, $250,000 at any time outstanding and (y) all Investments made by Loan Parties in Subsidiaries of a Borrower that are not Loan Parties in reliance on this clause (n) shall be made only for the purpose of financing working capital needs of such non Loan Parties or another purpose agreed to by the Required Lenders (such consent not to be unreasonably withheld, conditioned or delayed; provided, that it is acknowledged and agreed that it shall not be unreasonable to withhold consent to any such transaction that will have a material adverse impact on any Guarantee or the Collateral) and shall be evidenced by an intercompany note that has been pledged as Collateral;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby[reserved];
(p) advances of payroll payments to employees in the ordinary course of business;
(q) Investments and other acquisitions to the extent that payment for such Investments is made with Qualified Equity Interests (excluding Cure Amounts) of Holdings (or any direct or indirect parent thereof or the IPO Entity)Parent; provided that (i) such amounts used pursuant to this clause (q) shall not increase the Available Amount and (ii) any other amounts used for such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof or the IPO Entity) Parent shall otherwise be permitted pursuant to this Section 6.047.04;
(r) Investments of a Subsidiary acquired after the Effective Date or of a Person merged or consolidated with any Subsidiary in accordance with this Section and Section 6.03 after the Effective Date to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger or consolidation and were in existence on the date of such acquisition, merger or consolidation[reserved];
(s) non-cash Investments in connection with tax planning and reorganization activities; provided that after giving effect to any such activities, the security interests of the Lenders in the Collateral, taken as a whole, would not be materially impaired[reserved];
(t) Investments consisting of IndebtednessDebt, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference to this Section 6.04(t7.04(t)) under Sections 6.017.01, 6.027.02, 6.037.03, 6.05 7.05 and 6.087.08, respectively;
(u) additional Investments; provided that after giving effect to such Investment (A) on a Pro Forma Basis, the Total Net Leverage Ratio is less than or equal to 4.50 to 1.00 and (B) there is no continuing Event of Default[reserved];
(v) contributions to a “"rabbi” " trust for the benefit of employees, directors, consultants, independent contractors or other service providers of Parent, any Borrower or any Subsidiary of a Borrower or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the BorrowerParent;
(w) to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Property, or other rights, in each case in the ordinary course of business;
(x) Investments by an Unrestricted Subsidiary entered into prior to the day such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to the definition of “Unrestricted Subsidiary”[reserved];
(y) Investments consisting of purchases of assets of Franchisees (including, but not limited to, area development contracts owned by Franchisees) in the ordinary course of business or otherwise in an amount not exceeding $60,000,000, so long as (A) no Event of Default shall have occurred and be continuing and (B) the Borrower is in pro forma compliance with the Financial Covenant after giving effect to any such purchase[reserved];
(z) So long as no Event of Default shall have occurred and be continuing, Investments in Franchisees (including, but not limited to, (i) Guarantees or other credit support of any Indebtedness and other liabilities thereof and (ii) loans, advances or contributions to the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater of $20,000,000 and 70% of Consolidated EBITDA[reserved];
(aa) Investments consisting of accounts and payment intangibles owing to the Borrower or any of the Restricted Subsidiaries from Franchisees; provided that such obligation shall be on such terms as the Borrower or the applicable Restricted Subsidiary establishes in good faith[reserved]; and
(bb) Investments consisting of advances or expenditures by any Loan Party to, or on behalf of, any CMF Subsidiary in support of advertising unfunded pension fund and marketing programs in other employee benefit plan obligations and liabilities to the ordinary course consistent with current practices. For purposes of determining compliance with this Section 6.04, in extent that the event that any item of Investment meets the criteria of more than one of the categories of Investments described in clauses (a) through (bb) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such Investment (or any portion thereof) and will only be required same are permitted to include the amount and type of such Investment in one or more of the above clausesremain unfunded under applicable Laws.
Appears in 1 contract
Samples: Loan and Security Agreement (INVACARE HOLDINGS Corp)
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor the Borrower will, nor will they permit any Restricted Subsidiary or Intermediate Parent to, make or hold any Investment, except:
(a) Permitted Investments at the time such Permitted Investment is madeInvestments;
(b) loans or advances to officers, directors and employees of Holdings, any Intermediate Parent, the Borrower and the its Restricted Subsidiaries (i) for reasonable and customary business-related travel, entertainment, relocation and analogous ordinary business purposes, (ii) in connection with such Person’s purchase of Equity Interests in of Holdings (or any direct or indirect parent thereofthereof or any Employee Holding Vehicle) (provided that the amount of such loans and advances made in cash to such Person shall be contributed to the Borrower in cash as common equity or Qualified Equity Interests) and (iii) for purposes not described in the foregoing clauses (i) and (ii); provided that at the time of incurrence thereof and after giving Pro Forma Effect thereto, the in an aggregate principal amount outstanding at any time not to exceed $5,000,000;
(c) Investments (i) by Holdings, the Borrower or any Restricted Subsidiary in any Loan Party (excluding any new Restricted Subsidiary that becomes a Loan Party pursuant to such Investment), (ii) by any Restricted Subsidiary that is not a Loan Party in any other Restricted Subsidiary that is also not a Loan Party, (iii) by Holdings or any Restricted Subsidiary (A) in any Restricted Subsidiary; provided that the aggregate amount of such Investments made by Loan Parties after the Restatement Effective Date in Restricted Subsidiaries that are not Loan Parties in reliance on this clause (iiiiii)(A) (including any such Investments deemed to be made pursuant to Section 6.14) (together with the amount of Investments made in Restricted Subsidiaries (other than Regulated Subsidiaries) that are not Loan Parties pursuant to Section 6.04(h) and the amount of Investments and acquisitions made pursuant to Section 6.04(m), in each case, after the Restatement Effective Date) shall not exceed $1,000,000;
the Non-Loan Party Investment Amount at the time of any such Investment, (cB) Investments in any Regulated Subsidiary in the form of short-term intercompany advances and Indebtedness, in each case made in the ordinary course of business to provide for working capital and other operational requirements of such Regulated Subsidiary, (C) in any Restricted Subsidiary that is not a Loan Party, constituting an exchange of Equity Interests of such Restricted Subsidiary for Indebtedness of such Subsidiary, (D) constituting Guarantees of Indebtedness or other monetary obligations of Restricted Subsidiaries that are not Loan Parties owing to any Loan Party or (E) constituting unsecured Guarantees of Trading Debt to the extent such Guarantees are permitted under Section 6.01(a)(iii), (1) by Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary in any of Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary; provided that the aggregate outstanding amount of Investments made by Loan Parties in Restricted Subsidiaries that are not Loan Parties so long as such Investment is part of a series of simultaneous transactions that result in reliance on this clause the proceeds of the initial transaction being invested in one or more Loan Parties or, if the proceeds were initially held by a non-Loan Party, in a Restricted Subsidiary that is not a Loan Party and (civ) shall by Holdings, the Borrower or any Restricted Subsidiary in any Restricted Subsidiary that is not exceed a Loan Party, consisting of the greater 140 contribution of $10,000,000 and 35% Equity Interests of Consolidated EBITDAany other Restricted Subsidiary that is not a Loan Party so long as the Equity Interests of the transferee Restricted Subsidiary is pledged to secure the Secured Obligations;
(d) Investments consisting of prepayments to suppliers in the ordinary course of business;
(e) Investments consisting of extensions of trade credit in the ordinary course of business;
(fe) Investments (i) existing or contemplated on the date hereof Restatement Effective Date and set forth on Schedule 6.04(f6.04(e) and any modification, replacement, renewal, reinvestment or extension thereof and (ii) Investments existing on the date hereof Restatement Effective Date by Holdings, the Borrower or any Restricted Subsidiary in the Borrower or any Restricted Subsidiary and any modification, renewal or extension thereof; provided that in each case the amount of the original Investment is not increased except by the terms of such Investment to the extent as set forth on Schedule 6.04(f6.04(e) or as otherwise permitted by this Section 6.04;
(gf) Investments in Swap Agreements permitted under Section 6.01(a)(vi)6.07;
(hg) promissory notes and other non-cash consideration received in connection with Dispositions permitted by Section 6.05;
(ih) Permitted Acquisitions; provided that the aggregate amount of consideration paid or provided by Holdings, any Intermediate Parent, the Borrower or any other Loan Party (including any Indebtedness incurred by any such Person to finance any portion of such consideration) after the Restatement Effective Date in reliance on this Section 6.04(h) (together with any Investments made in Subsidiaries that are not Loan Parties pursuant to Section 6.04(c)(iii)(A), Investments deemed to be made pursuant to Section 6.14 and the amount of Investments and acquisitions made pursuant to Section 6.04(m), in each case, after the Restatement Effective Date) for Permitted Acquisitions (including the aggregate principal amount of all Indebtedness assumed in connection with Permitted Acquisitions) of any Restricted Subsidiary (other than a Regulated Subsidiary) that shall not be or, after giving effect to such Permitted Acquisition, shall not become, a Loan Party, shall not exceed the Non-Loan Party Investment Amount at such time;
(i) prior to the Escrow Assumption Date, Investments in the Escrow Borrower to fund interest and other amounts owing or required to be pre-funded with respect to the Escrow Term Loans and, to the extent applicable, interest and other amounts owing or required to be pre-funded in respect of the Second Lien Notes;
(j) the Transactions;
(k) Investments in the ordinary course of business consisting of Uniform Commercial Code Article 3 endorsements for collection or deposit and Uniform Commercial Code Article 4 customary trade arrangements with customers consistent with past practices;
(lk) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers and customers, from financially troubled account debtors customers or in settlement of delinquent obligations of, or other disputes with, customers and suppliers 141 or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment;
(ml) loans and advances to Holdings (or any direct or indirect parent thereof) or any Intermediate Parent in lieu of, and not in excess of the amount of (after giving effect to any other loans, advances or Restricted Payments in respect thereof), Restricted Payments to the extent permitted to be made to Holdings (or such parent) or such Intermediate Parent in accordance with Section 6.08(a6.08(a)(iv), (v), (vi), (vii) or (viii);
(nm) additional so long as immediately after giving effect to any such Investment or acquisition no Default shall have occurred and be continuing, other Investments and other acquisitions; provided that at the time any such Investment (including any such Investments deemed to be made pursuant to Section 6.14) or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition all Investments made in reliance on this clause (nm) (including all such Investments deemed made pursuant to Section 6.14), Investments made in Subsidiaries that are not Loan Parties pursuant to Section 6.04(c)(iii)(A) and Investments made in Restricted Subsidiaries (other than Regulated Subsidiaries) that are not Loan Parties pursuant to Section 6.04(h), together with the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (nm) (including the aggregate principal amount of all Indebtedness assumed in connection with any such other acquisition), in each case, after the Restatement Effective Date, shall not exceed the sum Non-Loan Party Investment Amount at the time of (A) the greater of $18,000,000 and 60% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of any such Investment or other acquisition, plus (B) so long as no Event of Default has occurred and is continuing, the Available Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of such Investment;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby;
(pn) advances of payroll payments to employees in the ordinary course of business;
(qo) Investments and other acquisitions to the extent that payment for such Investments is made solely with Qualified Equity Interests (excluding Cure Amounts) of Holdings (or any direct or indirect parent thereof or the IPO Entitythereof); provided that (i) such amounts used pursuant to this clause (q) shall not increase the Available Amount and (ii) any amounts used for such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof or the IPO Entity) shall otherwise be permitted pursuant to this Section 6.04;
(r) Investments of a Subsidiary acquired after the Effective Date or of a Person merged or consolidated with any Subsidiary in accordance with this Section and Section 6.03 after the Effective Date to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger or consolidation and were in existence on the date of such acquisition, merger or consolidation;
(s) non-cash Investments in connection with tax planning and reorganization activities; provided that after giving effect to any such activities, the security interests of the Lenders in the Collateral, taken as a whole, would not be materially impaired;
(t) Investments consisting of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference to this Section 6.04(t)) under Sections 6.01, 6.02, 6.03, 6.05 and 6.08, respectively;
(u) additional Investments; provided that after giving effect to such Investment (A) on a Pro Forma Basis, the Total Net Leverage Ratio is less than or equal to 4.50 to 1.00 and (B) there is no continuing Event of Default;
(v) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the Borrower;
(w) to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Property, or other rights, in each case in the ordinary course of business;
(x) Investments by an Unrestricted Subsidiary entered into prior to the day such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to the definition of “Unrestricted Subsidiary”;
(y) Investments consisting of purchases of assets of Franchisees (including, but not limited to, area development contracts owned by Franchisees) in the ordinary course of business or otherwise in an amount not exceeding $60,000,000, so long as (A) no Event of Default shall have occurred and be continuing and (B) the Borrower is in pro forma compliance with the Financial Covenant after giving effect to any such purchase;
(z) So long as no Event of Default shall have occurred and be continuing, Investments in Franchisees (including, but not limited to, (i) Guarantees or other credit support of any Indebtedness and other liabilities thereof and (ii) loans, advances or contributions to the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater of $20,000,000 and 70% of Consolidated EBITDA;
(aa) Investments consisting of accounts and payment intangibles owing to the Borrower or any of the Restricted Subsidiaries from Franchisees; provided that such obligation shall be on such terms as the Borrower or the applicable Restricted Subsidiary establishes in good faith; and
(bb) Investments consisting of advances or expenditures by any Loan Party to, or on behalf of, any CMF Subsidiary in support of advertising and marketing programs in the ordinary course consistent with current practices. For purposes of determining compliance with this Section 6.04, in the event that any item of Investment meets the criteria of more than one of the categories of Investments described in clauses (a) through (bb) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such Investment (or any portion thereof) and will only be required to include the amount and type of such Investment in one or more of the above clauses.
Appears in 1 contract
Samples: Credit Agreement
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings Holdings, the Company nor the any Borrower will, nor will they permit any Restricted Subsidiary or Intermediate Parent to, make or hold any Investment, except:
(a) Permitted Investments at the time such Permitted Investment is made;
(b) loans or advances to officers, directors and employees of Holdings, any Intermediate Parentthe Company, the Borrower Borrowers and the Restricted Subsidiaries (i) for reasonable and customary business-related travel, entertainment, relocation and analogous ordinary business purposes, (ii) in connection with such Person’s purchase of Equity Interests in Holdings (or any direct or indirect parent thereof) (provided that the amount of such loans and advances made in cash to such Person shall be contributed to the Company or a Borrower in cash as common equity or Qualified Equity Interests) and (iii) for purposes not described in the foregoing clauses (i) and (ii); provided that at the time of incurrence thereof and after giving Pro Forma Effect thereto, the aggregate principal amount outstanding in reliance on this clause (iii) shall not exceed $1,000,000250,000,000;
(c) Investments by Holdings, any Intermediate Parent, the Company, any Borrower or any Restricted Subsidiary in any of Holdings, any Intermediate Parent, the Company, any Borrower or any Restricted Subsidiary; provided that, in the case of any Investment by a Loan Party in a Restricted Subsidiary that the aggregate outstanding amount is not a Loan Party, no Event of Investments made by Loan Parties in Restricted Subsidiaries that are not Loan Parties in reliance on this clause (c) Default shall not exceed the greater of $10,000,000 have occurred and 35% of Consolidated EBITDAbe continuing or would result therefrom;
(d) Investments consisting of prepayments to suppliers in the ordinary course of business;
(e) Investments consisting of extensions of trade credit in the ordinary course of business;
(f) Investments (i) existing or contemplated on the date hereof and set forth on Schedule 6.04(f) and any modification, replacement, renewal, reinvestment or extension thereof and (ii) Investments existing on the date hereof by Holdings, the Company, any Borrower or any Restricted Subsidiary in the Company, any Borrower or any Restricted Subsidiary and any modification, renewal or extension thereof; provided that the amount of the original Investment is not increased except by the terms of such Investment to the extent as set forth on Schedule 6.04(f) or as otherwise permitted by this Section 6.04;
(g) Investments in Swap Agreements permitted under Section 6.01(a)(vi)6.01;
(h) promissory notes and other non-cash consideration received in connection with Dispositions permitted by Section 6.05;
(i) Permitted Acquisitions;
(j) the Transactions (including, without limitation, (i) the designation of the Grandfathered Unrestricted Subsidiaries and (ii) the contribution of VMware common stock contemplated in the definition of “Grandfathered Unrestricted Subsidiaries”) and the Original Transactions;
(k) Investments in the ordinary course of business consisting of endorsements for collection or deposit and customary trade arrangements with customers consistent with past practices;
(l) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers and customers, from financially troubled account debtors or in settlement of delinquent obligations of, or other disputes with, customers and suppliers or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment;
(m) loans and advances to Holdings (or any direct or indirect parent thereof) or any Intermediate Parent in lieu of, and not in excess of the amount of (after giving effect to any other loans, advances or Restricted Payments in respect thereof), Restricted Payments to the extent permitted to be made to Holdings (or such parent) or such Intermediate Parent in accordance with Section 6.08(a);
(n) additional other Investments and other acquisitions; provided that at the time any such Investment or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition all Investments made in reliance on this clause (n), ) together with the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (n) (including the aggregate principal amount of all Indebtedness assumed in connection with any such other acquisition), shall not exceed the sum of (A) the greater of $18,000,000 3,750,000,000 and 6037.5% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Investment or other acquisition, plus (B) so long as immediately after giving effect to any such Investment no Event of Default under Section 7.01(a), (b), (h) or (i) has occurred and is continuing, the Available Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of such Investment, plus (C) the Available Equity Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of such Investment;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby;
(p) advances of payroll payments to employees in the ordinary course of business;
(qp) Investments and other acquisitions to the extent that payment for such Investments is made with Qualified Equity Interests (excluding Cure Amounts) of Holdings (or any direct or indirect parent thereof or the IPO Entitythereof); provided that (i) such amounts used pursuant to this clause (qp) shall not increase the Available Equity Amount or be applied to increase any other basket hereunder and (ii) any amounts used for such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof or the IPO Entitythereof) shall otherwise be permitted pursuant to this Section 6.04;
(rq) Investments of a Subsidiary acquired after the Effective Date or of a Person merged or consolidated with any Subsidiary in accordance with this Section and Section 6.03 after the Effective Date to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger or consolidation and were in existence on the date of such acquisition, merger or consolidation;
(sr) non-cash Investments in connection with tax planning and reorganization activities; provided that after giving effect to any such activities, the security interests of the Lenders in the Collateral, taken as a whole, would not be materially impaired;
(ts) Investments consisting of Liens, Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference to this Section 6.04(t6.04(s)) under Sections Section 6.01, 6.02, 6.03, 6.05 and 6.08, respectively, in each case, other than by reference to this Section 6.04(s);
(ut) additional Investments; provided that after giving effect to such Investment (A) on a Pro Forma Basis, the Total Net Leverage Ratio is less than or equal to 4.50 to 1.00 1.0 and (B) there is no continuing Event of Default;
(vu) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings the Company or the a Borrower;
(wv) to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Propertyintellectual property, or other rights, in each case in the ordinary course of business;
(w) Investments in Subsidiaries in the form of DFS Financing Assets, other receivables and related assets required in connection with a Permitted Receivables Financing (including the contribution or lending of cash and cash equivalents to Subsidiaries to finance the purchase of such assets from the Company, any Borrower or other Restricted Subsidiaries or to otherwise fund required reserves);
(x) DFS Financing Assets originated by the Company, any Borrower and/or the Subsidiaries;
(y) Investments by an Unrestricted Subsidiary entered into prior to the day such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to the definition of “Unrestricted Subsidiary”;
(yz) any Investment in a Similar Business; provided that at the time any such Investment is made, the aggregate outstanding amount of all Investments consisting made in reliance on this clause (z) together with the aggregate amount of purchases all consideration paid in connection with all other acquisitions made in reliance on this clause (z), shall not exceed the greater of assets of Franchisees (including, but not limited to, area development contracts owned by Franchisees) in the ordinary course of business or otherwise in an amount not exceeding $60,000,000, so long as (A) no Event of Default shall have occurred and be continuing $2,500,000,000 and (B) the Borrower is in pro forma compliance with the Financial Covenant after giving effect to any such purchase;
(z) So long as no Event of Default shall have occurred and be continuing, Investments in Franchisees (including, but not limited to, (i) Guarantees or other credit support of any Indebtedness and other liabilities thereof and (ii) loans, advances or contributions to the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater of $20,000,000 and 7025% of Consolidated EBITDA;EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Investment; and
(aa) Investments consisting of accounts and payment intangibles owing to the Borrower or any of the Restricted Subsidiaries from Franchiseesin Unrestricted Subsidiaries; provided that at the time any such obligation Investment is made, the aggregate outstanding amount of all Investments made in reliance on this clause (aa) together with the aggregate amount of all consideration paid in connection with all other acquisitions made in reliance on this clause (aa), shall be on not exceed the greater of (A) $1,250,000,000 and (B) 12.5% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such terms as the Borrower or the applicable Restricted Subsidiary establishes in good faith; and
(bb) Investments consisting of advances or expenditures by any Loan Party to, or on behalf of, any CMF Subsidiary in support of advertising and marketing programs in the ordinary course consistent with current practicesInvestment. For purposes of determining compliance with this Section 6.04, in the event that any item of a proposed Investment (or portion thereof) meets the criteria of more than one of the categories of Investments described in clauses (a) through (bbaa) above, Holdings shall, in its sole discretion, the Borrowers will be entitled to classify and reclassify or later divide, classify or reclassify (based on circumstances existing on the date of such reclassification) such Investment (or any portion thereof) and will only be required to include the amount and type of between such Investment clauses (a) through (aa), in one or more of the above clausesa manner that otherwise complies with this Section 6.04.
Appears in 1 contract
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor the any Borrower will, nor will they permit any Restricted Subsidiary or Intermediate Parent to, make or hold any Investment, except:
(a) Permitted Investments at the time such Permitted Investment is madeand cash;
(b) investments constituting the purchase or other acquisition (in one transaction or a series of related transactions) of all or substantially all of the property and assets or business of any Person or of assets constituting a business unit, a line of business or division of such Person, or the Equity Interests in a Person that, upon the consummation thereof, will be a Restricted Subsidiary if, after giving effect thereto on a Pro Forma Basis, the Borrowers would be in compliance with Sections 6.12 and 6.13; provided that the aggregate amount of cash consideration paid in respect of such investments (including in the form of loans or advances made to officers, directors and employees of Holdings, any Intermediate Parent, the Borrower and the Restricted Subsidiaries that are not Loan Parties) by Loan Parties involving the acquisition of Restricted Subsidiaries that do not become Loan Parties outstanding under this clause (b) at any time shall not exceed the greater of (i) for reasonable €100,000,000 and customary business-related travel, entertainment, relocation and analogous ordinary business purposes, (ii) in connection with such Person’s purchase 5.50% of Equity Interests in Holdings Consolidated Total Assets (or any direct or indirect parent thereof) (provided provided, that the amount of such loans and advances made in cash to such Person shall be contributed to the Borrower in cash as common equity or Qualified Equity Interests) and (iii) for purposes not described in the foregoing clauses (i) and (ii); provided that at the time of incurrence thereof and after giving Pro Forma Effect theretoextent such Restricted Subsidiaries do become Loan Parties, the aggregate principal amount outstanding in reliance on this clause (iiib) shall not exceed $1,000,000be reduced by the amount initially utilized);
(c) Investments by Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary in any of Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary; provided that the aggregate outstanding amount of Investments made by Loan Parties in Restricted Subsidiaries that are not Loan Parties in reliance on this clause (c) shall not exceed the greater of $10,000,000 and 35% of Consolidated EBITDA[reserved];
(d) Investments consisting existing on the Effective Date and to the extent having a principal amount in excess of prepayments to suppliers €5,000,000 individually or €10,000,000 in the ordinary course of business;
aggregate (eother than with respect to intercompany Investments) Investments consisting of extensions of trade credit in the ordinary course of business;
(f) Investments (i) existing or contemplated on the date hereof and set forth on Schedule 6.04(f) 6.04 and any modification, replacement, renewal, reinvestment or extension thereof thereof;
(e) Investments by Holdings in the Borrowers and by Holdings, the Borrowers and the Restricted Subsidiaries in Equity Interests of their respective Subsidiaries; provided that (i) any such Equity Interests held by a Loan Party in any other Loan Party shall be pledged to the extent required by the definition of the term “Collateral and Guarantee Requirement” and (ii) Investments existing the making of such Investment by any Loan Party in any Restricted Subsidiary that is not a Loan Party shall not, at the time such Investment is made and after giving effect thereto, cause the Non-Guarantor Debt and Investment Basket to be exceeded, provided that if any such investment under this subclause (ii) is made for the purpose of making an investment, loan or advance permitted under clause (u) of this Section, the amount available under this clause (e) shall not be reduced by the amount of any such investment, loan or advance which reduces the basket under clause (u) of this Section;
(f) loans or advances made by Holdings or any Borrower to any Restricted Subsidiary and made by any Restricted Subsidiary to any Borrower or any other Restricted Subsidiary; provided that (i) any such loans and advances made by a Loan Party shall be evidenced, on and after the date hereof Effective Date, by the Global Intercompany Note or other promissory notes reasonably acceptable to the Administrative Agent and (ii) the outstanding amount of such loans and advances made by Loan Parties to Restricted Subsidiaries that are not Loan Parties at the time such loans or advances are made, and after giving effect thereto, shall not cause the Non-Guarantor Debt and Investment Basket to be exceeded, provided that any intercompany loans or advances made by any Loan Party to any Restricted Subsidiary that is not a Loan Party using the proceeds of intercompany loans or advances received from Restricted Subsidiaries that are not Loan Parties no more than 120 days prior to making such intercompany loan or advance shall not be taken into account in the calculation of any restriction or basket set forth in this subclause (ii) (including the Non-Guarantor Debt and Investment Basket); provided further that if any such loan or advance under this subclause (ii) is made for the purpose of making an investment, loan or advance permitted under clause (u) of this Section, the amount available under this clause (f) shall not be reduced by the amount of any such investment, loan or advance which reduces the basket under clause (u) of this Section, provided further that any loan or advance made by any Loan Party to a Restricted Subsidiary that is not a Loan Party, for the purposes of calculating usage under this subclause (ii) and the Non-Guarantor Debt and Investment Basket, shall be reduced euro-for-euro (or other applicable currency) by any amounts owed by such Loan Party to such Restricted Subsidiary that is not a Loan Party;
(g) Guarantees by Holdings, the Borrower or any Restricted Subsidiary in respect of Indebtedness permitted under Section 6.01 and in respect of other obligations not otherwise contemplated by this Section 6.04, in each case of Holdings, any Borrower or any Restricted Subsidiary; provided that any such Guarantees of Indebtedness and such other obligations, in each case of Restricted Subsidiaries that are not Loan Parties by any Loan Party shall not, at the time any such Guarantee is provided and after giving effect thereto, cause the Non-Guarantor Debt and Investment Basket to be exceeded;
(h) loans or advances to directors, officers, consultants or employees of Holdings, any Borrower or any Restricted Subsidiary and any modification, renewal or extension thereof; provided that the amount of the original Investment is not increased except by the terms of such Investment to the extent as set forth on Schedule 6.04(f) or as otherwise permitted by this Section 6.04;
(g) Investments in Swap Agreements permitted under Section 6.01(a)(vi);
(h) promissory notes and other non-cash consideration received in connection with Dispositions permitted by Section 6.05;
(i) Permitted Acquisitions;
(j) the Transactions;
(k) Investments made in the ordinary course of business consisting of endorsements for collection Holdings, such Borrower or deposit and customary trade arrangements with customers consistent with past practicessuch Restricted Subsidiary, as applicable, not exceeding €10,000,000 in the aggregate outstanding at any time (determined without regard to any write-downs or write-offs of such loans or advances);
(li) Investments payroll, travel and similar advances to cover matters that are expected at the time of such advances ultimately to be treated as expenses of Holdings, any Borrower or any Restricted Subsidiary for accounting purposes and that are made in the ordinary course of business;
(including debt obligations and Equity Interestsj) investments received in connection with the bankruptcy or reorganization of suppliers and customersof, from financially troubled account debtors or in settlement of delinquent obligations of, or other accounts and disputes with, customers and suppliers or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment;
(m) loans and advances to Holdings (or any direct or indirect parent thereof) or any Intermediate Parent in lieu of, and not in excess of the amount of (after giving effect to any other loans, advances or Restricted Payments in respect thereof), Restricted Payments to the extent permitted to be made to Holdings (or such parent) or such Intermediate Parent in accordance with Section 6.08(a);
(n) additional Investments and other acquisitions; provided that at the time any such Investment or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition made in reliance on this clause (n), together with the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (n), shall not exceed the sum of (A) the greater of $18,000,000 and 60% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Investment or other acquisition, plus (B) so long as no Event of Default has occurred and is continuing, the Available Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of such Investment;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby;
(p) advances of payroll payments to employees in the ordinary course of business;
(q) Investments and other acquisitions to the extent that payment for such Investments is made with Qualified Equity Interests (excluding Cure Amounts) of Holdings (or any direct or indirect parent thereof or the IPO Entity); provided that (i) such amounts used pursuant to this clause (q) shall not increase the Available Amount and (ii) any amounts used for such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof or the IPO Entity) shall otherwise be permitted pursuant to this Section 6.04;
(r) Investments of a Subsidiary acquired after the Effective Date or of a Person merged or consolidated with any Subsidiary in accordance with this Section and Section 6.03 after the Effective Date to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger or consolidation and were in existence on the date of such acquisition, merger or consolidation;
(s) non-cash Investments in connection with tax planning and reorganization activities; provided that after giving effect to any such activities, the security interests of the Lenders in the Collateral, taken as a whole, would not be materially impaired;
(t) Investments consisting of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference to this Section 6.04(t)) under Sections 6.01, 6.02, 6.03, 6.05 and 6.08, respectively;
(u) additional Investments; provided that after giving effect to such Investment (A) on a Pro Forma Basis, the Total Net Leverage Ratio is less than or equal to 4.50 to 1.00 and (B) there is no continuing Event of Default;
(v) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the Borrower;
(w) to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Property, or other rights, in each case in the ordinary course of business;
(xk) Investments investments in the form of Hedging Agreements permitted by an Unrestricted Subsidiary entered into prior Section 6.07 (including any Back to Back Arrangements);
(l) investments of any Person existing at the day time such Unrestricted Subsidiary is redesignated as Person becomes a Restricted Subsidiary pursuant to or consolidates or merges with any Borrower or any Restricted Subsidiary so long as such investments were not made in contemplation of such Person becoming a Restricted Subsidiary or of such consolidation or merger;
(m) investments resulting from pledges or deposits described in clause (c) or (d) of the definition of the term “Unrestricted SubsidiaryPermitted Encumbrance”;
(yn) Investments consisting investments made as a result of purchases the receipt of assets noncash consideration from a sale, transfer, lease or other disposition of Franchisees any asset in compliance with Section 6.05;
(includingo) investments that result solely from the receipt by Holdings, any Borrower or any Restricted Subsidiary from any of its Subsidiaries of a dividend or other Restricted Payment in the form of Equity Interests, evidences of Indebtedness or other securities (but not limited to, area development contracts owned by Franchiseesany additions thereto made after the date of the receipt thereof);
(p) receivables or other trade payables owing to a Borrower or a Restricted Subsidiary if created or acquired in the ordinary course of business and payable or otherwise dischargeable in an amount not exceeding $60,000,000, so long as (A) no Event of Default shall have occurred and be continuing and (B) the Borrower is in pro forma compliance accordance with the Financial Covenant after giving effect to any such purchase;
(z) So long as no Event of Default shall have occurred and be continuing, Investments in Franchisees (including, but not limited to, (i) Guarantees or other credit support of any Indebtedness and other liabilities thereof and (ii) loans, advances or contributions to the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater of $20,000,000 and 70% of Consolidated EBITDA;
(aa) Investments consisting of accounts and payment intangibles owing to the Borrower or any of the Restricted Subsidiaries from Franchiseescustomary trade terms; provided that such obligation shall be on trade terms may include such concessionary trade terms as the any Borrower or the applicable any Restricted Subsidiary establishes in good faithdeems reasonable under the circumstances; and
(bbq) Investments consisting of advances or expenditures by mergers and consolidations permitted under Section 6.03 that do not involve any Loan Party toPerson other than Holdings, or on behalf of, any CMF Subsidiary in support of advertising the Borrowers and marketing programs in the ordinary course consistent with current practices. For purposes of determining compliance with this Section 6.04, in the event Restricted Subsidiaries that any item of Investment meets the criteria of more than one of the categories of Investments described in clauses (a) through (bb) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such Investment (or any portion thereof) and will only be required to include the amount and type of such Investment in one or more of the above clauses.are wholly owned Restricted Subsidiaries;
Appears in 1 contract
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor the The Borrower willwill not, nor and will they not permit any Restricted Subsidiary to, (x) purchase, hold or Intermediate Parent toacquire any Equity Interests, evidences of indebtedness or other securities (including any option, warrant or other right to acquire any of the foregoing) of, make or hold permit to exist any loans or advances or capital contributions to, Guarantee any obligations of, or make or permit to exist any other investment or any other interest in, any other Person, or (y) consummate any Acquisition (each, an “Investment”), except:
(a) Permitted Investments at the time such Permitted Investment is made;
(b) loans or advances to officers, directors and employees of Holdings, any Intermediate Parent, the Borrower and the Restricted Subsidiaries (i) for reasonable and customary business-related travel, entertainment, relocation and analogous ordinary business purposes, (ii) in connection with such Person’s purchase of Equity Interests in Holdings (or any direct or indirect parent thereof) (provided that the amount of such loans and advances made in cash to such Person shall be contributed to the Borrower in cash as common equity or Qualified Equity Interests) and (iii) for purposes not described in the foregoing clauses (i) and (ii); provided that at the time of incurrence thereof and after giving Pro Forma Effect thereto, the aggregate principal amount outstanding in reliance on this clause (iii) shall not exceed $1,000,000;
(c) Investments by Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary in any of Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary; provided that the aggregate outstanding amount of Investments made by Loan Parties in Restricted Subsidiaries that are not Loan Parties in reliance on this clause (c) shall not exceed the greater of $10,000,000 and 35% of Consolidated EBITDA;
(d) Investments consisting of prepayments to suppliers in the ordinary course of business;
(e) Investments consisting of extensions of trade credit in the ordinary course of business;
(f) Investments (i) existing or contemplated on the date hereof and set forth on in Schedule 6.04(f) 6.04 and any modification, replacement, renewal, reinvestment or extension thereof and (ii) Investments existing on the date hereof by Holdings, the Borrower or any Restricted Subsidiary in the Borrower or any Restricted Subsidiary and any modification, renewal or extension thereof; provided that the amount of the original Investment is not increased except by the terms of such original Investment to the extent as set forth on Schedule 6.04(f) or as otherwise permitted by this Section 6.04);
(b) Investments in cash and Cash Equivalent Investments;
(c) Investments (i) by the Loan Parties in the Equity Interests of their respective Subsidiaries that are Loan Parties and in the Broker-Dealer Subsidiaries, (ii) by any Broker-Dealer Subsidiary in the Equity Interests of its Subsidiaries that are Loan Parties, or (iii) made by (v) any Broker-Dealer Subsidiary to another Broker-Dealer Subsidiary, (w) any Immaterial Subsidiary in any other Immaterial Subsidiary, (x) any Loan Party to any other Loan Party, (y) any Subsidiary that is not a Loan Party to any Loan Party so long as such Investments, to the extent constituting loans or advances, are subordinated in right of payment to the Obligations on terms reasonably acceptable to the Administrative Agent, or (z) any Subsidiary (other than a Broker-Dealer Subsidiary) that is not a Loan Party to any other Subsidiary that is not a Loan Party;
(d) Investments (i) by the Loan Parties in the Equity Interests of their respective subsidiaries that are not Loan Parties, (ii) by Subsidiaries that are not Loan Parties in the Equity Interests of their respective Subsidiaries, or (iii) consisting of loans or advances made by any Loan Party or any Broker-Dealer Subsidiary to any Subsidiary that is not a Loan Party, in an aggregate amount for all Investments covered by this clause (d) not to exceed the greater of (i) $50,000,000 and (ii) 15% of Consolidated Net Tangible Assets (measured as of the date of each Investment) at any time (as such amount is reduced by Guarantees permitted under the proviso to Section 6.01(d));
(e) Guarantees constituting Indebtedness permitted by Section 6.01;
(f) Guarantees under the Guarantee Agreement;
(g) Investments in Swap Agreements permitted under Section 6.01(a)(vi)Guarantees (i) by a Loan Party of obligations (other than Indebtedness, which Guarantees are addressed by clause (e) above) of any Loan Party, or (ii) by any Subsidiary that is not a Loan Party of obligations (other than Indebtedness, which Guarantees are addressed by clause (e) above) of the Borrower or any other Subsidiary, provided, however, that a Broker-Dealer Subsidiary may not Guarantee the obligations of any Subsidiary that is not a Loan Party or a Broker-Dealer Subsidiary;
(h) promissory notes Investments in and other non-cash consideration received in connection with Dispositions obligations under Swap Agreements permitted by Section 6.05;
(i) Permitted Acquisitions;
Investments consisting of (ji) the Transactions;
(k) Investments endorsements of negotiable instruments and other payment items for collection or deposit in the ordinary course of business and (ii) lease, utility or other similar deposits in the ordinary course of business;
(j) Investments consisting of endorsements loans or advances to directors, officers, employees, managers or consultants in the ordinary course of business, in an aggregate amount for collection or deposit all such loans and customary trade arrangements with customers consistent with past practicesadvances not to exceed the greater of (i) $2,000,000 and (ii) 1.0% of Consolidated Net Tangible Assets (measured as of the time of each Investment) at any time outstanding;
(k) Permitted Acquisitions;
(l) extensions of trade credit or the holding of receivables in the ordinary course of business and Investments received in satisfaction or partial satisfaction thereof from financially troubled account debtors and other credits to suppliers in the ordinary course of business;
(including debt obligations and Equity Interestsm) Investments received in connection with the workout, bankruptcy or reorganization of suppliers and customersof, from financially troubled account debtors insolvency or in settlement of delinquent obligations liquidation of, or other settlement of claims against and delinquent accounts of and disputes with, customers and suppliers suppliers, or as security for any such claims, accounts and disputes, or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment;
(m) loans and advances to Holdings (or any direct or indirect parent thereof) or any Intermediate Parent in lieu of, and not in excess of the amount of (after giving effect to any other loans, advances or Restricted Payments in respect thereof), Restricted Payments to the extent permitted to be made to Holdings (or such parent) or such Intermediate Parent in accordance with Section 6.08(a);
(n) additional Investments consisting of promissory notes and other acquisitions; provided that at deferred payment obligations and noncash consideration delivered as the time any purchase consideration for a Disposition permitted by Section 6.03, so long as such Investment or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition made in reliance on this clause (n), together with the aggregate amount of all consideration paid in connection with all other Investments notes and acquisitions made in reliance on this clause (n), shall deferred payment obligations do not exceed the sum greater of (Ai) the greater of $18,000,000 25,000,000 and 60(ii) 7.5% of Consolidated EBITDA for Net Tangible Assets (measured as of the most recently ended Test Period after giving Pro Forma Effect to the making date of such Investment or other acquisition, plus (B) so long as no Event of Default has occurred and is continuing, the Available Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of each such Investment) in the aggregate, net of recoveries and distributions thereon received in cash by any Loan Party, at any time outstanding;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated therebyInvestments consisting of obligations under Swap Agreements permitted by Section 6.05;
(p) advances Investments consisting of payroll payments to employees in the ordinary course of businessRestricted Payments permitted by Section 6.06;
(q) Investments and other acquisitions to the extent of any Person that payment for such Investments is made with Qualified Equity Interests (excluding Cure Amounts) of Holdings becomes (or any direct is merged or indirect parent thereof consolidated or amalgamated with) a Subsidiary of the IPO Entity)Borrower on or after the date hereof on the date such Person becomes (or is merged or consolidated or amalgamated with) a Subsidiary of the Borrower; provided that (i) such amounts used pursuant to this clause Investments exist at the time such Person becomes (qor is merged or consolidated or amalgamated with) shall not increase the Available Amount a Subsidiary, and (ii) any amounts used for such an Investment or other acquisition that Investments are not Qualified Equity Interests made in anticipation or contemplation of Holdings such Person becoming (or any direct merging or indirect parent thereof consolidating or the IPO Entityamalgamated with) shall otherwise be permitted pursuant to this Section 6.04a Subsidiary;
(r) Investments consisting of a Subsidiary acquired after the Effective Date or of a Person merged or consolidated with any Subsidiary good faith deposits made in accordance with this Section and Section 6.03 after clause (g) of the Effective Date to the extent that such Investments were not made in contemplation definition of or in connection with such acquisition, merger or consolidation and were in existence on the date of such acquisition, merger or consolidationPermitted Encumbrances;
(s) non-cash Investments (including in connection with tax planning the form of intercompany loans) made by the Borrower or any Subsidiary in their respective direct and reorganization activitiesindirect equity holders in lieu of paying such cash as a Restricted Payment permitted by Section 6.06; provided that after the aggregate amount of such Investments (valued as of the date made) shall not exceed the amount that would have otherwise been permitted as a Restricted Payment in cash pursuant to Section 6.06 (without giving effect to any the proviso at the end of such activities, the security interests of the Lenders in the Collateral, taken as a whole, would not be materially impaired;
Section); (t) in addition to Investments consisting of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments otherwise permitted (other than by reference to this Section 6.04(t)) under Sections 6.01, 6.02, 6.03, 6.05 and 6.08, respectively;
(u) additional Investments; provided that after giving effect to such Investment (A) on a Pro Forma Basis, the Total Net Leverage Ratio is less than or equal to 4.50 to 1.00 and (B) there is no continuing Event of Default;
(v) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the Borrower;
(w) to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Property, or other rights, in each case in the ordinary course of business;
(x) Investments by an Unrestricted Subsidiary entered into prior to the day such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to the definition of “Unrestricted Subsidiary”;
(y) Investments consisting of purchases of assets of Franchisees (including, but not limited to, area development contracts owned by Franchisees) in the ordinary course of business or otherwise in an amount not exceeding $60,000,000, so long as (A) no Event of Default shall have occurred and be continuing and (B) the Borrower is in pro forma compliance with the Financial Covenant after giving effect to any such purchase;
(z) So long as no Event of Default shall have occurred and be continuingSection, Investments in Franchisees (includingan aggregate amount not to exceed, but not limited to, the greater of (i) Guarantees or other credit support of any Indebtedness and other liabilities thereof $35,000,000 and (ii) loans, advances or contributions to the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater of $20,000,000 and 7010% of Consolidated EBITDA;
Net Tangible Assets (aa) Investments consisting of accounts and payment intangibles owing to the Borrower or any measured as of the Restricted Subsidiaries from Franchisees; provided that such obligation shall be on such terms as the Borrower or the applicable Restricted Subsidiary establishes in good faith; and
(bb) Investments consisting date of advances or expenditures by any Loan Party to, or on behalf of, any CMF Subsidiary in support of advertising and marketing programs in the ordinary course consistent with current practices. For purposes of determining compliance with this Section 6.04, in the event that any item of Investment meets the criteria of more than one of the categories of Investments described in clauses (a) through (bb) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such Investment (or any portion thereof) and will only be required to include the amount and type of such Investment in one or more of the above clauses.each Investment);
Appears in 1 contract
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor the The Borrower willwill not, nor and will they not permit any Restricted Subsidiary to, (x) purchase, hold or Intermediate Parent toacquire any Equity Interests, evidences of indebtedness or other securities (including any option, warrant or other right to acquire any of the foregoing) of, make or hold permit to exist any loans or advances or capital contributions to, Guarantee any obligations of, or make or permit to exist any other investment or any other interest in, any other Person, or (y) consummate any Acquisition (each, an “Investment”), except:
(a) Permitted Investments at the time such Permitted Investment is made;
(b) loans or advances to officers, directors and employees of Holdings, any Intermediate Parent, the Borrower and the Restricted Subsidiaries (i) for reasonable and customary business-related travel, entertainment, relocation and analogous ordinary business purposes, (ii) in connection with such Person’s purchase of Equity Interests in Holdings (or any direct or indirect parent thereof) (provided that the amount of such loans and advances made in cash to such Person shall be contributed to the Borrower in cash as common equity or Qualified Equity Interests) and (iii) for purposes not described in the foregoing clauses (i) and (ii); provided that at the time of incurrence thereof and after giving Pro Forma Effect thereto, the aggregate principal amount outstanding in reliance on this clause (iii) shall not exceed $1,000,000;
(c) Investments by Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary in any of Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary; provided that the aggregate outstanding amount of Investments made by Loan Parties in Restricted Subsidiaries that are not Loan Parties in reliance on this clause (c) shall not exceed the greater of $10,000,000 and 35% of Consolidated EBITDA;
(d) Investments consisting of prepayments to suppliers in the ordinary course of business;
(e) Investments consisting of extensions of trade credit in the ordinary course of business;
(f) Investments (i) existing or contemplated on the date hereof and set forth on in Schedule 6.04(f) 6.04 and any modification, replacement, renewal, reinvestment or extension thereof and (ii) Investments existing on the date hereof by Holdings, the Borrower or any Restricted Subsidiary in the Borrower or any Restricted Subsidiary and any modification, renewal or extension thereof; provided that the amount of the original Investment is not increased except by the terms of such original Investment to the extent as set forth on Schedule 6.04(f) or as otherwise permitted by this Section 6.04);
(b) Investments in Cash and Cash Equivalent Investments;
(c) Investments (i) by the Loan Parties in the Equity Interests of their respective Subsidiaries that are Loan Parties and in the Broker-Dealer Subsidiaries, (ii) by any Broker-Dealer Subsidiary in the Equity Interests of its Subsidiaries that are Loan Parties, or (iii) made by (v) any Broker-Dealer Subsidiary to another Broker-Dealer Subsidiary, (w) any Immaterial Subsidiary in any other Immaterial Subsidiary, (x) any Loan Party to any other Loan Party, (y) any Subsidiary that is not a Loan Party to any Loan Party so long as such Investments, to the extent constituting loans or advances, are subordinated in right of payment to the Obligations on terms reasonably acceptable to the Administrative Agent, or (z) any Subsidiary (other than a Broker-Dealer Subsidiary) that is not a Loan Party to any other Subsidiary that is not a Loan Party;
(d) Investments (i) by the Loan Parties in the Equity Interests of their respective subsidiaries that are not Loan Parties, (ii) by Subsidiaries that are not Loan Parties in the Equity Interests of their respective Subsidiaries, or (iii) consisting of loans or advances made by any Loan Party or any Broker-Dealer Subsidiary to any Subsidiary that is not a Loan Party, in an aggregate amount for all Investments covered by this clause (d) not to exceed the greater of (i) $50,000,000 and (ii) 15% of Consolidated Net Tangible Assets (measured as of the date of each Investment) at any time (as such amount is reduced by Guarantees permitted under the proviso to Section 6.01(d));
(e) Guarantees constituting Indebtedness permitted by Section 6.01;
(f) Guarantees under the Guarantee Agreement;
(g) Investments in Swap Agreements permitted under Section 6.01(a)(vi)Guarantees (i) by a Loan Party of obligations (other than Indebtedness, which Guarantees are addressed by clause (e) above) of any Loan Party, or (ii) by any Subsidiary that is not a Loan Party of obligations (other than Indebtedness, which Guarantees are addressed by clause (e) above) of the Borrower or any other Subsidiary, provided, however, that a Broker-Dealer Subsidiary may not Guarantee the obligations of any Subsidiary that is not a Loan Party or a Broker-Dealer Subsidiary;
(h) promissory notes Investments in and other non-cash consideration received in connection with Dispositions obligations under Swap Agreements permitted by Section 6.05;
(i) Permitted Acquisitions;
Investments consisting of (ji) the Transactions;
(k) Investments endorsements of negotiable instruments and other payment items for collection or deposit in the ordinary course of business and (ii) lease, utility or other similar deposits in the ordinary course of business;
(j) Investments consisting of endorsements loans or advances to directors, officers, employees, managers or consultants in the ordinary course of business, in an aggregate amount for collection or deposit all such loans and customary trade arrangements with customers consistent with past practicesadvances not to exceed the greater of (i) $2,000,000 and (ii) 1.0% of Consolidated Net Tangible Assets (measured as of the time of each Investment) at any time outstanding;
(k) Permitted Acquisitions;
(l) extensions of trade credit or the holding of receivables in the ordinary course of business and Investments received in satisfaction or partial satisfaction thereof from financially troubled account debtors and other credits to suppliers in the ordinary course of business;
(including debt obligations and Equity Interestsm) Investments received in connection with the workout, bankruptcy or reorganization of suppliers and customersof, from financially troubled account debtors insolvency or in settlement of delinquent obligations liquidation of, or other settlement of claims against and delinquent accounts of and disputes with, customers and suppliers suppliers, or as security for any such claims, accounts and disputes, or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment;
(m) loans and advances to Holdings (or any direct or indirect parent thereof) or any Intermediate Parent in lieu of, and not in excess of the amount of (after giving effect to any other loans, advances or Restricted Payments in respect thereof), Restricted Payments to the extent permitted to be made to Holdings (or such parent) or such Intermediate Parent in accordance with Section 6.08(a);
(n) additional Investments consisting of promissory notes and other acquisitions; provided that at deferred payment obligations and noncash consideration delivered as the time any purchase consideration for a Disposition permitted by Section 6.03, so long as such Investment or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition made in reliance on this clause (n), together with the aggregate amount of all consideration paid in connection with all other Investments notes and acquisitions made in reliance on this clause (n), shall deferred payment obligations do not exceed the sum greater of (Ai) the greater of $18,000,000 25,000,000 and 60(ii) 7.5% of Consolidated EBITDA for Net Tangible Assets (measured as of the most recently ended Test Period after giving Pro Forma Effect to the making date of such Investment or other acquisition, plus (B) so long as no Event of Default has occurred and is continuing, the Available Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of each such Investment) in the aggregate, net of recoveries and distributions thereon received in cash by any Loan Party, at any time outstanding;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated therebyInvestments consisting of obligations under Swap Agreements permitted by Section 6.05;
(p) advances Investments consisting of payroll payments to employees in the ordinary course of businessRestricted Payments permitted by Section 6.06;
(q) Investments and other acquisitions to the extent of any Person that payment for such Investments is made with Qualified Equity Interests (excluding Cure Amounts) of Holdings becomes (or any direct is merged or indirect parent thereof consolidated or amalgamated with) a Subsidiary of the IPO Entity)Borrower on or after the date hereof on the date such Person becomes (or is merged or consolidated or amalgamated with) a Subsidiary of the Borrower; provided that (i) such amounts used pursuant to this clause Investments exist at the time such Person becomes (qor is merged or consolidated or amalgamated with) shall not increase the Available Amount a Subsidiary, and (ii) any amounts used for such an Investment or other acquisition that Investments are not Qualified Equity Interests made in anticipation or contemplation of Holdings such Person becoming (or any direct merging or indirect parent thereof consolidating or the IPO Entityamalgamated with) shall otherwise be permitted pursuant to this Section 6.04a Subsidiary;
(r) Investments consisting of a Subsidiary acquired after the Effective Date or of a Person merged or consolidated with any Subsidiary good faith deposits made in accordance with this Section and Section 6.03 after clause (g) of the Effective Date to the extent that such Investments were not made in contemplation definition of or in connection with such acquisition, merger or consolidation and were in existence on the date of such acquisition, merger or consolidationPermitted Encumbrances;
(s) non-cash Investments (including in connection with tax planning the form of intercompany loans) made by the Borrower or any Subsidiary in their respective direct and reorganization activitiesindirect equity holders in lieu of paying such cash as a Restricted Payment permitted by Section 6.06; provided that after the aggregate amount of such Investments (valued as of the date made) shall not exceed the amount that would have otherwise been permitted as a Restricted Payment in cash pursuant to Section 6.06 (without giving effect to any the proviso at the end of such activities, the security interests of the Lenders in the Collateral, taken as a whole, would not be materially impaired;
Section); (t) in addition to Investments consisting of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments otherwise permitted (other than by reference to this Section 6.04(t)) under Sections 6.01, 6.02, 6.03, 6.05 and 6.08, respectively;
(u) additional Investments; provided that after giving effect to such Investment (A) on a Pro Forma Basis, the Total Net Leverage Ratio is less than or equal to 4.50 to 1.00 and (B) there is no continuing Event of Default;
(v) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the Borrower;
(w) to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Property, or other rights, in each case in the ordinary course of business;
(x) Investments by an Unrestricted Subsidiary entered into prior to the day such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to the definition of “Unrestricted Subsidiary”;
(y) Investments consisting of purchases of assets of Franchisees (including, but not limited to, area development contracts owned by Franchisees) in the ordinary course of business or otherwise in an amount not exceeding $60,000,000, so long as (A) no Event of Default shall have occurred and be continuing and (B) the Borrower is in pro forma compliance with the Financial Covenant after giving effect to any such purchase;
(z) So long as no Event of Default shall have occurred and be continuingSection, Investments in Franchisees (includingan aggregate amount not to exceed, but not limited to, the greater of (i) Guarantees or other credit support of any Indebtedness and other liabilities thereof $35,000,000 and (ii) loans, advances or contributions to the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater of $20,000,000 and 7010% of Consolidated EBITDA;
Net Tangible Assets (aa) Investments consisting of accounts and payment intangibles owing to the Borrower or any measured as of the Restricted Subsidiaries from Franchisees; provided that such obligation shall be on such terms as the Borrower or the applicable Restricted Subsidiary establishes in good faith; and
(bb) Investments consisting date of advances or expenditures by any Loan Party to, or on behalf of, any CMF Subsidiary in support of advertising and marketing programs in the ordinary course consistent with current practices. For purposes of determining compliance with this Section 6.04, in the event that any item of Investment meets the criteria of more than one of the categories of Investments described in clauses (a) through (bb) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such Investment (or any portion thereof) and will only be required to include the amount and type of such Investment in one or more of the above clauses.each Investment);
Appears in 1 contract
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor the The Borrower willwill not, nor and will they not permit any Restricted Subsidiary or Intermediate Parent of the Subsidiaries to, make any Investment in, or hold Guarantee any Investmentobligations of, any other Person, or purchase or otherwise acquire (in one transaction or a series of transactions) any assets of any other Person constituting a business unit, except:
(ai) Permitted Investments at the time such Permitted Investment is madeInvestments;
(bii) loans or advances to officers, directors and employees Investments of Holdings, any Intermediate Parentthe Borrower, the Borrower and the Restricted Subsidiaries (i) for reasonable and customary business-related travel, entertainment, relocation and analogous ordinary business purposes, (ii) in connection with such Person’s purchase of Equity Interests in Holdings (or any direct or indirect parent thereof) (provided that the amount of such loans and advances made in cash to such Person shall be contributed to the Borrower in cash as common equity or Qualified Equity Interests) and (iii) for purposes not described in the foregoing clauses (i) and (ii); provided that at the time of incurrence thereof and after giving Pro Forma Effect thereto, the aggregate principal amount outstanding in reliance on this clause (iii) shall not exceed $1,000,000;
(c) Investments by Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary in any of Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary; provided that the aggregate outstanding amount of Investments made by Loan Parties in Restricted Subsidiaries that are not Loan Parties in reliance on this clause (c) shall not exceed the greater of $10,000,000 and 35% of Consolidated EBITDA;
(d) Investments consisting of prepayments to suppliers in the ordinary course of business;
(e) Investments consisting of extensions of trade credit in the ordinary course of business;
(f) Investments (i) existing or contemplated on the date hereof Holdings and its subsidiaries set forth on Schedule 6.04(f) and any modification, replacement, renewal, reinvestment or extension thereof and (ii) Investments existing on the date hereof by Holdings, the Borrower or any Restricted Subsidiary in the Borrower or any Restricted Subsidiary and any modification, renewal or extension thereof; provided that the amount of the original Investment is not increased except by the terms of such Investment to the extent as set forth on Schedule 6.04(f) or as otherwise permitted by this Section 6.04;
(giii) Investments in Swap Agreements Guarantees of Indebtedness and/or Guarantees consisting of Indebtedness permitted under by Section 6.01(a)(vi)6.01;
(h) promissory notes and other non-cash consideration received in connection with Dispositions permitted by Section 6.05;
(i) Permitted Acquisitions;
(j) the Transactions;
(kiv) Investments in the ordinary course of business consisting of endorsements for collection or deposit and customary trade arrangements with customers consistent with past practices;
(l) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers and customersof, from financially troubled account debtors or in settlement of delinquent obligations of, or other accounts and disputes with, customers and suppliers or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment;
(m) loans and advances to Holdings (or any direct or indirect parent thereof) or any Intermediate Parent in lieu of, and not in excess of the amount of (after giving effect to any other loans, advances or Restricted Payments in respect thereof), Restricted Payments to the extent permitted to be made to Holdings (or such parent) or such Intermediate Parent in accordance with Section 6.08(a);
(n) additional Investments and other acquisitions; provided that at the time any such Investment or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition made in reliance on this clause (n), together with the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (n), shall not exceed the sum of (A) the greater of $18,000,000 and 60% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Investment or other acquisition, plus (B) so long as no Event of Default has occurred and is continuing, the Available Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of such Investment;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby;
(p) advances of payroll payments to employees in the ordinary course of business;
(q) Investments and other acquisitions to the extent that payment for such Investments is made with Qualified Equity Interests (excluding Cure Amounts) of Holdings (or any direct or indirect parent thereof or the IPO Entity); provided that (i) such amounts used pursuant to this clause (q) shall not increase the Available Amount and (ii) any amounts used for such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof or the IPO Entity) shall otherwise be permitted pursuant to this Section 6.04;
(r) Investments of a Subsidiary acquired after the Effective Date or of a Person merged or consolidated with any Subsidiary in accordance with this Section and Section 6.03 after the Effective Date to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger or consolidation and were in existence on the date of such acquisition, merger or consolidation;
(s) non-cash Investments in connection with tax planning and reorganization activities; provided that after giving effect to any such activities, the security interests of the Lenders in the Collateral, taken as a whole, would not be materially impaired;
(t) Investments consisting of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference to this Section 6.04(t)) under Sections 6.01, 6.02, 6.03, 6.05 and 6.08, respectively;
(u) additional Investments; provided that after giving effect to such Investment (A) on a Pro Forma Basis, the Total Net Leverage Ratio is less than or equal to 4.50 to 1.00 and (B) there is no continuing Event of Default;
(v) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the Borrower;
(w) to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Property, or other rightssuppliers, in each case in the ordinary course of business;
(v) Investments by the Borrower or any Subsidiary Loan Party in Subsidiary Loan Parties; provided that the Borrower and such Subsidiary Loan Party, as the case may be, shall comply with the applicable provisions of Section 5.11 with respect to any newly formed Subsidiary;
(vi) Investments consisting of non-cash consideration received in connection with any Asset Sale permitted by Section 6.05;
(vii) Investments by the Subsidiaries in the Borrower; provided that the proceeds of such Investments are used for a purpose set forth in Section 5.10(b);
(viii) [intentionally omitted];
(ix) usual and customary loans and advances to employees, officers and directors of the Borrower and the Subsidiaries;
(x) Investments by an Unrestricted Subsidiary entered into prior to the day such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to Borrower or any of the definition of “Unrestricted Subsidiary”;
(y) Investments consisting of purchases of assets of Franchisees (including, but not limited to, area development contracts owned by Franchisees) Subsidiaries in the ordinary course of business or otherwise Joint Ventures in an amount not exceeding to exceed $60,000,000, so long as 15,000,000 in the aggregate in any fiscal year of the Borrower;
(xi) Investments in charitable foundations organized under Section 501(c) of the Code in an amount not to exceed $7,500,000 in the aggregate in any calendar year;
(xii) any Investment consisting of a Hedging Agreement permitted by Section 6.07;
(xiii) Business Acquisitions and Investments that are not otherwise permitted under any other provision of this Section 6.04; provided that (A) at the time of such Business Acquisition or Investment no Event of Default shall have has occurred and be is continuing or would result therefrom and (B) the Borrower is in pro forma compliance with the Financial Covenant immediately after giving effect to any such purchaseBusiness Acquisition or Investment, (1) the Revolver Availability is greater than $250,000,000 and (2) the Consolidated Fixed Charge Coverage Ratio for the period of four consecutive fiscal quarters most recently ended on or prior to the date of such Business Acquisition or Investment, calculated on a pro forma basis as if such Business Acquisition or Investment (and any related incurrence of Indebtedness) were made on the first day of such period, shall not be less than 1.10 to 1.00;
(z) So long as no Event of Default shall have occurred and be continuing, Investments in Franchisees (including, but not limited to, (i) Guarantees or other credit support of any Indebtedness and other liabilities thereof and (ii) loans, advances or contributions to the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater of $20,000,000 and 70% of Consolidated EBITDA;
(aaxiv) Investments consisting of accounts Sellers’ Retained Interests in Securitizations permitted by Sections 6.01 and payment intangibles owing to the Borrower or any of the Restricted Subsidiaries from Franchisees; provided that such obligation shall be on such terms as the Borrower or the applicable Restricted Subsidiary establishes in good faith6.05; and
(bbA) Investments consisting of advances by the Borrower or expenditures by any Loan Party to, or on behalf of, any CMF a Subsidiary in support connection with a Securitization permitted pursuant to this Agreement and (B) any Investment or other Guarantee that may be deemed made by the Borrower due to the fact that a Parent Undertaking has been entered into in respect of advertising and marketing programs in a Securitization permitted pursuant to the ordinary course consistent with current practices. For purposes of determining compliance with this Section 6.04, in the event that any item of Investment meets the criteria of more than one of the categories of Investments described in clauses (a) through (bb) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such Investment (or any portion thereof) and will only be required to include the amount and type of such Investment in one or more of the above clausesAgreement.
Appears in 1 contract
Samples: Credit Agreement (Rite Aid Corp)
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor the Borrower No Specified Loan Party will, nor or will they permit any Restricted Subsidiary or any Intermediate Parent to, make or hold any Investment, except:
(a) Permitted Investments at the time such Permitted Investment is madecash and Cash Equivalents;
(b) loans or advances to officers, directors and employees of Holdings, any Intermediate Parent, the Borrower Holdings and the its Restricted Subsidiaries (i) for reasonable and customary business-related travel, entertainment, relocation and analogous ordinary business purposes, (ii) in connection with such Person’s purchase of Equity Interests in of Holdings (or any direct or indirect parent thereof) (provided that the amount of such loans and advances made in cash to such Person shall be contributed to the Borrower in cash as common equity or Qualified Equity Interests) and (iii) for purposes not described in the foregoing clauses (i) and (ii); provided that , in an aggregate principal amount outstanding at any time (excluding any paid in kind capitalized interest in respect thereof) not to exceed $5,000,000 (as determined at the time of incurrence thereof and after giving Pro Forma Effect thereto, the aggregate principal amount outstanding in reliance on this clause (iii) shall not exceed $1,000,000such Investment);
(c) Investments (i) by Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary in any of Loan Party, (ii) by any Restricted Subsidiary that is not a Loan Party in any other Restricted Subsidiary that is also not a Loan Party and (iii) by Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary; provided Subsidiary that the aggregate outstanding amount is not a Loan Party, constituting an exchange of Investments made by Loan Parties in Equity Interests of such Restricted Subsidiary for Indebtedness of such Restricted Subsidiary or 116 Blue Bird Body Company Credit Agreement constituting Guarantees of Indebtedness or other monetary obligations of Restricted Subsidiaries that are not Loan Parties in reliance on this clause (c) shall not exceed the greater of $10,000,000 and 35% of Consolidated EBITDAowing to any Loan Party;
(d) Investments consisting of prepayments to suppliers in the ordinary course of business;
(e) Investments consisting of extensions of trade credit in the ordinary course of business;
(f) Investments (i) existing or contemplated on the date hereof and set forth on Schedule 6.04(f6.04(d) and any modification, replacement, renewal, reinvestment or extension thereof and (ii) Investments existing on the date hereof by Holdings, the Borrower or any Restricted Subsidiary in the Borrower or any Restricted Subsidiary and any modification, renewal or extension thereof; provided that that, in each case, the amount of the original Investment is not increased except by the terms of such Investment to the extent as set forth on Schedule 6.04(f6.04(d) or as otherwise permitted by this Section 6.04;
(ge) Investments in Swap Agreements permitted under Section 6.01(a)(vi);
(hf) promissory notes and other non-cash consideration received in connection with Dispositions permitted by Section 6.05;
(ig) Permitted Acquisitions; provided that the aggregate amount of cash consideration paid or provided by any Loan Party or any Restricted Subsidiary after the Closing Date in reliance on this Section 6.04(g) (together with any Investments made in Restricted Subsidiaries that are not Loan Parties pursuant to Section 6.04(m)) for Permitted Acquisitions (including the aggregate principal amount of all Indebtedness assumed in connection with Permitted Acquisitions) for any Restricted Subsidiary that shall not be or, after giving effect to such Permitted Acquisition, shall not become a Loan Party (or for assets that are not purchased by, or promptly contributed to, a Loan Party), shall not exceed the Non-Loan Party Investment Amount at such time (as determined at the time of such Investment);
(j) the Transactions;
(k) Investments in the ordinary course of business consisting of endorsements for collection or deposit and customary trade arrangements with customers consistent with past practices;
(lh) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers and customers, from financially troubled account debtors customers or in settlement of delinquent obligations of, or other disputes with, customers and suppliers or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment;
(mi) loans and advances to Holdings (or any direct or indirect parent thereof) or any Intermediate Parent in lieu of, and not in excess of the amount of (after giving effect to any other loans, advances or Restricted Payments in respect thereof), Restricted Payments to the extent permitted to be made to Holdings (or such parent) or such Intermediate Parent in accordance with Section 6.08(a6.06(a)(iv);
(nj) additional so long as no Event of Default shall have occurred and be continuing, other Investments and other acquisitionsby the Borrower or any Restricted Subsidiary; provided that at the time any such Investment or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition all Investments made in reliance on this clause (n), together with the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (n), j) shall not exceed the sum of (A) the greater of $18,000,000 and 60% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Investment or other acquisition, plus (B) so long as no Event of Default has occurred and is continuing, the Available Amount that is Not Otherwise Applied at such time (excluding any paid in kind capitalized interest in respect thereof and as in effect immediately prior to determined at the time of making of such Investment);
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby;
(pk) advances of payroll payments to employees in the ordinary course of business;
; 117 Blue Bird Body Company Credit Agreement (ql) so long as no Event of Default shall have occurred and be continuing or would result therefrom and the Borrower shall be in compliance with the Financial Performance Covenant after giving Pro Forma Effect thereto, Investments and other acquisitions to the extent that payment for such Investments is made solely with Qualified Equity Interests (excluding Cure Amounts) of Holdings (or any direct or indirect parent thereof or the IPO Entitythereof); provided that (i) such amounts used pursuant to this clause (q) shall not increase the Available Amount and (ii) any amounts used for such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof or the IPO Entity) shall otherwise be permitted pursuant to this Section 6.04;
(r) Investments of a Subsidiary acquired after the Effective Date or of a Person merged or consolidated with any Subsidiary in accordance with this Section and Section 6.03 after the Effective Date to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger or consolidation and were in existence on the date of such acquisition, merger or consolidation;
(s) non-cash Investments in connection with tax planning and reorganization activities; provided that after giving effect to any such activities, the security interests of the Lenders in the Collateral, taken as a whole, would not be materially impaired;
(t) Investments consisting of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference to this Section 6.04(t)) under Sections 6.01, 6.02, 6.03, 6.05 and 6.08, respectively;
(u) additional Investments; provided that after giving effect to such Investment (A) on a Pro Forma Basis, the Total Net Leverage Ratio is less than or equal to 4.50 to 1.00 and (B) there is no continuing Event of Default;
(v) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the Borrower;
(w) to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Property, or other rights, in each case in the ordinary course of business;
(x) Investments by an Unrestricted Subsidiary entered into prior to the day such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to the definition of “Unrestricted Subsidiary”;
(y) Investments consisting of purchases of assets of Franchisees (including, but not limited to, area development contracts owned by Franchisees) in the ordinary course of business or otherwise in an amount not exceeding $60,000,000, so long as (A) no Event of Default shall have occurred and be continuing and (B) the Borrower is in pro forma compliance with the Financial Covenant after giving effect to any such purchase;
(z) So long as no Event of Default shall have occurred and be continuing, Investments in Franchisees (including, but not limited to, (i) Guarantees or other credit support of any Indebtedness and other liabilities thereof and (ii) loans, advances or contributions to the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater of $20,000,000 and 70% of Consolidated EBITDA;
(aa) Investments consisting of accounts and payment intangibles owing to the Borrower or any of the Restricted Subsidiaries from Franchisees; provided that such obligation shall be on such terms as the Borrower or the applicable Restricted Subsidiary establishes in good faith; and
(bb) Investments consisting of advances or expenditures by any Loan Party to, or on behalf of, any CMF Subsidiary in support of advertising and marketing programs in the ordinary course consistent with current practices. For purposes of determining compliance with this Section 6.04, in the event that any item of Investment meets the criteria of more than one of the categories of Investments described in clauses (a) through (bb) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such Investment (or any portion thereof) and will only be required to include the amount and type of such Investment in one or more of the above clauses.
Appears in 1 contract
Samples: Credit Agreement (Blue Bird Corp)
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor the Borrower willThe Issuer will not, nor and will they not permit any Restricted Subsidiary or Intermediate Parent to, make or hold any Investment, except:
(a) Permitted Investments at the time such Permitted Investment is mademade and purchases of assets in the ordinary course of business consistent with past practice;
(b) loans or advances to officers, directors members of the Board of Directors and employees of Holdings, any Intermediate Parent, the Borrower Issuer and the its Restricted Subsidiaries (i) for reasonable and customary business-related travel, entertainment, relocation and analogous ordinary business purposes, (ii) in connection with such Person’s purchase of Equity Interests in of Holdings (or any direct or indirect parent thereof) (provided that the amount of such loans and advances made in cash to such Person shall be contributed to the Borrower Issuer in cash as common equity or Qualified Equity Interests) and (iii) for purposes not described in the foregoing clauses (i) and (ii); provided that at the time of incurrence thereof and after giving Pro Forma Effect thereto, the in an aggregate principal amount outstanding in reliance on under this clause (iii) shall at any time not to exceed $1,000,00030,000,000;
(c) Investments by Holdings, the Issuer in any Intermediate Parent, the Borrower or Restricted Subsidiary and Investments by any Restricted Subsidiary in any of Holdings, any Intermediate Parent, the Borrower Issuer or any other Restricted Subsidiary; provided that, in the case of any Investment by a Note Party in a Restricted Subsidiary that the aggregate outstanding amount is not a Note Party, no Event of Investments made by Loan Parties in Restricted Subsidiaries that are not Loan Parties in reliance on this clause (c) Default shall not exceed the greater of $10,000,000 have occurred and 35% of Consolidated EBITDAbe continuing or would result therefrom;
(d) Investments consisting of prepayments to suppliers extensions of trade credit and accommodation guarantees in the ordinary course of business;
(e) Investments consisting of extensions of trade credit in the ordinary course of business;
(f) Investments (i) existing or contemplated on the date hereof Issue Date and set forth on Schedule 6.04(f) 5.04 and any modification, replacement, renewal, reinvestment or extension thereof and (ii) Investments existing on the date hereof Issue Date by Holdings, the Borrower Issuer or any Restricted Subsidiary in the Borrower Issuer or any Restricted Subsidiary and any modification, renewal or extension thereof; provided that the amount of the original Investment is not increased except by the terms of such Investment to the extent as set forth on Schedule 6.04(f) 5.04 or as otherwise permitted by this Section 6.045.04;
(gf) Investments in Swap Agreements permitted under Section 6.01(a)(vi)incurred in the ordinary course of business and not for speculative purposes;
(hg) promissory notes and other non-cash consideration received in connection with Dispositions permitted by Section 6.055.05;
(ih) Permitted Acquisitions;
(ji) the Transactions;
(kj) Investments in the ordinary course of business consisting of Uniform Commercial Code Article 3 endorsements for collection or deposit and Uniform Commercial Code Article 4 customary trade arrangements with customers consistent with past practicesin the ordinary course of business;
(lk) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers and customers, from financially troubled account debtors customers or in settlement of delinquent obligations of, or other disputes with, customers and suppliers or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment;
(ml) loans and advances to Holdings (or any direct or indirect parent thereof) or any Intermediate Parent (x) in lieu of, and not in excess of the amount of (after giving effect to any other loans, advances or Restricted Payments in respect thereof), Restricted Payments to the extent permitted to be made to Holdings (or such parent) or such Intermediate Parent in accordance with Section 6.08(a)5.07(a) and (y) to the extent the proceeds thereof are contributed or loaned or advanced to any Restricted Subsidiary;
(nm) additional Investments and other acquisitions; provided that at the time any such Investment or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition made in reliance on this clause (nm), together with the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (nm) (including the aggregate principal amount of all Indebtedness assumed in connection with any such other Investment or acquisition previously made under this clause (m)), shall not exceed the sum of (A) the greater of (i)(A) $18,000,000 195,000,000 and 60(B) 50% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Investment or other acquisition, plus (Bii) so long as immediately after giving effect to any such Investment (x) no Event of Default has occurred and is continuingcontinuing and (y) on a Pro Forma Basis, the Total Net Leverage Ratio does not exceed 7.50 to 1.00 for the most recently ended Test Period, the Available Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of such Investment plus (iii) the Available Equity Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of such Investment; plus (C) the General Restricted Payment Reallocated Amount; plus (D) the Junior Debt Payment Reallocated Amount;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby;
(pn) advances of payroll payments to employees in the ordinary course of business;
(qo) Investments and other acquisitions to the extent that payment for such Investments is made with Qualified Equity Interests (excluding Cure AmountsQualified Equity Interests the proceeds of which will be applied to cure any default under any “equity cure” provisions with respect to any financial maintenance covenant under the Credit Agreement) of Holdings (or any direct or indirect parent thereof or the IPO Entity); provided that (i) such amounts used pursuant to this clause (q) shall not increase the Available Amount and (ii) any amounts used for such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof or the IPO Entity) shall otherwise be permitted pursuant to this Section 6.04;
(rp) Investments of a Subsidiary acquired after the Effective Issue Date or of a Person merged merged, amalgamated or consolidated with any Subsidiary in accordance with this Section 5.04 and Section 6.03 5.03 after the Effective Issue Date or that otherwise becomes a Subsidiary (provided that if such Investment is made under Section 5.04(h), existing Investments in subsidiaries of such Subsidiary or Person shall comply with the requirements of Section 5.04(h)) to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger merger, amalgamation or consolidation and were in existence on the date of such acquisition, merger merger, amalgamation or consolidation;
(q) receivables owing to the Issuer or any Restricted Subsidiary, if created or acquired in the ordinary course of business;
(r) Investments (A) for utilities, security deposits, leases and similar prepaid expenses incurred in the ordinary course of business and (B) trade accounts created, or prepaid expenses accrued, in the ordinary course of business;
(s) non-cash Investments in connection with tax planning and reorganization activities; provided that after giving effect to any such activities, the security interests of the Lenders Holders in the Collateral, taken as a whole, would not be materially impaired;
(t) additional Investments so long as at the time of any such Investment and after giving effect thereto, (A) on a Pro Forma Basis, the Senior Secured Net Leverage Ratio is no greater than 7.00 to 1.00 for the most recently ended Test Period and (B) no Event of Default exists or would result therefrom;
(u) Investments consisting of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference to this Section 6.04(t5.04(v)) under Sections 6.015.01, 6.025.02, 6.035.03, 6.05 5.05 and 6.085.07, respectively;
(u) additional Investments; provided that after giving effect to such Investment (A) on a Pro Forma Basis, the Total Net Leverage Ratio is less than or equal to 4.50 to 1.00 and (B) there is no continuing Event of Default;
(v) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the BorrowerIssuer;
(w) to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Property, or other rights, in each case in the ordinary course of business;
(x) any Investment in any Subsidiary or any joint venture in connection with intercompany cash management arrangements or related activities arising in the ordinary course of business;
(y) Investments by an Unrestricted Subsidiary entered into prior to the day such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to the definition of “Unrestricted Subsidiary”;
(yz) Investments consisting in or relating to a Securitization Subsidiary that, in the good faith determination of purchases of assets of Franchisees (the Issuer are necessary or advisable to effect any Qualified Securitization Facility or any repurchase obligation in connection therewith, including, but not limited towithout limitation, area development contracts owned Investments of funds held in accounts permitted or required by Franchiseesthe arrangements governing such Qualified Securitization Facilities or any related Indebtedness; and
(aa) Investments in the ordinary course of business or otherwise in an amount not exceeding $60,000,000, so long as (A) no Event of Default shall have occurred and be continuing and (B) the Borrower is in pro forma compliance with the Financial Covenant after giving effect to any such purchase;
(z) So long as no Event of Default shall have occurred and be continuing, Investments in Franchisees (including, but not limited to, (i) Guarantees or other credit support of any Indebtedness and other liabilities thereof and (ii) loans, advances or contributions to the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater of $20,000,000 and 70% of Consolidated EBITDA;
(aa) Investments consisting of accounts and payment intangibles owing to the Borrower or any of the Restricted Subsidiaries from Franchisees; provided that such obligation shall be on such terms as the Borrower or the applicable Restricted Subsidiary establishes in good faith; and
(bb) Investments consisting of advances or expenditures by any Loan Party to, or on behalf of, any CMF Subsidiary in support of advertising and marketing programs in the ordinary course consistent with current practices. For purposes of determining compliance with this Section 6.04, in the event that any item of Investment meets the criteria of more than one of the categories of Investments described in clauses (a) through (bb) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such Investment (or any portion thereof) and will only be required to include the amount and type of such Investment in one or more of the above clausesSettlements.
Appears in 1 contract
Samples: Indenture (Sotera Health Co)
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor the Borrower willwill not, nor and will they not permit any Restricted Subsidiary or Intermediate Parent to, make or hold any Investment, except:
: (a) Permitted Investments at the time such Permitted Investment is made;
made and purchases of assets in the ordinary course of business consistent with past practice; (b) loans or advances to officers, directors members of the Board of Directors and employees of Holdings, any Intermediate Parent, the Borrower and the itsthe Restricted Subsidiaries (i) for reasonable and customary business-related travel, entertainment, relocation and analogous ordinary business purposes, (ii) in connection with such Person’s purchase of Equity Interests in of Holdings (or any direct or indirect parent thereof) (provided that the amount of such loans and advances made in cash to such Person shall be contributed to the Borrower Holdings in cash as common equity or Qualified Equity Interests) and (iii) for purposes not described in the foregoing clauses (i) and (ii); provided that at the time of incurrence thereof and after giving Pro Forma Effect thereto, the in an aggregate principal amount outstanding in reliance on under this clause (iii) shall at any time not to exceed $1,000,000;
10,000,000; (c) Investments by Holdings, Holdings in any Intermediate Parent, the Borrower or Restricted Subsidiary and Investments by any Restricted Subsidiary in any of Holdings, any Intermediate Parent, the Borrower other Restricted Subsidiary or any Person that becomes a Restricted SubsidiarySubsidiary after the Effective Date as a result of such Investment (but only to the extent that such Investment was not incurred in contemplation thereof); provided that, in the case of any Investment by a Loan Party in a Restricted Subsidiary that the aggregate outstanding amount is not a Loan Party, no Event of Investments made by Loan Parties in Restricted Subsidiaries that are not Loan Parties in reliance on this clause (c) Default shall not exceed the greater of $10,000,000 have occurred and 35% of Consolidated EBITDA;
be continuing or would result therefrom; (d) Investments consisting of prepayments to suppliers in the ordinary course of business;
(e) Investments consisting of extensions of trade credit and accommodation guarantees in the ordinary course of business;
; (fe) Investments (i) existing or contemplated on the date hereof Effective Date and set forth on Schedule 6.04(f) 6.04 and any modification, replacement, renewal, reinvestment or extension thereof and (ii) Investments existing on the date hereof Effective Date by Holdings, the Borrower Holdings or any Restricted Subsidiary in the Borrower Holdings or any Restricted Subsidiary and any modification, renewal or extension thereof; provided that the amount of the -141- [EMEA_ACTIVE 302040156_13] original Investment is not increased except by the terms of such Investment to the extent as set forth on Schedule 6.04(f) 6.04 or as otherwise permitted by this Section 6.04;
; (gf) Investments in Swap Agreements permitted under Section 6.01(a)(vi);
incurred in the ordinary course of business and not for speculative purposes; (hg) promissory notes and other non-cash consideration received in connection with Dispositions permitted by Section 6.05;
; (h) Permitted Acquisitions; (i) Permitted Acquisitions;
the Transactions; (j) the Transactions;
(k) Investments in the ordinary course of business consisting of Uniform Commercial Code Article 3 endorsements for collection or deposit and Uniform Commercial Code Article 4 customary trade arrangements with customers consistent with past practices;
in the ordinary course of business; (lk) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers and customers, from financially troubled account debtors customers or in settlement of delinquent obligations of, or other disputes with, customers and suppliers or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment;
; (l) [reserved]Investments consisting of the 2020 Capped Call Transactions and any Convertible Indebtedness Call Transactions; (m) loans and advances to Holdings (or any direct or indirect parent thereof) or any Intermediate Parent in lieu of, and not in excess of the amount of (after giving effect to any other loans, advances or Restricted Payments in respect thereof), Restricted Payments to the extent permitted to be made to Holdings (or such parent) or such Intermediate Parent in accordance with Section 6.08(a);
(n) additional Investments and other acquisitions; provided that at the time any such Investment or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition made in reliance on this clause (nm), together with the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (nm) (including the aggregate principal amount of all Indebtedness assumed in connection with any such other Investment or acquisition previously made under this clause (m)), shall not exceed the sum greater of (A) the greater of $18,000,000 52,800,00053,400,000 and 60(B) 30% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Investment or other acquisition, plus ; (B) so long as no Event of Default has occurred and is continuing, the Available Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of such Investment;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby;
(pn) advances of payroll payments to employees in the ordinary course of business;
; (qo) Investments and other acquisitions to the extent that payment for such Investments is made with Qualified Equity Interests (excluding Qualified Equity Interests the proceeds of which will be applied as Cure Amounts) of Holdings (or any direct or indirect parent thereof or the IPO Entitythereof); provided that (i) such amounts used pursuant to this clause (q) shall not increase the Available Amount and (ii) any amounts used for such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof or the IPO Entity) shall otherwise be permitted pursuant to this Section 6.04;
(rp) Investments of a Subsidiary acquired after the Effective Date or of a Person merged merged, amalgamated or consolidated with any Subsidiary in accordance with this Section 6.04 and Section 6.03 after the Effective Date or that otherwise becomes a Subsidiary (provided that if such Investment is made under Section 6.04(h), existing Investments in subsidiaries of such Subsidiary or Person shall comply with the requirements of Section 6.04(h)) to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger merger, amalgamation or consolidation and were in existence on the date of such acquisition, merger merger, amalgamation or consolidation;
; (sq) non-cash Investments in connection with tax planning and reorganization activities; provided that after giving effect receivables owing to any such activities, the security interests of the Lenders in the Collateral, taken as a whole, would not be materially impaired;
(t) Investments consisting of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference to this Section 6.04(t)) under Sections 6.01, 6.02, 6.03, 6.05 and 6.08, respectively;
(u) additional Investments; provided that after giving effect to such Investment (A) on a Pro Forma Basis, the Total Net Leverage Ratio is less than or equal to 4.50 to 1.00 and (B) there is no continuing Event of Default;
(v) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the Borrower;
(w) to the extent that they constitute Investmentsany Restricted Subsidiary, purchases and acquisitions of inventory, supplies, materials if created or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Property, or other rights, in each case acquired in the ordinary course of business;
(x) Investments by an Unrestricted Subsidiary entered into prior to the day such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to the definition of “Unrestricted Subsidiary”;
(y) Investments consisting of purchases of assets of Franchisees (including, but not limited to, area development contracts owned by Franchisees) in the ordinary course of business or otherwise in an amount not exceeding $60,000,000, so long as (A) no Event of Default shall have occurred and be continuing and (B) the Borrower is in pro forma compliance with the Financial Covenant after giving effect to any such purchase;
(z) So long as no Event of Default shall have occurred and be continuing, Investments in Franchisees (including, but not limited to, (i) Guarantees or other credit support of any Indebtedness and other liabilities thereof and (ii) loans, advances or contributions to the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater of $20,000,000 and 70% of Consolidated EBITDA;
(aa) Investments consisting of accounts and payment intangibles owing to the Borrower or any of the Restricted Subsidiaries from Franchisees; provided that such obligation shall be on such terms as the Borrower or the applicable Restricted Subsidiary establishes in good faith; and
(bb) Investments consisting of advances or expenditures by any Loan Party to, or on behalf of, any CMF Subsidiary in support of advertising and marketing programs in the ordinary course consistent with current practices. For purposes of determining compliance with this Section 6.04, in the event that any item of Investment meets the criteria of more than one of the categories of Investments described in clauses (a) through (bb) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such Investment (or any portion thereof) and will only be required to include the amount and type of such Investment in one or more of the above clauses.-142- [EMEA_ACTIVE 302040156_13]
Appears in 1 contract
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor the The Borrower willwill not, nor will they it permit any Restricted Subsidiary or Intermediate Parent to, make or hold any Investment, except:
(a) Permitted Investments at the time such Permitted Investment is made;
(b) loans or advances to officers, directors and employees of Holdings, any Intermediate Parent, the Borrower and the Restricted Subsidiaries (i) for reasonable and customary business-related travel, entertainment, relocation and analogous ordinary business purposes, (ii) in connection with such Person’s purchase of Equity Interests in Holdings the Borrower (or any direct or indirect parent thereof) (provided that the amount of such loans and advances made in cash to such Person shall be contributed to by the Borrower in cash as common equity or Qualified Equity Interests) and (iii) for purposes not described in the foregoing clauses (i) and (ii); provided that at the time of incurrence thereof and after giving Pro Forma Effect thereto, the aggregate principal amount outstanding in reliance on this clause (iii) shall not to exceed $1,000,00010,000,000;
(c) Investments (i) by Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary in any of HoldingsLoan Party, (ii) by any Intermediate ParentRestricted Subsidiary that is not a Loan Party in any other Restricted Subsidiary that is also not a Loan Party, (iii) by the Borrower or any Restricted Subsidiary (A) in any Restricted Subsidiary; provided that (i) the aggregate outstanding amount of such Investments made by Loan Parties after the Effective Date in Restricted Subsidiaries that are not Loan Parties in reliance on this clause (ciii)(A) shall not exceed exceed, at the time of incurrence thereof and after giving Pro Forma Effect thereto, the greater of $10,000,000 and 3512.5% of Consolidated EBITDAEBITDA and $20,000,000 and (ii) no Event of Default has occurred and is continuing, (B) in any Restricted Subsidiary that is not a Loan Party, constituting an exchange of Equity Interests of such Restricted Subsidiary for Indebtedness of such Subsidiary or (C) constituting Guarantees of Indebtedness or other monetary obligations of Restricted Subsidiaries that are not Loan Parties owing to any Loan Party, (iv) by the Borrower or any Restricted Subsidiary in Restricted Subsidiaries that are not Loan Parties so long as such transactions is part of a series of simultaneous transactions that result in the proceeds of the initial Investment being invested in one or more Loan Parties (or, if the initial proceeds were held at a Restricted Subsidiary that is not a Loan Party, a Restricted Subsidiary that is not a Loan Party) and (v) by the Borrower or any Restricted Subsidiary in any Restricted Subsidiary that is not a Loan Party, consisting of the contribution of Equity Interests of any other Restricted Subsidiary that is not a Loan Party so long as the Equity Interests of the transferee Restricted Subsidiary is pledged to secure the Secured Obligations;
(d) Investments consisting of prepayments to suppliers in the ordinary course of business;
(e) Investments consisting of extensions of trade credit in the ordinary course of business;
(f) Investments (i) existing or contemplated on the date hereof and set forth on Schedule 6.04(f) and any modification, replacement, renewal, reinvestment or extension thereof and (ii) Investments existing on the date hereof by Holdings, the Borrower or any Restricted Subsidiary in the Borrower or any Restricted Subsidiary and any modification, renewal or extension thereof; provided that the amount of the original Investment is not increased except by the terms of such Investment to the extent as set forth on Schedule 6.04(f) or as otherwise permitted by this Section 6.04;
(g) Investments in Swap Agreements permitted under Section 6.01(a)(vi)6.01;
(h) promissory notes and other non-cash consideration received in connection with Dispositions permitted by Section 6.05;
(i) Permitted Acquisitions;
(j) the Transactions;
(k) Investments in the ordinary course of business consisting of endorsements for collection or deposit and customary trade arrangements with customers consistent with past practices;
(l) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers and customers, from financially troubled account debtors or in settlement of delinquent obligations of, or other disputes with, customers and suppliers or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment;
(m) loans and advances to Holdings the Borrower (or any direct or indirect parent thereof) or any Intermediate Parent in lieu of, and not in excess of the amount of (after giving effect to any other loans, advances or Restricted Payments in respect thereof), Restricted Payments to the extent permitted to be made to Holdings the Borrower (or such parent) or such Intermediate Parent in accordance with Section 6.08(a);
(n) additional [reserved];
(o) other Investments and other acquisitions; provided that at the time any such Investment or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition all Investments made in reliance on this clause (n), o) together with the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (no) (including the aggregate principal amount of all Indebtedness assumed in connection with any such other acquisition), shall not exceed the sum of (Ai) the greater of $18,000,000 40,000,000 and 6037.5% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Investment or other acquisition, plus (Bii) so long as no Event of Default has occurred and is continuing, the Available Equity Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of such Investment;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby;
(p) advances of payroll payments to employees in the ordinary course of business;
(q) Investments and other acquisitions to the extent that payment for such Investments is made with Qualified Equity Interests (excluding Cure Amounts) of Holdings the Borrower (or any direct or indirect parent thereof or the IPO Entitythereof); provided that (i) such amounts used pursuant to this clause (q) shall not increase the Available Equity Amount and (ii) any amounts used for such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof or the IPO Entitythereof) shall otherwise be permitted pursuant to this Section 6.04;
(r) Investments of a Subsidiary acquired after the Effective Date or of a Person merged or consolidated with any Subsidiary in accordance with this Section and Section 6.03 after the Effective Date to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger or consolidation and were in existence on the date of such acquisition, merger or consolidation;
(s) non-cash Investments in connection with tax planning and reorganization activities; provided that after giving effect to any such activities, the security interests of the Lenders in the Collateral, taken as a whole, would not be materially impaired;
(t) Investments consisting of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference to this Section 6.04(t)) under Sections 6.01, 6.02, 6.03, 6.05 and 6.08, respectively;
(u) additional Investments; provided that after giving effect to such Investment (A) on a Pro Forma Basis, the Total Net Leverage Ratio is less than or equal to 4.50 to 1.00 and (B) there is no continuing Event of Default;
(v) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the Borrower;
(w) to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Property, or other rights, in each case in the ordinary course of business;
(x) Investments by an Unrestricted Subsidiary entered into prior to the day such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to the definition of “Unrestricted Subsidiary”;
(y) Investments consisting of purchases of assets of Franchisees (including, but not limited to, area development contracts owned by Franchisees) in the ordinary course of business or otherwise in an amount not exceeding $60,000,000, so long as (A) no Event of Default shall have occurred and be continuing and (B) the Borrower is in pro forma compliance with the Financial Covenant after giving effect to any such purchase;
(z) So long as no Event of Default shall have occurred and be continuing, Investments in Franchisees (including, but not limited to, (i) Guarantees or other credit support of any Indebtedness and other liabilities thereof and (ii) loans, advances or contributions to the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater of $20,000,000 and 70% of Consolidated EBITDA;
(aa) Investments consisting of accounts and payment intangibles owing to the Borrower or any of the Restricted Subsidiaries from Franchisees; provided that such obligation shall be on such terms as the Borrower or the applicable Restricted Subsidiary establishes in good faith; and
(bb) Investments consisting of advances or expenditures by any Loan Party to, or on behalf of, any CMF Subsidiary in support of advertising and marketing programs in the ordinary course consistent with current practices. For purposes of determining compliance with this Section 6.04, in the event that any item of Investment meets the criteria of more than one of the categories of Investments described in clauses (a) through (bb) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such Investment (or any portion thereof) and will only be required to include the amount and type of such Investment in one or more of the above clauses.
Appears in 1 contract
Samples: Abl Credit Agreement (Chewy, Inc.)
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor the Borrower will, nor will they permit any Restricted Subsidiary or Intermediate Parent to, make or hold any Investment, except:
(a) Permitted Investments at the time such Permitted Investment is madeInvestments;
(b) loans or advances to officers, directors and employees of Holdings, any Intermediate Parent, the Borrower and the its Restricted Subsidiaries (i) for reasonable and customary business-related travel, entertainment, relocation and analogous ordinary business purposes, (ii) in connection with such Person’s purchase of Equity Interests in of Holdings (or any direct or indirect parent thereof) (provided that the amount of such loans and advances made in cash to such Person shall be contributed to the Borrower in cash as common equity or Qualified Equity Interests) and (iii) for purposes not described in the foregoing clauses (i) and (ii); provided that at the time of incurrence thereof and after giving Pro Forma Effect thereto, the in an aggregate principal amount outstanding in reliance on this clause (iii) shall at any time not to exceed $1,000,00010,000,000;
(c) Investments (i) by Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary in any of HoldingsLoan Party (excluding any new Restricted Subsidiary that becomes a Loan Party pursuant to such Investment), (ii) by any Intermediate ParentRestricted Subsidiary that is not a Loan Party in any other Restricted Subsidiary that is also not a Loan Party, (iii) by the Borrower or any Restricted Subsidiary (A) in any Restricted Subsidiary; provided that the aggregate outstanding amount of such Investments made by Loan Parties after the Effective Date in Restricted Subsidiaries that are not Loan Parties in reliance on this clause (ciii)(A) (including any such Investments deemed to be made pursuant to Section 6.14(b)) (together with the amount of Investments made in Restricted Subsidiaries that are not Loan Parties pursuant to Section 6.04(h)) shall not exceed the greater Non-Loan Party Investment Amount at the time of $10,000,000 any such Investment, (B) in any Restricted Subsidiary that is not a Loan Party, constituting an exchange of Equity Interests of such Restricted Subsidiary for Indebtedness of such Subsidiary or (C) constituting Guarantees of Indebtedness or other monetary obligations of Restricted Subsidiaries that are not Loan Parties owing to any Loan Party, (iv) by Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary in Restricted Subsidiaries that are not Loan Parties so long as such Investment is part of a series of simultaneous Investments that result in the proceeds of the initial Investment being invested in one or more Loan Parties and 35% (v) by Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary in any Restricted Subsidiary that is not a Loan Party, consisting of Consolidated EBITDAthe contribution of Equity Interests of any other Restricted Subsidiary that is not a Loan Party so long as the Equity Interests of the transferee Restricted Subsidiary is pledged to secure the Secured Obligations;
(d) Investments consisting of prepayments to suppliers in the ordinary course of business;
(e) Investments consisting of extensions of trade credit in the ordinary course of business;
(fe) Investments (i) existing or contemplated on the date hereof and set forth on Schedule 6.04(f6.04(e) and any modification, replacement, renewal, reinvestment or extension thereof and (ii) Investments existing on the date hereof by Holdings, the Borrower or any Restricted Subsidiary in the Borrower or any Restricted Subsidiary and any modification, renewal or extension thereof; provided that the amount of the original Investment is not increased except by the terms of such Investment to the extent as set forth on Schedule 6.04(f6.04(e) or as otherwise permitted by this Section 6.04;
(gf) Investments in Swap Agreements permitted under Section 6.01(a)(vi)6.07;
(hg) promissory notes and other non-cash consideration received in connection with Dispositions permitted by Section 6.05;
(ih) Permitted Acquisitions; provided that the aggregate amount of consideration paid or provided by Holdings, any Intermediate Parent, the Borrower or any other Loan Party after the Effective Date in reliance on this Section 6.04(h) (together with any Investments made in Subsidiaries that are not Loan Parties pursuant to Section 6.04(c)(iii)(A)) for Permitted Acquisitions (including the aggregate principal amount of all Indebtedness assumed in connection with Permitted Acquisitions) for any Restricted Subsidiary that shall not be or, after giving effect to such Permitted Acquisition, shall not become a Loan Party, shall not exceed the Non-Loan Party Investment Amount at such time;
(ji) the Transactions;
(kj) Investments in the ordinary course of business consisting of Uniform Commercial Code Article 3 endorsements for collection or deposit and Uniform Commercial Code Article 4 customary trade arrangements with customers consistent with past practices;
(lk) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers and customers, from financially troubled account debtors customers or in settlement of delinquent obligations of, or other disputes with, customers and suppliers or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment;
(ml) loans and advances to Holdings (or any direct or indirect parent thereof) or any Intermediate Parent in lieu of, and not in excess of the amount of (after giving effect to any other loans, advances or Restricted Payments in respect thereof), Restricted Payments to the extent permitted to be made to Holdings (or such parent) or such Intermediate Parent in accordance with Section 6.08(a6.08(a)(iv), (v), (vi), (vii) or (viii);
(nm) additional so long as immediately after giving effect to any such Investment no Default has occurred and is continuing, other Investments and other acquisitions; provided that at the time any such Investment (including any such Investments deemed to be made pursuant to Section 6.14(b)) or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition all Investments made in reliance on this clause (nm) (including all such Investments deemed made pursuant to Section 6.14(b) and all Investments made pursuant to clause (d) of the definition of “Non-Loan Party Investment Amount”), together with the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (nm) (including the aggregate principal amount of all Indebtedness assumed in connection with any such other acquisition), shall not exceed the sum of (A) the greater of $18,000,000 150,000,000 and 6045% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Investment or other acquisition; provided further that such amount shall be increased by (i) the Net Proceeds of any issuance of, plus or contribution of cash in respect of existing, Qualified Equity Interests (Bother than any such issuance or contribution made pursuant to Section 7.02) so long as no Event that are Not Otherwise Applied and (ii) the amount of Default has occurred and is continuing, the Available Amount Cumulative Excess Cash Flow that is Not Otherwise Applied as in effect immediately prior to the time of making of such InvestmentApplied;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby;
(pn) advances of payroll payments to employees in the ordinary course of business;
(qo) Investments and other acquisitions to the extent that payment for such Investments is made solely with Qualified Equity Interests (excluding Cure Amounts) of Holdings (or any direct or indirect parent thereof or the IPO Entity); provided that (i) such amounts used pursuant to this clause (q) shall not increase the Available Amount and (ii) any amounts used for such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof or the IPO Entity) shall otherwise be permitted pursuant to this Section 6.04;
(rp) Investments of a Subsidiary acquired after the Effective Date or of a Person merged or consolidated with any Subsidiary in accordance with this Section and Section 6.03 after the Effective Date (other than existing Investments in subsidiaries of such Subsidiary or Person, which must comply with the requirements of Section 6.04(h) or 6.04(m)) to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger or consolidation and were in existence on the date of such acquisition, merger or consolidation;; and
(sq) non-cash Investments in connection with tax planning and reorganization activities; provided that after giving effect to any such activities, the security interests of the Lenders in the Collateral, taken as a whole, would not be materially impaired;
(t) Investments consisting of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference to this Section 6.04(t)) under Sections 6.01, 6.02, 6.03, 6.05 and 6.08, respectively;
(u) additional Investments; provided that after giving effect to such Investment (A) on a Pro Forma Basis, the Total Net Leverage Ratio is less than or equal to 4.50 to 1.00 and (B) there is no continuing Event of Default;
(v) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the Borrower;
(w) to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Property, or other rights, in each case in the ordinary course of business;
(x) Investments by an Unrestricted Subsidiary entered into prior to the day such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to the definition of “Unrestricted Subsidiary”;
(y) Investments consisting of purchases of assets of Franchisees (including, but not limited to, area development contracts owned by Franchisees) in the ordinary course of business or otherwise in an amount not exceeding $60,000,000, so long as (A) no Event of Default shall have occurred and be continuing and (B) the Borrower is in pro forma compliance with the Financial Covenant after giving effect to any such purchase;
(z) So long as no Event of Default shall have occurred and be continuing, Investments in Franchisees (including, but not limited to, (i) Guarantees or other credit support of any Indebtedness and other liabilities thereof and (ii) loans, advances or contributions to the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater of $20,000,000 and 70% of Consolidated EBITDA;
(aa) Investments consisting of accounts and payment intangibles owing to the Borrower or any of the Restricted Subsidiaries from Franchisees; provided that such obligation shall be on such terms as the Borrower or the applicable Restricted Subsidiary establishes in good faith; and
(bb) Investments consisting of advances or expenditures by any Loan Party to, or on behalf of, any CMF Subsidiary in support of advertising and marketing programs in the ordinary course consistent with current practices. For purposes of determining compliance with this Section 6.04, in the event that any item of Investment meets the criteria of more than one of the categories of Investments described in clauses (a) through (bb) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such Investment (or any portion thereof) and will only be required to include the amount and type of such Investment in one or more of the above clauses.
Appears in 1 contract
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor the Borrower willwill not, nor and will they not permit any Restricted Subsidiary or Intermediate Parent to, make or hold any Investment, except:
: (a) Permitted Investments at the time such Permitted Investment is made;
made and purchases of assets in the ordinary course of business consistent with past practice; (b) loans or advances to officers, directors members of the Board of Directors and employees of Holdings, any Intermediate Parent, the Borrower and the Restricted Subsidiaries (i) for reasonable and customary business-related travel, entertainment, relocation and analogous ordinary business purposes, (ii) in connection with such Person’s purchase of Equity Interests in of Holdings (or any direct or indirect parent thereof) (provided that the amount of such loans and advances made in cash to such Person shall be contributed to the Borrower Holdings in cash as -134- common equity or Qualified Equity Interests) and (iii) for purposes not described in the foregoing clauses (i) and (ii); provided that at the time of incurrence thereof and after giving Pro Forma Effect thereto, the in an aggregate principal amount outstanding in reliance on under this clause (iii) shall at any time not to exceed $1,000,000;
10,000,000; (c) Investments by Holdings, Holdings in any Intermediate Parent, the Borrower or Restricted Subsidiary and Investments by any Restricted Subsidiary in any of Holdings, any Intermediate Parent, the Borrower other Restricted Subsidiary or any Person that becomes a Restricted SubsidiarySubsidiary after the Effective Date as a result of such Investment (but only to the extent that such Investment was not incurred in contemplation thereof); provided that, in the case of any Investment by a Loan Party in a Restricted Subsidiary that the aggregate outstanding amount is not a Loan Party, no Event of Investments made by Loan Parties in Restricted Subsidiaries that are not Loan Parties in reliance on this clause (c) Default shall not exceed the greater of $10,000,000 have occurred and 35% of Consolidated EBITDA;
be continuing or would result therefrom; (d) Investments consisting of prepayments to suppliers in the ordinary course of business;
(e) Investments consisting of extensions of trade credit and accommodation guarantees in the ordinary course of business;
; (fe) Investments (i) existing or contemplated on the date hereof Effective Date and set forth on Schedule 6.04(f) 6.04 and any modification, replacement, renewal, reinvestment or extension thereof and (ii) Investments existing on the date hereof Effective Date by Holdings, the Borrower Holdings or any Restricted Subsidiary in the Borrower Holdings or any Restricted Subsidiary and any modification, renewal or extension thereof; provided that the amount of the original Investment is not increased except by the terms of such Investment to the extent as set forth on Schedule 6.04(f) 6.04 or as otherwise permitted by this Section 6.04;
; (gf) Investments in Swap Agreements permitted under Section 6.01(a)(vi);
incurred in the ordinary course of business and not for speculative purposes; (hg) promissory notes and other non-cash consideration received in connection with Dispositions permitted by Section 6.05;
; (h) Permitted Acquisitions; (i) Permitted Acquisitions;
the Transactions; (j) the Transactions;
(k) Investments in the ordinary course of business consisting of Uniform Commercial Code Article 3 endorsements for collection or deposit and Uniform Commercial Code Article 4 customary trade arrangements with customers consistent with past practices;
in the ordinary course of business; (lk) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers and customers, from financially troubled account debtors customers or in settlement of delinquent obligations of, or other disputes with, customers and suppliers or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment;
; (l) Investments consisting of the 2020 Capped Call Transactions and any Convertible Indebtedness Call Transactions; (m) loans and advances to Holdings (or any direct or indirect parent thereof) or any Intermediate Parent in lieu of, and not in excess of the amount of (after giving effect to any other loans, advances or Restricted Payments in respect thereof), Restricted Payments to the extent permitted to be made to Holdings (or such parent) or such Intermediate Parent in accordance with Section 6.08(a);
(n) additional Investments and other acquisitions; provided that at the time any such Investment or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition made in reliance on this clause (nm), together with the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (nm) (including the aggregate principal amount of all Indebtedness assumed in connection with any such other Investment or acquisition previously made under this clause (m)), shall not exceed the sum greater of (A) the greater of $18,000,000 53,400,000 and 60(B) 30% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Investment or other acquisition, plus ; (B) so long as no Event of Default has occurred and is continuing, the Available Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of such Investment;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby;
(pn) advances of payroll payments to employees in the ordinary course of business;
(q) Investments and other acquisitions to the extent that payment for such Investments is made with Qualified Equity Interests (excluding Cure Amounts) of Holdings (or any direct or indirect parent thereof or the IPO Entity); provided that (i) such amounts used pursuant to this clause (q) shall not increase the Available Amount and (ii) any amounts used for such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof or the IPO Entity) shall otherwise be permitted pursuant to this Section 6.04;
(r) Investments of a Subsidiary acquired after the Effective Date or of a Person merged or consolidated with any Subsidiary in accordance with this Section and Section 6.03 after the Effective Date to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger or consolidation and were in existence on the date of such acquisition, merger or consolidation;
(s) non-cash Investments in connection with tax planning and reorganization activities; provided that after giving effect to any such activities, the security interests of the Lenders in the Collateral, taken as a whole, would not be materially impaired;
(t) Investments consisting of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference to this Section 6.04(t)) under Sections 6.01, 6.02, 6.03, 6.05 and 6.08, respectively;
(u) additional Investments; provided that after giving effect to such Investment (A) on a Pro Forma Basis, the Total Net Leverage Ratio is less than or equal to 4.50 to 1.00 and (B) there is no continuing Event of Default;
(v) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the Borrower;
(w) to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Property, or other rights, in each case in the ordinary course of business;
(x) Investments by an Unrestricted Subsidiary entered into prior to the day such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to the definition of “Unrestricted Subsidiary”;
(y) Investments consisting of purchases of assets of Franchisees (including, but not limited to, area development contracts owned by Franchisees) in the ordinary course of business or otherwise in an amount not exceeding $60,000,000, so long as (A) no Event of Default shall have occurred and be continuing and (B) the Borrower is in pro forma compliance with the Financial Covenant after giving effect to any such purchase;
(z) So long as no Event of Default shall have occurred and be continuing, Investments in Franchisees (including, but not limited to, (i) Guarantees or other credit support of any Indebtedness and other liabilities thereof and (ii) loans, advances or contributions to the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater of $20,000,000 and 70% of Consolidated EBITDA;
(aa) Investments consisting of accounts and payment intangibles owing to the Borrower or any of the Restricted Subsidiaries from Franchisees; provided that such obligation shall be on such terms as the Borrower or the applicable Restricted Subsidiary establishes in good faith; and
(bb) Investments consisting of advances or expenditures by any Loan Party to, or on behalf of, any CMF Subsidiary in support of advertising and marketing programs in the ordinary course consistent with current practices. For purposes of determining compliance with this Section 6.04, in the event that any item of Investment meets the criteria of more than one of the categories of Investments described in clauses (a) through (bb) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such Investment (or any portion thereof) and will only be required to include the amount and type of such Investment in one or more of the above clauses.
Appears in 1 contract
Samples: Credit Agreement (LivaNova PLC)
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor the The Borrower willwill not, nor and will they not permit any Restricted Subsidiary or Intermediate Parent to, make or hold any Investment, except:
(a) Permitted Investments at the time such Permitted Investment is madeInvestments;
(b) (i) loans or advances to officers, directors directors, and employees of Holdings, any Intermediate Parentthe Borrower, the Borrower and the Restricted Subsidiaries (iA) for reasonable and customary business-related travel, entertainment, relocation relocation, and analogous ordinary business purposes, (iiB) in connection with such Person’s purchase of Equity Interests in of Holdings (or any direct or indirect parent thereof) (provided that the amount of such loans and advances made in cash to such Person shall be contributed to the Borrower in cash as common equity or Qualified Equity Interests) and (iiiC) for purposes not described in the foregoing clauses (i) and (ii); provided that at the time of incurrence thereof and after giving Pro Forma Effect thereto, the connection with compensation arrangements in an aggregate principal amount outstanding in reliance on this clause (iii) shall at any time the U.S. Dollar Equivalent of which does not exceed $1,000,000500,000, and (ii) Investments in respect of prepaid compensation arrangements containing clawback provisions in an aggregate amount which does not exceed $4,000,000;
(c) Investments (i) by Holdingsthe Borrower or any Restricted Subsidiary in the Borrower or any Loan Party (excluding any new Restricted Subsidiary that becomes a Loan Party pursuant to such Investment), (ii) by any Intermediate ParentRestricted Subsidiary that is not a Loan Party in any other Restricted Subsidiary that is also not a Loan Party, (iii) by the Borrower or any Restricted Subsidiary (A) in any Restricted Subsidiary; (B) in any Restricted Subsidiary that is not a Loan Party, constituting an exchange of Equity Interests of such Restricted Subsidiary for Indebtedness of such Subsidiary or (C) constituting Guarantees of Indebtedness or other monetary obligations of Restricted Subsidiaries that are not Loan Parties owing to any Loan Party, (iv) by the Borrower or any Restricted Subsidiary in Restricted Subsidiaries that are not Loan Parties so long as such Investment is part of a series of simultaneous Investments that result in the proceeds of the initial Investment being invested in one or more Loan Parties, and (v) by the Borrower or any Restricted Subsidiary in any Restricted Subsidiary that is not a Loan Party, consisting of Holdings, the contribution of Equity Interests of any Intermediate Parent, other Restricted Subsidiary that is not a Loan Party so long as the Equity Interests of the transferee Restricted Subsidiary are pledged to secure the Secured Obligations; provided the U.S. Dollar Equivalent of the aggregate amount of Investments by the Borrower or any Restricted Subsidiary; provided other Loan Party after the Closing Date pursuant to this Section 6.04(c) in Subsidiaries that the aggregate outstanding amount are not, shall not be, or, after giving effect to any such Investment, shall not become, Loan Parties shall not exceed $3,000,000 unless such excess is a result of Investments made by Loan Parties in Restricted such Subsidiaries that are not Loan Parties constituting intercompany loans pursuant to Section 6.01(a)(iv), and together with Investments made in reliance on this clause (c) such Subsidiaries constituting intercompany loans pursuant to Section 6.01(a)(iv), shall not exceed the greater of $10,000,000 and 35% of Consolidated EBITDA5,000,000;
(d) Investments consisting of prepayments to suppliers extensions of trade credit and accommodation guarantees in the ordinary course Ordinary Course of businessBusiness;
(e) Investments consisting of extensions of trade credit in the ordinary course of business;
(f) Investments (i) existing or contemplated on the date hereof Closing Date and set forth on Schedule 6.04(f6.04(e) and any modification, replacement, renewal, reinvestment or extension thereof and (ii) Investments existing on the date hereof Closing Date by Holdings, the Borrower or any Restricted Subsidiary in the Borrower or any Restricted Subsidiary and any modification, renewal renewal, or extension thereof; provided that the amount of the original Investment is not increased except by the terms of such Investment to the extent as set forth on Schedule 6.04(f6.04(e) or as otherwise permitted by this Section 6.04;
(gf) Investments in Swap Agreements permitted under Section 6.01(a)(vi)incurred in the Ordinary Course of Business and not for speculative purposes;
(hg) promissory notes and other non-cash consideration received in connection with Dispositions permitted by Section 6.05;
(ih) Permitted Acquisitions[Reserved];
(j) the Transactions;
(ki) Investments in the ordinary course Ordinary Course of business Business consisting of UCC Article 3 endorsements for collection or deposit and UCC Article 4 customary trade arrangements with customers consistent with past practices;
(lj) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers and customers, from financially troubled account debtors customers or in settlement of delinquent obligations of, or other disputes with, customers and suppliers or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment;
(mk) loans and advances to Holdings (or any direct or indirect parent thereof) or any Intermediate Parent in lieu of, and not in excess of the amount of (after giving effect to any other loans, advances or Restricted Payments in respect thereof), Restricted Payments to the extent permitted to be made to Holdings (or such parent) or such Intermediate Parent in accordance with Section 6.08(a6.07(a)(iii), (iv), (v) or (vii);
(n) additional Investments and other acquisitions; provided that at the time any such Investment or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition made in reliance on this clause (n), together with the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (n), shall not exceed the sum of (A) the greater of $18,000,000 and 60% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Investment or other acquisition, plus (B) so long as no Event of Default has occurred and is continuing, the Available Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of such Investment;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby;
(pl) advances of payroll payments to employees in the ordinary course Ordinary Course of businessBusiness;
(qm) Investments and other acquisitions to the extent that payment for such Investments is made solely with Qualified Equity Interests (excluding Cure Amounts) of Holdings (or any direct or indirect parent thereof or the IPO Entity); provided that (i) such amounts used pursuant to this clause (q) shall not increase the Available Amount and (ii) any amounts used for such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof or the IPO Entity) shall otherwise be permitted pursuant to this Section 6.04thereof);
(rn) Investments of a Subsidiary acquired after the Effective Date or of a Person merged or consolidated with any Subsidiary in accordance with this Section and Section 6.03 after the Effective Date to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger or consolidation and were in existence on the date of such acquisition, merger or consolidation[Reserved];
(so) receivables (other than in respect of Indebtedness for borrowed money) owing to the Borrower or any Restricted Subsidiary, if created or acquired in the Ordinary Course of Business;
(p) non-cash Investments in connection with tax planning and reorganization activities; provided that that, in the sole discretion of the Administrative Agent (following consultation with the Borrower), after giving effect to any such activities, the security interests of the Lenders in the Collateral, taken as a whole, would not be materially impaired;
(tq) Investments consisting of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference to this Section 6.04(t)) under Sections 6.01, 6.02, 6.03, 6.05 and 6.08, respectively;
(u) additional Investments; provided that after giving effect to such Investment (A) on a Pro Forma Basisfor utilities, security deposits, leases, and similar prepaid expenses incurred in the Total Net Leverage Ratio is less than or equal to 4.50 to 1.00 Ordinary Course of Business and (B) there is no continuing Event of Default;
(v) contributions to a “rabbi” trust for the benefit of employeestrade accounts created, directorsor prepaid expenses accrued, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors in the case Ordinary Course of a bankruptcy of Holdings or the Borrower;
(w) to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Property, or other rights, in each case in the ordinary course of business;
(x) Investments by an Unrestricted Subsidiary entered into prior to the day such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to the definition of “Unrestricted Subsidiary”;
(y) Investments consisting of purchases of assets of Franchisees (including, but not limited to, area development contracts owned by Franchisees) in the ordinary course of business or otherwise in an amount not exceeding $60,000,000, so long as (A) no Event of Default shall have occurred and be continuing and (B) the Borrower is in pro forma compliance with the Financial Covenant after giving effect to any such purchase;
(z) So long as no Event of Default shall have occurred and be continuing, Investments in Franchisees (including, but not limited to, (i) Guarantees or other credit support of any Indebtedness and other liabilities thereof and (ii) loans, advances or contributions to the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater of $20,000,000 and 70% of Consolidated EBITDA;
(aa) Investments consisting of accounts and payment intangibles owing to the Borrower or any of the Restricted Subsidiaries from Franchisees; provided that such obligation shall be on such terms as the Borrower or the applicable Restricted Subsidiary establishes in good faithBusiness; and
(bbr) [Reserved];
(s) other Investments consisting in an aggregate amount outstanding not to exceed $250,000 at any time; provided that, notwithstanding the foregoing provisions of advances or expenditures by any Loan Party to, or on behalf of, any CMF Subsidiary in support of advertising and marketing programs in the ordinary course consistent with current practices. For purposes of determining compliance with this Section 6.04, in no event shall this Section 6.04 permit the event Borrower or any Restricted Subsidiary to consummate any Disposition of, or otherwise transfer (whether through an in-kind Investment in or Restricted Payment to, or a merger or consolidation with a Person that is not the Borrower or a Subsidiary Loan Party, or otherwise) any item Material Intellectual Property (including any exclusive license thereof), or the Equity Interests of Investment meets any Person that owns or is the criteria exclusive licensee of more any Material Intellectual Property, to any other Person other than one of the categories of Investments described in clauses (a) through (bb) above, Holdings shallBorrower or a Subsidiary Loan Party, in its sole discretioneach case, classify and reclassify or later divide, classify or reclassify such Investment (or any portion thereof) and will only be required to include the amount and type of such Investment except as provided in one or more of the above clausesSection 6.03(e).
Appears in 1 contract
Samples: Super Senior Credit Agreement (CPI Card Group Inc.)
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor the Parent Borrower will, nor will they permit any Restricted Subsidiary or Intermediate Parent to, make or hold any Investment, except:
(a) Permitted Investments at the time such Permitted Investment is madeInvestments;
(b) loans or advances to officers, directors and employees of Holdings, any Intermediate Parent, the Parent Borrower and the its Restricted Subsidiaries (i) for reasonable and customary business-related travel, entertainment, relocation and analogous ordinary business purposes, (ii) in connection with such Person’s purchase of Equity Interests in Holdings (or any direct or indirect parent thereof) (provided that the amount of such loans and advances made in cash to such Person shall be contributed to the Borrower in cash as common equity or Qualified Equity Interests) and (iii) for purposes not described in the foregoing clauses (i) and (ii); provided that at the time of incurrence thereof and after giving Pro Forma Effect thereto, the aggregate principal amount outstanding in reliance on this clause (iii) shall not exceed $1,000,000;
(c) Investments (i) by Holdings, any Intermediate Parent, the Parent Borrower or any Restricted Subsidiary in any Loan Party (excluding any new Restricted Subsidiary that becomes a Loan Party pursuant to such Investment), (ii) by any Restricted Subsidiary that is not a Loan Party in any other Restricted Subsidiary that is also not a Loan Party, (iii) by the Parent Borrower or any Restricted Subsidiary (A) in any Restricted Subsidiary that is not a Loan Party, constituting an exchange of Equity Interests of such Restricted Subsidiary for Indebtedness of such Subsidiary or (B) constituting Guarantees of Indebtedness or other monetary obligations of Restricted Subsidiaries that are not Loan Parties owing to any Loan Party, (iv) by Holdings, any Intermediate Parent, the Parent Borrower or any Restricted Subsidiary; provided that the aggregate outstanding amount of Investments made by Loan Parties Subsidiary in Restricted Subsidiaries that are not Loan Parties so long as such transactions is part of a series of simultaneous transactions that result in reliance on this clause the proceeds of the initial Investment being invested in one or more Loan Parties (cor, if the initial proceeds were held at a Restricted Subsidiary that is not a Loan Party, a Restricted Subsidiary that is not a Loan Party) shall and (v) by Holdings, any Intermediate Parent, the Parent Borrower or any Restricted Subsidiary in any Restricted Subsidiary that is not exceed a Loan Party, consisting of the greater contribution of $10,000,000 and 35% Equity Interests of Consolidated EBITDAany other Restricted Subsidiary that is not a Loan Party so long as the Equity Interests of the transferee Restricted Subsidiary is pledged to secure the Secured Obligations;
(d) Investments consisting of prepayments to suppliers in the ordinary course of business;
(e) Investments consisting of extensions of trade credit in the ordinary course of business;
(fe) Investments (i) existing or contemplated on the date hereof Restatement Effective Date and set forth on Schedule 6.04(f6.04(e) and any modification, replacement, renewal, reinvestment or extension thereof and (ii) Investments existing on the date hereof Restatement Effective Date by Holdings, the Parent Borrower or any Restricted Subsidiary in the Parent Borrower or any Restricted Subsidiary and any modification, renewal or extension thereof; provided that the amount of the original Investment is not increased except by the terms of such Investment to the extent as set forth on Schedule 6.04(f6.04(e) or as otherwise permitted by this Section 6.04;
(gf) Investments in Swap Agreements permitted under Section 6.01(a)(vi)6.07;
(h) promissory notes and other non-cash consideration received in connection with Dispositions permitted by Section 6.05;
(i) Permitted Acquisitions;
(j) the Transactions;
(k) Investments in the ordinary course of business consisting of endorsements for collection or deposit and customary trade arrangements with customers consistent with past practices;
(l) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers and customers, from financially troubled account debtors or in settlement of delinquent obligations of, or other disputes with, customers and suppliers or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment;
(m) loans and advances to Holdings (or any direct or indirect parent thereof) or any Intermediate Parent in lieu of, and not in excess of the amount of (after giving effect to any other loans, advances or Restricted Payments in respect thereof), Restricted Payments to the extent permitted to be made to Holdings (or such parent) or such Intermediate Parent in accordance with Section 6.08(a);
(n) additional Investments and other acquisitions; provided that at the time any such Investment or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition made in reliance on this clause (n), together with the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (n), shall not exceed the sum of (A) the greater of $18,000,000 and 60% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Investment or other acquisition, plus (B) so long as no Event of Default has occurred and is continuing, the Available Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of such Investment;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby;
(p) advances of payroll payments to employees in the ordinary course of business;
(q) Investments and other acquisitions to the extent that payment for such Investments is made with Qualified Equity Interests (excluding Cure Amounts) of Holdings (or any direct or indirect parent thereof or the IPO Entity); provided that (i) such amounts used pursuant to this clause (q) shall not increase the Available Amount and (ii) any amounts used for such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof or the IPO Entity) shall otherwise be permitted pursuant to this Section 6.04;
(r) Investments of a Subsidiary acquired after the Effective Date or of a Person merged or consolidated with any Subsidiary in accordance with this Section and Section 6.03 after the Effective Date to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger or consolidation and were in existence on the date of such acquisition, merger or consolidation;
(s) non-cash Investments in connection with tax planning and reorganization activities; provided that after giving effect to any such activities, the security interests of the Lenders in the Collateral, taken as a whole, would not be materially impaired;
(t) Investments consisting of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference to this Section 6.04(t)) under Sections 6.01, 6.02, 6.03, 6.05 and 6.08, respectively;
(u) additional Investments; provided that after giving effect to such Investment (A) on a Pro Forma Basis, the Total Net Leverage Ratio is less than or equal to 4.50 to 1.00 and (B) there is no continuing Event of Default;
(v) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the Borrower;
(w) to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Property, or other rights, in each case in the ordinary course of business;
(x) Investments by an Unrestricted Subsidiary entered into prior to the day such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to the definition of “Unrestricted Subsidiary”;
(y) Investments consisting of purchases of assets of Franchisees (including, but not limited to, area development contracts owned by Franchisees) in the ordinary course of business or otherwise in an amount not exceeding $60,000,000, so long as (A) no Event of Default shall have occurred and be continuing and (B) the Borrower is in pro forma compliance with the Financial Covenant after giving effect to any such purchase;
(z) So long as no Event of Default shall have occurred and be continuing, Investments in Franchisees (including, but not limited to, (i) Guarantees or other credit support of any Indebtedness and other liabilities thereof and (ii) loans, advances or contributions to the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater of $20,000,000 and 70% of Consolidated EBITDA;
(aa) Investments consisting of accounts and payment intangibles owing to the Borrower or any of the Restricted Subsidiaries from Franchisees; provided that such obligation shall be on such terms as the Borrower or the applicable Restricted Subsidiary establishes in good faith; and
(bb) Investments consisting of advances or expenditures by any Loan Party to, or on behalf of, any CMF Subsidiary in support of advertising and marketing programs in the ordinary course consistent with current practices. For purposes of determining compliance with this Section 6.04, in the event that any item of Investment meets the criteria of more than one of the categories of Investments described in clauses (a) through (bb) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such Investment (or any portion thereof) and will only be required to include the amount and type of such Investment in one or more of the above clauses.
Appears in 1 contract
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor the (a) The Borrower willshall not, nor will they shall it permit any Restricted Subsidiary or Intermediate Parent of its Subsidiaries to, make or hold permit to remain outstanding any Investment, except:
(a) Permitted Investments at the time such Permitted Investment is made;
(b) loans or advances to officers, directors and employees of Holdings, any Intermediate Parent, the Borrower and the Restricted Subsidiaries except (i) for reasonable Investments outstanding on the date hereof and customary business-related travel, entertainment, relocation and analogous ordinary business purposesidentified in Part B of Schedule 3.06, (ii) in connection operating deposit accounts with such Person’s purchase of Equity Interests in Holdings (or any direct or indirect parent thereof) (provided that the amount of such loans and advances made in cash to such Person shall be contributed to the Borrower in cash as common equity or Qualified Equity Interests) and banks, (iii) for purposes not described securities accounts so long as the securities entitlements thereunder are in respect of Investments that otherwise conform to the foregoing clauses requirements of this Section 6.04 and trust accounts so long as the Investments held therein otherwise conform to the requirements of this Section 6.04, (iiv) and Permitted Investments, (ii); provided that at the time of incurrence thereof and after giving Pro Forma Effect thereto, the aggregate principal amount outstanding in reliance on this clause (iii) shall not exceed $1,000,000;
(cv) Investments by Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary and its Subsidiaries in any of Holdingstheir respective Subsidiaries, any Intermediate Parent, the Borrower or any Restricted Subsidiary; provided that the aggregate outstanding Dollar-equivalent amount of all Investments made by Loan Parties of the Borrower and its Domestic Subsidiaries in Restricted Foreign Subsidiaries that are not Loan Parties in reliance on this clause (c) shall not exceed $5,000,000 at any time, (vi) Hedging Agreements entered into for the greater purpose of $10,000,000 and 35% of Consolidated EBITDA;
(d) Investments consisting of prepayments hedging or mitigating risks to suppliers in the ordinary course of business;
(e) Investments consisting of extensions of trade credit in the ordinary course of business;
(f) Investments (i) existing or contemplated on the date hereof and set forth on Schedule 6.04(f) and any modification, replacement, renewal, reinvestment or extension thereof and (ii) Investments existing on the date hereof by Holdings, which the Borrower or any Restricted such Subsidiary is exposed in the conduct of its business or the management of its liabilities and, when considered in light of other outstanding Hedging Agreements to which the Borrower or any Restricted a Subsidiary and any modificationis party, renewal (A) does not expose the Borrower or extension thereof; provided that such Subsidiaries, as the case may be, to predominantly speculative risks unrelated to the amount of assets, Debt or other liabilities intended to be subject to coverage on a notional basis under such Hedging Agreements and (B) qualifies for hedge accounting under GAAP, including Statement No. 133 of the original Investment is not increased except by the terms of such Investment to the extent as set forth on Schedule 6.04(f) or as otherwise permitted by this Section 6.04;
Financial Accounting Standards Board, and (g) Investments in Swap Agreements permitted under Section 6.01(a)(vi);
(h) promissory notes and other non-cash consideration received in connection with Dispositions permitted by Section 6.05;
(ivii) Permitted Acquisitions;.
(jb) the Transactions;
(k) Investments in the ordinary course of business consisting of endorsements for collection or deposit and customary trade arrangements with customers consistent with past practices;
(l) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers and customers, from financially troubled account debtors or in settlement of delinquent obligations of, or other disputes with, customers and suppliers or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment;
(m) loans and advances to Holdings (or any direct or indirect parent thereof) or any Intermediate Parent in lieu of, and not in excess of the amount of (after giving effect to any other loans, advances or Restricted Payments in respect thereof), Restricted Payments to the extent permitted to be made to Holdings (or such parent) or such Intermediate Parent in accordance with Section 6.08(a);
(n) additional Investments and other acquisitions; provided that at the time any such Investment or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition made in reliance on this clause (n), together with the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (n), The Borrower shall not exceed the sum of (A) the greater of $18,000,000 and 60% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect permit any Insurance Company to the making of such make any Investment or other acquisitionif, plus (B) so long as no Event of Default has occurred and is continuing, the Available Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of such Investment;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby;
(p) advances of payroll payments to employees in the ordinary course of business;
(q) Investments and other acquisitions to the extent that payment for such Investments is made with Qualified Equity Interests (excluding Cure Amounts) of Holdings (or any direct or indirect parent thereof or the IPO Entity); provided that (i) such amounts used pursuant to this clause (q) shall not increase the Available Amount and (ii) any amounts used for such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof or the IPO Entity) shall otherwise be permitted pursuant to this Section 6.04;
(r) Investments of a Subsidiary acquired after the Effective Date or of a Person merged or consolidated with any Subsidiary in accordance with this Section and Section 6.03 after the Effective Date to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger or consolidation and were in existence on the date of which such acquisition, merger or consolidation;
(s) non-cash Investments in connection with tax planning Investment is made and reorganization activities; provided that after giving effect to any such activitiesthereto, the security interests aggregate value of the Lenders in the Collateral, taken as a whole, would not be materially impaired;
(t) Investments consisting of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than equity Investments) held by reference to this Section 6.04(t)) under Sections 6.01, 6.02, 6.03, 6.05 such Insurance Company and 6.08, respectively;
(u) additional Investments; provided all of the other Insurance Companies taken together that after giving effect to such Investment (A) on a Pro Forma Basis, are rated lower than “2” by the Total Net Leverage Ratio is less than NAIC or equal to 4.50 to 1.00 and (B) there is no continuing Event are not rated by the NAIC would exceed 15.0% of Default;
(v) contributions to a “rabbi” trust for the benefit value of employees, directors, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the Borrower;
(w) to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Property, or other rights, in each case in the ordinary course of business;
(x) Investments by an Unrestricted Subsidiary entered into prior to the day such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to the definition of “Unrestricted Subsidiary”;
(y) Investments consisting of purchases of total invested assets of Franchisees (including, but not limited to, area development contracts owned by Franchisees) in the ordinary course of business or otherwise in an amount not exceeding $60,000,000, so long as (A) no Event of Default shall have occurred and be continuing and (B) the Borrower is in pro forma compliance with the Financial Covenant after giving effect to any such purchase;
(z) So long as no Event of Default shall have occurred and be continuing, Investments in Franchisees (including, but not limited to, (i) Guarantees or other credit support of any Indebtedness and other liabilities thereof and (ii) loans, advances or contributions to the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater of $20,000,000 and 70% of Consolidated EBITDA;
(aa) Investments consisting of accounts and payment intangibles owing to the Borrower or any all of the Restricted Subsidiaries from Franchisees; provided that such obligation shall be on such terms as the Borrower or the applicable Restricted Subsidiary establishes Insurance 68 Companies. As used in good faith; and
(bb) Investments consisting of advances or expenditures by any Loan Party to, or on behalf of, any CMF Subsidiary in support of advertising and marketing programs in the ordinary course consistent with current practices. For purposes of determining compliance with this Section 6.04, in the event that any item “value” of an Investment meets refers to the criteria of more than one of the categories of Investments described in clauses (a) through (bb) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such Investment (or any portion thereof) and will only be required to include the amount and type value of such Investment in one or more that would be shown on the most recent Statutory Statement of the above clausesrelevant Insurance Company prepared in accordance with SAP.
Appears in 1 contract
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor the The Lead Borrower willwill not, nor and will they not permit any of its Restricted Subsidiary or Intermediate Parent Subsidiaries to, make or hold any InvestmentInvestment except (collectively, except:“Permitted Investments”):
(a) Permitted cash, Cash Equivalents and Investments at the time in assets that were Cash Equivalents when such Permitted Investment is was made;
(b) loans or advances to present or former officers, directors directors, managers, members of management and employees of Holdings, any Intermediate Parent, the Lead Borrower and the Restricted Subsidiaries (i) for reasonable and customary business-related travel, entertainment, relocation and analogous ordinary business purposes, purposes and (ii) in connection with such Person’s purchase of Equity Interests in Holdings such Borrower (or any direct or indirect parent thereof) (provided that the amount of such loans and advances made in cash to such Person shall be contributed to the such Borrower in cash as common equity or Qualified Equity Interests) and (iii) for purposes not described in the foregoing clauses );
(i) and (ii); provided that at the time of incurrence thereof and after giving Pro Forma Effect thereto, the aggregate principal amount outstanding in reliance on this clause (iii) shall not exceed $1,000,000;
(c) Investments by Holdings, any Intermediate Parent, the Lead Borrower or any Restricted Subsidiary in any of Holdings, Domestic Loan Party; (ii) Investments by any Intermediate Parent, Restricted Subsidiary that is not a Loan Party in any other Restricted Subsidiary that is also not a Loan Party; (iii) Investments by the Lead Borrower or any Restricted Subsidiary in any Restricted Subsidiary; provided that the aggregate outstanding amount of such Investments made by Loan Parties after the Closing Date in Restricted Subsidiaries that are not Domestic Loan Parties in reliance on this clause (c) iii), shall not exceed at any time outstanding the greater of (x) $10,000,000 250,000,000 and 35(y) 5.50% of Consolidated EBITDA;
Total Assets (das determined at the time such Investment is made); (iv) Investments consisting by any Foreign Borrower in any Loan Party; (v) other intercompany liabilities amongst the Lead Borrower and the other Domestic Loan Parties incurred in the ordinary course of prepayments business that are unsecured and subordinated to suppliers the Obligations; (vi) other intercompany liabilities amongst Restricted Subsidiaries that are not Loan Parties incurred in the ordinary course of business;
; and (evii) Investments consisting of extensions of trade credit in the ordinary course of business;
(f) Investments (i) existing or contemplated on the date hereof and set forth on Schedule 6.04(f) and any modification, replacement, renewal, reinvestment or extension thereof and (ii) Investments existing on the date hereof by Holdings, the Borrower or any Restricted Subsidiary in the Borrower or any Restricted Subsidiary and any modification, renewal or extension thereof; provided that the amount of the original Investment is not increased except by the terms of such Investment to the extent as set forth on Schedule 6.04(f) or as otherwise permitted by this Section 6.04;
(g) Investments in Swap Agreements permitted under Section 6.01(a)(vi);
(h) promissory notes and other non-cash consideration received in connection with Dispositions permitted by Section 6.05;
(i) Permitted Acquisitions;
(j) the Transactions;
(k) Investments in the ordinary course of business consisting of endorsements for collection or deposit and customary trade arrangements with customers consistent with past practices;
(l) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers and customers, from financially troubled account debtors or in settlement of delinquent obligations of, or other disputes with, customers and suppliers or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment;
(m) loans and advances to Holdings (or any direct or indirect parent thereof) or any Intermediate Parent in lieu of, and not in excess of the amount of (after giving effect to any other loans, advances or Restricted Payments in respect thereof), Restricted Payments to the extent permitted to be made to Holdings (or such parent) or such Intermediate Parent in accordance with Section 6.08(a);
(n) additional Investments and other acquisitions; provided that at the time any such Investment or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition made in reliance on this clause (n), together with the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (n), shall not exceed the sum of (A) the greater of $18,000,000 and 60% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Investment or other acquisition, plus (B) so long as no Event of Default has occurred and is continuing, the Available Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of such Investment;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby;
(p) advances of payroll payments to employees in the ordinary course of business;
(q) Investments and other acquisitions to the extent that payment for such Investments is made with Qualified Equity Interests (excluding Cure Amounts) of Holdings (or any direct or indirect parent thereof or the IPO Entity); provided that (i) such amounts used pursuant to this clause (q) shall not increase the Available Amount and (ii) any amounts used for such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof or the IPO Entity) shall otherwise be permitted pursuant to this Section 6.04;
(r) Investments of a Subsidiary acquired after the Effective Date or of a Person merged or consolidated with any Subsidiary in accordance with this Section and Section 6.03 after the Effective Date to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger or consolidation and were in existence on the date of such acquisition, merger or consolidation;
(s) non-cash Investments in connection with tax planning and reorganization activities; provided that after giving effect to any such activities, the security interests of the Lenders in the Collateral, taken as a whole, would not be materially impaired;
(t) Investments consisting of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference to this Section 6.04(t)) under Sections 6.01, 6.02, 6.03, 6.05 and 6.08, respectively;
(u) additional Investments; provided that after giving effect to such Investment (A) on a Pro Forma Basis, the Total Net Leverage Ratio is less than or equal to 4.50 to 1.00 and (B) there is no continuing Event of Default;
(v) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the Borrower;
(w) to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Property, or other rights, in each case in the ordinary course of business;
(x) Investments by an Unrestricted Subsidiary entered into prior to the day such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to the definition of “Unrestricted Subsidiary”;
(y) Investments consisting of purchases of assets of Franchisees (including, but not limited to, area development contracts owned by Franchisees) in the ordinary course of business or otherwise in an amount not exceeding $60,000,000, so long as (A) no Event of Default shall have occurred and be continuing and (B) the Borrower is in pro forma compliance with the Financial Covenant after giving effect to any such purchase;
(z) So long as no Event of Default shall have occurred and be continuing, Investments in Franchisees (including, but not limited to, (i) Guarantees or other credit support of any Indebtedness and other liabilities thereof and (ii) loans, advances or contributions to the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater of $20,000,000 and 70% of Consolidated EBITDA;
(aa) Investments consisting of accounts and payment intangibles owing to the Borrower or any of the Restricted Subsidiaries from Franchisees; provided that such obligation shall be on such terms as the Borrower or the applicable Restricted Subsidiary establishes in good faith; and
(bb) Investments consisting of advances or expenditures by any Loan Party to, or on behalf of, in any CMF Restricted Subsidiary in support of advertising and marketing programs in the ordinary course consistent with current practices. For purposes of determining compliance with this Section 6.04, in the event that any item of Investment meets the criteria of more than one is not a Loan Party consisting solely of the categories contribution of Investments described Equity Interests of any other Restricted Subsidiary that is not a Loan Party held directly by a Domestic Loan Party in clauses (a) through (bb) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such Investment exchange for Equity Interests (or any portion thereofadditional share premium or paid in capital in respect of Equity Interests) and will only be required of the Restricted Subsidiary to include which such contribution is made; provided, that immediately following the amount and type consummation of an Investment pursuant to the preceding clause (vii), the Restricted Subsidiary whose Equity Interests are the subject of such Investment in one or more of the above clauses.remains a Restricted Subsidiary;
Appears in 1 contract
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor the Borrower willwill not, nor will they it permit any Restricted Subsidiary or Intermediate Parent to, make or hold any Investment, except:
(a) Permitted Investments made in the Blocked Borrower to facilitate payments of interest, scheduled principal, fees and expenses due in connection with any Loan Documents;
(b) Investments in cash and Cash Equivalents at the time such Permitted Investment in Cash Equivalent is made;
(bc) loans or advances to present or former officers, directors directors, managers, members of management, consultants, independent contractors and employees of Holdings, any Intermediate Parent, the Borrower Parent Entity and the Restricted Subsidiaries (i) for reasonable and customary business-related travel, entertainment, relocation and analogous ordinary business purposes, (ii) in connection with such Person’s purchase of Equity Interests in Holdings (or any direct or indirect parent thereofParent Entity) (provided that the amount of such loans and advances made in cash to such Person shall be contributed to the Borrower Holdings or any Restricted Subsidiary in cash as common equity or Qualified Equity Interests) and (iii) for purposes not described in the foregoing clauses (i) and (ii); provided that at the time of incurrence thereof and after giving Pro Forma Effect thereto, the aggregate principal amount outstanding in reliance on this clause (iii) shall not exceed $1,000,00025,000,000;
(cd) Investments (i) by Holdings or any Restricted Subsidiary in any Loan Party (other than Holdings), (ii) by any Intermediate Parent, Restricted Subsidiary that is not a Loan Party in any other Restricted Subsidiary that is also not a Loan Party and (iii) by the Borrower or any Restricted Subsidiary in any of Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary; provided that the aggregate outstanding amount of such Investments made by Loan Parties after the Closing Date in Restricted Subsidiaries that are not Loan Parties in reliance on this clause (c) iii), shall not exceed exceed, at the time of incurrence thereof and after giving Pro Forma Effect thereto, the greater of $10,000,000 175,000,000 and 3520.0% of Consolidated EBITDAEBITDA for the most recently ended Test Period as of such time;
(de) Investments consisting of deposits, prepayments and/or other credits to suppliers in the ordinary course of business;
(ef) Investments consisting of extensions of trade credit in the ordinary course of business;
(fg) Investments (i) existing or contemplated on the date hereof and set forth on Schedule 6.04(f6.04(g) and any modification, replacement, renewal, reinvestment or extension thereof and (ii) Investments existing on the date hereof by Holdings, the Borrower or any Restricted Subsidiary in the Borrower Holdings or any Restricted Subsidiary and any modification, renewal or extension thereof; provided that the amount of the original Investment is not increased except by the terms of such Investment to the extent as set forth on Schedule 6.04(f6.04(g) or as otherwise permitted by this Section 6.04;
(g) Investments in Swap Agreements permitted under Section 6.01(a)(vi);
(h) promissory notes and other non-cash consideration received in connection with Dispositions permitted by Section 6.05;
(i) Permitted Acquisitions;
(j) the Transactions;
(k) Investments in the ordinary course of business consisting of endorsements for collection or deposit and customary trade arrangements with customers consistent with past practices;
(l) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers and customers, from financially troubled account debtors or in settlement of delinquent obligations of, or other disputes with, customers and suppliers or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment;
(m) loans and advances to Holdings (or any direct or indirect parent thereof) or any Intermediate Parent in lieu of, and not in excess of the amount of (after giving effect to any other loans, advances or Restricted Payments in respect thereof), Restricted Payments to the extent permitted to be made to Holdings (or such parent) or such Intermediate Parent in accordance with Section 6.08(a);
(n) additional Investments and other acquisitions; provided that at the time any such Investment or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition made in reliance on this clause (n), together with the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (n), shall not exceed the sum of (A) the greater of $18,000,000 and 60% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Investment or other acquisition, plus (B) so long as no Event of Default has occurred and is continuing, the Available Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of such Investment;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby;
(p) advances of payroll payments to employees in the ordinary course of business;
(q) Investments and other acquisitions to the extent that payment for such Investments is made with Qualified Equity Interests (excluding Cure Amounts) of Holdings (or any direct or indirect parent thereof or the IPO Entity); provided that (i) such amounts used pursuant to this clause (q) shall not increase the Available Amount and (ii) any amounts used for such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof or the IPO Entity) shall otherwise be permitted pursuant to this Section 6.04;
(r) Investments of a Subsidiary acquired after the Effective Date or of a Person merged or consolidated with any Subsidiary in accordance with this Section and Section 6.03 after the Effective Date to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger or consolidation and were in existence on the date of such acquisition, merger or consolidation;
(s) non-cash Investments in connection with tax planning and reorganization activities; provided that after giving effect to any such activities, the security interests of the Lenders in the Collateral, taken as a whole, would not be materially impaired;
(t) Investments consisting of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference to this Section 6.04(t)) under Sections 6.01, 6.02, 6.03, 6.05 and 6.08, respectively;
(u) additional Investments; provided that after giving effect to such Investment (A) on a Pro Forma Basis, the Total Net Leverage Ratio is less than or equal to 4.50 to 1.00 and (B) there is no continuing Event of Default;
(v) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the Borrower;
(w) to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Property, or other rights, in each case in the ordinary course of business;
(x) Investments by an Unrestricted Subsidiary entered into prior to the day such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to the definition of “Unrestricted Subsidiary”;
(y) Investments consisting of purchases of assets of Franchisees (including, but not limited to, area development contracts owned by Franchisees) in the ordinary course of business or otherwise in an amount not exceeding $60,000,000, so long as (A) no Event of Default shall have occurred and be continuing and (B) the Borrower is in pro forma compliance with the Financial Covenant after giving effect to any such purchase;
(z) So long as no Event of Default shall have occurred and be continuing, Investments in Franchisees (including, but not limited to, (i) Guarantees or other credit support of any Indebtedness and other liabilities thereof and (ii) loans, advances or contributions to the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater of $20,000,000 and 70% of Consolidated EBITDA;
(aa) Investments consisting of accounts and payment intangibles owing to the Borrower or any of the Restricted Subsidiaries from Franchisees; provided that such obligation shall be on such terms as the Borrower or the applicable Restricted Subsidiary establishes in good faith; and
(bb) Investments consisting of advances or expenditures by any Loan Party to, or on behalf of, any CMF Subsidiary in support of advertising and marketing programs in the ordinary course consistent with current practices. For purposes of determining compliance with this Section 6.04, in the event that any item of Investment meets the criteria of more than one of the categories of Investments described in clauses (a) through (bb) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such Investment (or any portion thereof) and will only be required to include the amount and type of such Investment in one or more of the above clauses.
Appears in 1 contract
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor the The Borrower willwill not, nor and will they not permit any Restricted Subsidiary or Intermediate Parent to, of the Subsidiaries to make or hold permit to exist any Investment, Investment except:
(a) Permitted Investments at and Investments by Foreign Subsidiaries which are held or made outside the time such United States of the same or similar quality as the Permitted Investment is madeInvestments;
(b) loans or advances to officers, directors and employees of Holdings, any Intermediate Parent, the Borrower and the Restricted Subsidiaries (i) for reasonable and customary business-related travelInvestments existing on the Effective Date (which if greater than $1,000,000, entertainmentindividually, relocation and analogous ordinary business purposes, (ii) is set forth in connection with such Person’s purchase of Equity Interests in Holdings (or any direct or indirect parent thereof) (provided that the amount of such loans and advances made in cash to such Person shall be contributed to the Borrower in cash as common equity or Qualified Equity Interests) and (iii) for purposes not described in the foregoing clauses (iSchedule 6.04) and (ii); provided that at ) Investments purchased with the time proceeds of incurrence thereof and after giving Pro Forma Effect thereto, the aggregate principal amount outstanding in reliance on sale of any Investments permitted under this clause (iii) shall not exceed $1,000,000Agreement;
(c) Investments (i) by HoldingsBorrower or any Subsidiary in, any Intermediate Parent, and the purchase by the Borrower or any Restricted Subsidiary in of, Equity Interests of any of Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary; provided that the aggregate outstanding amount of Investments made by Subsidiary Guarantor and (ii) among Loan Parties in Restricted Subsidiaries that are not Loan Parties in reliance on this clause (c) shall not exceed the greater of $10,000,000 and 35% of Consolidated EBITDAParties;
(d) Investments consisting of prepayments to suppliers in the ordinary course of business(Reserved);
(e) Investments consisting Loans and advances to officers, directors, and employees of extensions of trade credit in the ordinary course of business;
(f) Investments Borrower and its Subsidiaries (i) existing or contemplated on the date hereof and set forth on Schedule 6.04(f) and any modification, replacement, renewal, reinvestment or extension thereof and (ii) Investments existing on the date hereof by Holdings, the Borrower or any Restricted Subsidiary in the Borrower or any Restricted Subsidiary and any modification, renewal or extension thereof; provided that the amount of the original Investment is not increased except by the terms of such Investment to the extent as set forth on Schedule 6.04(f) or as otherwise permitted by this Section 6.04;
(g) Investments in Swap Agreements permitted under Section 6.01(a)(vi);
(h) promissory notes and other non-cash consideration received in connection with Dispositions permitted by Section 6.05;
(i) Permitted Acquisitions;
(j) the Transactions;
(k) Investments for business expenses incurred in the ordinary course of business consisting or (ii) (x) the net proceeds of endorsements which are used solely to purchase Equity Interests in the Borrower pursuant to a restricted stock or stock purchase plan or (y) for collection or deposit other purposes so long as the aggregate outstanding amount incurred under clauses (x) and customary trade arrangements with customers consistent with past practices(y) does not exceed $10,000,000 at any time;
(lf) the Borrower or any Subsidiary (the "Acquiring Company") may acquire assets constituting a business unit of any Subsidiary (a "Transferring Subsidiary") if the Acquiring Company assumes all the Transferring Subsidiary's liabilities, including all liabilities of the Transferring Subsidiary under the Loan Documents to which it is a party and if all of the capital stock of the Transferring Subsidiary is owned directly or indirectly by the Acquiring Company (and, following such assignment and assumption, such Transferring Subsidiary may wind up, dissolve and liquidate) except that no Foreign Subsidiary may acquire assets of a Domestic Subsidiary in such a transaction;
(g) if no Default exists or would result therefrom, a Permitted Acquisition if, after giving pro forma effect to any Indebtedness and EBITDA of the Person to be acquired or to the assets to be acquired as of such date, either (i) the Borrower shall have a Leverage Ratio of no more than 3.25 to 1.00 calculated as of the last day of the most recently-ended fiscal quarter of Borrower as if the proposed acquisition had occurred on the first day of the four fiscal quarter period ending on the last day of such fiscal quarter, or (ii) if such Leverage Ratio as so calculated is more than 3.25 to 1.00, then, with respect to this clause (ii), the Purchase Price for the proposed acquisition in question (as determined on the date of such proposed acquisition) together with the Purchase Prices paid for all Permitted Acquisitions pursuant to this Section 6.04(g)(ii) consummated in the same fiscal year of the Borrower does not exceed a Dollar Amount equal to $125,000,000;
(h) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers and customersof, from financially troubled account debtors or in settlement of delinquent obligations of, or other accounts and disputes with, customers and suppliers or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment;
(m) loans and advances to Holdings (or any direct or indirect parent thereof) or any Intermediate Parent in lieu of, and not in excess of the amount of (after giving effect to any other loans, advances or Restricted Payments in respect thereof), Restricted Payments to the extent permitted to be made to Holdings (or such parent) or such Intermediate Parent in accordance with Section 6.08(a);
(n) additional Investments and other acquisitions; provided that at the time any such Investment or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition made in reliance on this clause (n), together with the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (n), shall not exceed the sum of (A) the greater of $18,000,000 and 60% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Investment or other acquisition, plus (B) so long as no Event of Default has occurred and is continuing, the Available Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of such Investment;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby;
(p) advances of payroll payments to employees in the ordinary course of business;
(q) Investments and other acquisitions to the extent that payment for such Investments is made with Qualified Equity Interests (excluding Cure Amounts) of Holdings (or any direct or indirect parent thereof or the IPO Entity); provided that (i) such amounts used pursuant to this clause (q) shall not increase the Available Amount and (ii) any amounts used for such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof or the IPO Entity) shall otherwise be permitted pursuant to this Section 6.04;
(r) Investments of a Subsidiary acquired after the Effective Date or of a Person merged or consolidated with any Subsidiary in accordance with this Section and Section 6.03 after the Effective Date to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger or consolidation and were in existence on the date of such acquisition, merger or consolidation;
(s) non-cash Investments in connection with tax planning and reorganization activities; provided that after giving effect to any such activities, the security interests of the Lenders in the Collateral, taken as a whole, would not be materially impaired;
(t) Investments consisting of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference to this Section 6.04(t)) under Sections 6.01, 6.02, 6.03, 6.05 and 6.08, respectively;
(u) additional Investments; provided that after giving effect to such Investment (A) on a Pro Forma Basis, the Total Net Leverage Ratio is less than or equal to 4.50 to 1.00 and (B) there is no continuing Event of Default;
(v) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the Borrower;
(w) to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Property, or other rightssuppliers, in each case in the ordinary course of business;
(x) Investments by an Unrestricted Subsidiary entered into prior to the day such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to the definition of “Unrestricted Subsidiary”;
(yi) Investments consisting of purchases the licensing or contribution of assets of Franchisees (including, but not limited to, area development contracts owned by Franchisees) in the ordinary course of business or otherwise in an amount not exceeding $60,000,000, so long as (A) no Event of Default shall have occurred and be continuing and (B) the Borrower is in pro forma compliance intellectual property pursuant to joint marketing arrangements with the Financial Covenant after giving effect to any such purchaseother Persons;
(zj) So long as no Event of Default shall have occurred and be continuing, Investments in Franchisees the form of Swap Agreements permitted by Section 6.10;
(including, but not limited to, k) Investments received in connection with (i) Guarantees or other credit support the disposition of any Indebtedness and other liabilities thereof and asset permitted by Section 6.05 or (ii) loansmergers, advances consolidations, amalgamations, liquidations, windings up or contributions dissolutions permitted under Section 6.03 (subject to the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater requirements of $20,000,000 and 70% of Consolidated EBITDASection 6.04(f));
(aal) Investments consisting to the extent the consideration paid therefore consists of accounts and payment intangibles owing to common Equity Interests of the Borrower or any of its Subsidiaries, in each case, to the Restricted Subsidiaries from Franchisees; provided that such obligation shall be on such terms as the Borrower or the applicable Restricted Subsidiary establishes extent not resulting in good faitha Change in Control; and
(bbm) other Investments consisting by the Borrower or any Subsidiary; provided that as of advances the date of any such proposed Investment and after giving effect thereto, no Default exists and either:
(i) the Leverage Ratio is less than or expenditures by any Loan Party toequal to 3.00 to 1.00 calculated on a pro forma basis as of the last day of the most recently-ended fiscal quarter of Borrower as if the Investment had occurred on the first day of the Test Period ending on the last day of such fiscal quarter, or on behalf ofor
(ii) if such Leverage Ratio as so calculated for such date is more 3.00 to 1.00, any CMF Subsidiary in support then, with respect to this clause (m):
(A) the Dollar Amount of advertising and marketing programs the Outstanding Investments made pursuant to this paragraph (m)(ii) shall not exceed $75,000,000 in the ordinary course consistent aggregate with current practices. For purposes respect to Investments in Subsidiaries that are not or do not become Subsidiary Guarantors, and
(B) the Dollar Amount of determining compliance the Outstanding Investments made pursuant to this paragraph (m)(ii) shall not exceed $50,000,000 in the aggregate with respect to Investments in Persons who are not Subsidiaries; and To the extent that any Investment could be attributable to more than one subsection of this Section 6.04, in the event that Borrower may allocate (and from time to time reallocate) such Investments to any item of Investment meets the criteria of more than one of the categories of Investments described in clauses (a) through (bb) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such Investment (or any portion thereof) and will only be required to include the amount and type of such Investment in one or more of such subsections and in no event shall the above clausessame portion of an Investment be deemed to utilize or be attributable to more than one item.
Appears in 1 contract
Samples: Credit Agreement (Acxiom Corp)
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor the Borrower will, nor will they permit any Restricted Subsidiary or Intermediate Parent to, make or hold any Investment, except:
(a) Permitted Investments at the time such Permitted Investment is madeInvestments;
(b) loans or advances to officers, directors and employees of Holdings, any Intermediate Parent, the Borrower and the its Restricted Subsidiaries (i) for reasonable and customary business-related travel, entertainment, relocation and analogous ordinary business purposes, (ii) in connection with such Person’s purchase of Equity Interests in of Holdings (or any direct or indirect parent thereofthereof or any Employee Holding Vehicle) (provided that the amount of such loans and advances made in cash to such Person shall be contributed to the Borrower in cash as common equity or Qualified Equity Interests) and (iii) for purposes not described in the foregoing clauses (i) and (ii); provided that at the time of incurrence thereof and after giving Pro Forma Effect thereto, the in an aggregate principal amount outstanding at any time not to exceed $5,000,000;
(c) Investments (i) by Holdings, the Borrower or any Restricted Subsidiary in any Loan Party (excluding any new Restricted Subsidiary that becomes a Loan Party pursuant to such Investment), (ii) by any Restricted Subsidiary that is not a Loan Party in any other Restricted Subsidiary that is also not a Loan Party, (iii) by Holdings or any Restricted Subsidiary (A) in any Restricted Subsidiary; provided that the aggregate amount of such Investments made by Loan Parties after the Restatement Effective Date in Restricted Subsidiaries that are not Loan Parties in reliance on this clause (iiiiii)(A) (including any such Investments deemed to be made pursuant to Section 6.14) (together with the amount of Investments made in Restricted Subsidiaries (other than Regulated Subsidiaries) that are not Loan Parties pursuant to Section 6.04(h) and the amount of Investments and acquisitions made pursuant to Section 6.04(m), in each case, after the Restatement Effective Date) shall not exceed $1,000,000;
the Non-Loan Party Investment Amount at the time of any such Investment, (cB) Investments in any Regulated Subsidiary in the form of short-term intercompany advances and Indebtedness, in each case made in the ordinary course of business to provide for working capital and other operational requirements of such Regulated Subsidiary, (C) in any Restricted Subsidiary that is not a Loan Party, constituting an exchange of Equity Interests of such Restricted Subsidiary for Indebtedness of such Subsidiary, (D) constituting Guarantees of Indebtedness or other monetary obligations of Restricted Subsidiaries that are not Loan Parties owing to any Loan Party or (E) constituting unsecured Guarantees of Trading Debt to the extent such Guarantees are permitted under Section 6.01(a)(iii), (1) by Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary in any of Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary; provided that the aggregate outstanding amount of Investments made by Loan Parties in Restricted Subsidiaries that are not Loan Parties so long as such Investment is part of a series of simultaneous transactions that result in reliance on this clause the proceeds of the initial transaction being invested in one or more Loan Parties or, if the proceeds were initially held by a non-Loan Party, in a Restricted Subsidiary that is not a Loan Party and (civ) shall by Holdings, the Borrower or any Restricted Subsidiary in any Restricted Subsidiary that is not exceed a Loan Party, consisting of the greater contribution of $10,000,000 and 35% Equity Interests of Consolidated EBITDAany other Restricted Subsidiary that is not a Loan Party so long as the Equity Interests of the transferee Restricted Subsidiary is pledged to secure the Secured Obligations;
(d) Investments consisting of prepayments to suppliers in the ordinary course of business;
(e) Investments consisting of extensions of trade credit in the ordinary course of business;
(fe) Investments (i) existing or contemplated on the date hereof Restatement Effective Date and set forth on Schedule 6.04(f6.04(e) and any modification, replacement, renewal, reinvestment or extension thereof and (ii) Investments existing on the date hereof Restatement Effective Date by Holdings, the Borrower or any Restricted Subsidiary in the Borrower or any Restricted Subsidiary and any modification, renewal or extension thereof; provided that in each case the amount of the original Investment is not increased except by the terms of such Investment to the extent as set forth on Schedule 6.04(f6.04(e) or as otherwise permitted by this Section 6.04;
(gf) Investments in Swap Agreements permitted under Section 6.01(a)(vi)6.07;
(hg) promissory notes and other non-cash consideration received in connection with Dispositions permitted by Section 6.05;
(ih) Permitted Acquisitions; provided that the aggregate amount of consideration paid or provided by Holdings, any Intermediate Parent, the Borrower or any other Loan Party (including any Indebtedness incurred by any such Person to finance any portion of such consideration) after the Restatement Effective Date in reliance on this Section 6.04(h) (together with any Investments made in Subsidiaries that are not Loan Parties pursuant to Section 6.04(c)(iii)(A), Investments deemed to be made pursuant to Section 6.14 and the amount of Investments and acquisitions made pursuant to Section 6.04(m), in each case, after the Restatement Effective Date) for Permitted Acquisitions (including the aggregate principal amount of all Indebtedness assumed in connection with Permitted Acquisitions) of any Restricted Subsidiary (other than a Regulated Subsidiary) that shall not be or, after giving effect to such Permitted Acquisition, shall not become, a Loan Party, shall not exceed the Non-Loan Party Investment Amount at such time;
(i) prior to the Escrow Assumption Date, Investments in the Escrow Borrower to fund interest and other amounts owing or required to be pre-funded with respect to the Escrow Term Loans and, to the extent applicable, interest and other amounts owing or required to be pre-funded in respect of the Second Lien Notes;
(j) the Transactions;
(k) Investments in the ordinary course of business consisting of Uniform Commercial Code Article 3 endorsements for collection or deposit and Uniform Commercial Code Article 4 customary trade arrangements with customers consistent with past practices;
(lk) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers and customers, from financially troubled account debtors customers or in settlement of delinquent obligations of, or other disputes with, customers and suppliers or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment;
(ml) loans and advances to Holdings (or any direct or indirect parent thereof) or any Intermediate Parent in lieu of, and not in excess of the amount of (after giving effect to any other loans, advances or Restricted Payments in respect thereof), Restricted Payments to the extent permitted to be made to Holdings (or such parent) or such Intermediate Parent in accordance with Section 6.08(a6.08(a)(iv), (v), (vi), (vii) or (viii);
(nm) additional so long as immediately after giving effect to any such Investment or acquisition no Default shall have occurred and be continuing, other Investments and other acquisitions; provided that at the time any such Investment (including any such Investments deemed to be made pursuant to Section 6.14) or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition all Investments made in reliance on this clause (nm) (including all such Investments deemed made pursuant to Section 6.14), Investments made in Subsidiaries that are not Loan Parties pursuant to Section 6.04(c)(iii)(A) and Investments made in Restricted Subsidiaries (other than Regulated Subsidiaries) that are not Loan Parties pursuant to Section 6.04(h), together with the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (nm) (including the aggregate principal amount of all Indebtedness assumed in connection with any such other acquisition), in each case, after the Restatement Effective Date, shall not exceed the sum Non-Loan Party Investment Amount at the time of (A) the greater of $18,000,000 and 60% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of any such Investment or other acquisition, plus (B) so long as no Event of Default has occurred and is continuing, the Available Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of such Investment;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby;
(pn) advances of payroll payments to employees in the ordinary course of business;
(qo) Investments and other acquisitions to the extent that payment for such Investments is made solely with Qualified Equity Interests (excluding Cure Amounts) of Holdings (or any direct or indirect parent thereof or the IPO Entitythereof); provided that (i) such amounts used pursuant to this clause (q) shall not increase the Available Amount and (ii) any amounts used for such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof or the IPO Entity) shall otherwise be permitted pursuant to this Section 6.04;
(r) Investments of a Subsidiary acquired after the Effective Date or of a Person merged or consolidated with any Subsidiary in accordance with this Section and Section 6.03 after the Effective Date to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger or consolidation and were in existence on the date of such acquisition, merger or consolidation;
(s) non-cash Investments in connection with tax planning and reorganization activities; provided that after giving effect to any such activities, the security interests of the Lenders in the Collateral, taken as a whole, would not be materially impaired;
(t) Investments consisting of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference to this Section 6.04(t)) under Sections 6.01, 6.02, 6.03, 6.05 and 6.08, respectively;
(u) additional Investments; provided that after giving effect to such Investment (A) on a Pro Forma Basis, the Total Net Leverage Ratio is less than or equal to 4.50 to 1.00 and (B) there is no continuing Event of Default;
(v) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the Borrower;
(w) to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Property, or other rights, in each case in the ordinary course of business;
(x) Investments by an Unrestricted Subsidiary entered into prior to the day such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to the definition of “Unrestricted Subsidiary”;
(y) Investments consisting of purchases of assets of Franchisees (including, but not limited to, area development contracts owned by Franchisees) in the ordinary course of business or otherwise in an amount not exceeding $60,000,000, so long as (A) no Event of Default shall have occurred and be continuing and (B) the Borrower is in pro forma compliance with the Financial Covenant after giving effect to any such purchase;
(z) So long as no Event of Default shall have occurred and be continuing, Investments in Franchisees (including, but not limited to, (i) Guarantees or other credit support of any Indebtedness and other liabilities thereof and (ii) loans, advances or contributions to the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater of $20,000,000 and 70% of Consolidated EBITDA;
(aa) Investments consisting of accounts and payment intangibles owing to the Borrower or any of the Restricted Subsidiaries from Franchisees; provided that such obligation shall be on such terms as the Borrower or the applicable Restricted Subsidiary establishes in good faith; and
(bb) Investments consisting of advances or expenditures by any Loan Party to, or on behalf of, any CMF Subsidiary in support of advertising and marketing programs in the ordinary course consistent with current practices. For purposes of determining compliance with this Section 6.04, in the event that any item of Investment meets the criteria of more than one of the categories of Investments described in clauses (a) through (bb) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such Investment (or any portion thereof) and will only be required to include the amount and type of such Investment in one or more of the above clauses.
Appears in 1 contract
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor the The Borrower willshall not, nor will they and shall not permit any Restricted Subsidiary or Intermediate Parent to, make purchase, hold or hold acquire (including pursuant to any merger with any Person that was not a Wholly Owned Subsidiary prior to such merger) any Investment, except:
(a) Permitted Investments at the time such Permitted Investment is madeCash Equivalent Investments;
(b) loans Investments made (i) by the Borrower in or to any existing Wholly Owned Subsidiary Guarantor and (ii) by any Restricted Subsidiary in or to the Borrower or any existing Wholly Owned Subsidiary Guarantor;
(c) Investments of a type not otherwise described in this Section 6.6 in an aggregate amount not to exceed $2,500,000;
(d) Guarantees constituting Indebtedness permitted by Section 6.2 (provided that only Guarantors may guarantee Indebtedness described in Section 6.2(k));
(e) advances to officers, directors and employees of Holdings, any Intermediate Parent, the Borrower and the Restricted Subsidiaries (i) in an aggregate amount not to exceed $250,000 at any time outstanding, for reasonable and customary business-related travel, entertainment, relocation and analogous ordinary business purposes, (ii) in connection with such Person’s purchase of Equity Interests in Holdings (or any direct or indirect parent thereof) (provided that the amount of such loans and advances made in cash to such Person shall be contributed to the Borrower in cash as common equity or Qualified Equity Interests) and (iii) for purposes not described in the foregoing clauses (i) and (ii); provided that at the time of incurrence thereof and after giving Pro Forma Effect thereto, the aggregate principal amount outstanding in reliance on this clause (iii) shall not exceed $1,000,000;
(cf) Investments by Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary in any of Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary; provided that the aggregate outstanding amount of Investments made by Loan Parties in Restricted Subsidiaries that are not Loan Parties in reliance on this clause (c) shall not exceed the greater of $10,000,000 and 35% of Consolidated EBITDA;
(d) Investments consisting of prepayments to suppliers bank deposits in the ordinary course of business;
(eg) Investments consisting of extensions of credit in the nature of accounts receivable or notes receivable arising from the grant of trade credit in the ordinary course of business;
(f) , and Investments (i) existing received in satisfaction or contemplated on the date hereof and set forth on Schedule 6.04(f) and any modification, replacement, renewal, reinvestment or extension partial satisfaction thereof and (ii) Investments existing on the date hereof by Holdings, the Borrower or any Restricted Subsidiary in the Borrower or any Restricted Subsidiary and any modification, renewal or extension thereof; provided that the amount of the original Investment is not increased except by the terms of such Investment from financially troubled account debtors to the extent as set forth on Schedule 6.04(f) reasonably necessary in order to prevent or as otherwise permitted by this Section 6.04;
(g) Investments in Swap Agreements permitted under Section 6.01(a)(vi)limit loss;
(h) promissory notes and other non-cash consideration received received, to the extent permitted by the Loan Documents, in connection with Dispositions the Disposition of property permitted by this Agreement, provided that any Oil and Gas Properties received as non-cash consideration shall comply with Section 6.056.6(j); and any Equity Interests received as non-cash consideration shall comply with Section 6.10 and the proviso to this Section 6.6;
(i) Permitted AcquisitionsInvestments listed on Schedule 6.6 as of the Effective Date;
(j) Investments in direct ownership interests in additional Oil and Gas Properties of the Transactions;Borrower and its Restricted Subsidiaries and gas gathering systems related thereto or related to farm-out, farm-in, joint operating, or area of mutual interest agreements, gathering systems, pipelines or other similar arrangements which are usual and customary in the oil and gas exploration and production business located within the United States; and
(k) Investments made after the Effective Date in the ordinary course of business consisting of endorsements for collection or deposit and customary trade arrangements with customers consistent with past practices;
(l) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers and customersUnrestricted Subsidiaries, from financially troubled account debtors or in settlement of delinquent obligations of, or other disputes with, customers and suppliers or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment;
(m) loans and advances to Holdings (or any direct or indirect parent thereof) or any Intermediate Parent in lieu of, and not in excess of the amount of (after giving effect to any other loans, advances or Restricted Payments in respect thereof), Restricted Payments to the extent permitted to be made to Holdings (or such parent) or such Intermediate Parent in accordance with Section 6.08(a);
(n) additional Investments and other acquisitions; provided that at the time any such Investment or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition made in reliance on this clause (n), together with the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (n), shall not exceed the sum of (A) the greater of $18,000,000 and 60% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Investment or other acquisition, plus (B) so long as no Event of Default has occurred and is continuing, the Available Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of such Investment;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby;
(p) advances of payroll payments to employees in the ordinary course of business;
(q) Investments and other acquisitions to the extent that payment for such Investments is made with Qualified Equity Interests (excluding Cure Amounts) of Holdings (or any direct or indirect parent thereof or the IPO Entity); provided that (i) such amounts used pursuant to this clause (q) shall not increase the Available Amount Investment is on fair and reasonable terms and (ii) any amounts used for such an Investment or other acquisition that are not Qualified Equity Interests the aggregate amount of Holdings (or any direct or indirect parent thereof or the IPO Entity) shall otherwise be permitted pursuant to this Section 6.04;
(r) Investments of a Subsidiary acquired after the Effective Date or of a Person merged or consolidated with any Subsidiary in accordance with this Section and Section 6.03 after the Effective Date to the extent that such Investments were not made in contemplation (valued as of or in connection with such acquisition, merger or consolidation and were in existence on the date of such acquisitionInvestment) do not exceed an amount equal to $2,500,000; and provided, merger or consolidation;
(s) non-cash Investments in connection with tax planning further, that both before and reorganization activities; provided that after giving effect to any such activities, the security interests of the Lenders in the Collateral, taken as a whole, would not be materially impaired;
(t) Investments consisting of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference to this Section 6.04(t)) under Sections 6.01, 6.02, 6.03, 6.05 and 6.08, respectively;
(u) additional Investments; provided that after giving effect to such Investment (A) on a Pro Forma Basis, the Total Net Leverage Ratio is less than or equal to 4.50 to 1.00 and (B) there is no continuing Event of Default;
(v) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the Borrower;
(w) pro forma basis acceptable to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Property, or other rights, in each case in the ordinary course of business;
(x) Investments by an Unrestricted Subsidiary entered into prior to the day such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to the definition of “Unrestricted Subsidiary”;
(y) Investments consisting of purchases of assets of Franchisees (including, but not limited to, area development contracts owned by Franchisees) in the ordinary course of business or otherwise in an amount not exceeding $60,000,000, so long as (AAdministrative Agent) no Default or Event of Default shall have occurred and be continuing and all representations and warranties contained in Article III hereof shall be true and correct in all material respects as if made both immediately before and immediately after the time of such Investment (B) the Borrower is in pro forma compliance with the Financial Covenant after giving effect or, if stated to any have been made expressly as of an earlier date, were true and correct as of such purchasedate);
(z) So long as no Event of Default shall have occurred and be continuing, Investments in Franchisees (including, but not limited to, (i) Guarantees or other credit support that any Investment that when made complies with the requirements of any Indebtedness and other liabilities thereof the definition of the term “Cash Equivalent Investment” may continue to be held notwithstanding that such Investment if made thereafter would not comply with such requirements and (ii) loans, advances notwithstanding anything in this Section 6.6 or contributions elsewhere in this Agreement to the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater of $20,000,000 and 70% of Consolidated EBITDA;
(aa) Investments consisting of accounts and payment intangibles owing to the Borrower or any of the Restricted Subsidiaries from Franchisees; provided that such obligation contrary, no Investment shall be on such terms as the Borrower permitted in any venture or the applicable Restricted Subsidiary establishes in good faith; and
(bb) Investments consisting of advances or expenditures by any Loan Party toUnrestricted Subsidiary, or on behalf ofunless, any CMF Subsidiary in support of advertising and marketing programs in the ordinary course consistent with current practices. For purposes of determining compliance with this Section 6.04, in the event that any item of Investment meets the criteria of more than one of the categories of Investments described in clauses (a) through (bb) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such Investment does not include any Collateral (other than cash or any portion thereof) and will only be required to include the amount and type of such Investment in one or more of the above clausesCash Equivalent Investments).
Appears in 1 contract
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor the Borrower willThe Company will not, nor and will they not permit any Restricted Subsidiary or Intermediate Parent of the Subsidiaries to, make or hold any Investment, Investment except:
(a) Permitted Investments at the time such Permitted Investment is madeInvestments;
(b) loans or advances to officers, directors and employees Investments of Holdings, any Intermediate Parent, the Borrower Company and the Restricted Subsidiaries (i) for reasonable and customary business-related travel, entertainment, relocation and analogous ordinary business purposes, (ii) in connection with such Person’s purchase Subsidiary Securities Parties that are set forth on Schedule 6.04 of Equity Interests in Holdings (or any direct or indirect parent thereof) (provided that the amount of such loans and advances made in cash to such Person shall be contributed to the Borrower in cash as common equity or Qualified Equity Interests) and (iii) for purposes not described in the foregoing clauses (i) and (ii); provided that at the time of incurrence thereof and after giving Pro Forma Effect thereto, the aggregate principal amount outstanding in reliance on this clause (iii) shall not exceed $1,000,000ABL Credit Agreement;
(c) Investments Guarantees of Debt and/or Guarantees consisting of Debt permitted by Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary in any of Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary; provided that the aggregate outstanding amount of Investments made by Loan Parties in Restricted Subsidiaries that are not Loan Parties in reliance on this clause (c) shall not exceed the greater of $10,000,000 and 35% of Consolidated EBITDASection 4.03;
(d) Investments consisting of prepayments to suppliers in the ordinary course of business;
(e) Investments consisting of extensions of trade credit in the ordinary course of business;
(f) Investments (i) existing or contemplated on the date hereof and set forth on Schedule 6.04(f) and any modification, replacement, renewal, reinvestment or extension thereof and (ii) Investments existing on the date hereof by Holdings, the Borrower or any Restricted Subsidiary in the Borrower or any Restricted Subsidiary and any modification, renewal or extension thereof; provided that the amount of the original Investment is not increased except by the terms of such Investment to the extent as set forth on Schedule 6.04(f) or as otherwise permitted by this Section 6.04;
(g) Investments in Swap Agreements permitted under Section 6.01(a)(vi);
(h) promissory notes and other non-cash consideration received in connection with Dispositions permitted by Section 6.05;
(i) Permitted Acquisitions;
(j) the Transactions;
(k) Investments in the ordinary course of business consisting of endorsements for collection or deposit and customary trade arrangements with customers consistent with past practices;
(l) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers and customersof, from financially troubled account debtors or in settlement of delinquent obligations of, or other accounts and disputes with, customers and suppliers or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment;
(m) loans and advances to Holdings (or any direct or indirect parent thereof) or any Intermediate Parent in lieu of, and not in excess of the amount of (after giving effect to any other loans, advances or Restricted Payments in respect thereof), Restricted Payments to the extent permitted to be made to Holdings (or such parent) or such Intermediate Parent in accordance with Section 6.08(a);
(n) additional Investments and other acquisitions; provided that at the time any such Investment or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition made in reliance on this clause (n), together with the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (n), shall not exceed the sum of (A) the greater of $18,000,000 and 60% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Investment or other acquisition, plus (B) so long as no Event of Default has occurred and is continuing, the Available Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of such Investment;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby;
(p) advances of payroll payments to employees in the ordinary course of business;
(q) Investments and other acquisitions to the extent that payment for such Investments is made with Qualified Equity Interests (excluding Cure Amounts) of Holdings (or any direct or indirect parent thereof or the IPO Entity); provided that (i) such amounts used pursuant to this clause (q) shall not increase the Available Amount and (ii) any amounts used for such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof or the IPO Entity) shall otherwise be permitted pursuant to this Section 6.04;
(r) Investments of a Subsidiary acquired after the Effective Date or of a Person merged or consolidated with any Subsidiary in accordance with this Section and Section 6.03 after the Effective Date to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger or consolidation and were in existence on the date of such acquisition, merger or consolidation;
(s) non-cash Investments in connection with tax planning and reorganization activities; provided that after giving effect to any such activities, the security interests of the Lenders in the Collateral, taken as a whole, would not be materially impaired;
(t) Investments consisting of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference to this Section 6.04(t)) under Sections 6.01, 6.02, 6.03, 6.05 and 6.08, respectively;
(u) additional Investments; provided that after giving effect to such Investment (A) on a Pro Forma Basis, the Total Net Leverage Ratio is less than or equal to 4.50 to 1.00 and (B) there is no continuing Event of Default;
(v) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the Borrower;
(w) to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Property, or other rightssuppliers, in each case in the ordinary course of business;
(xi) Investments by the Company or any Subsidiary Guarantor in Subsidiary Securities Parties; provided that the Company and such Subsidiary Guarantor, as the case may be, shall comply with the applicable provisions of Section 4.08 with respect to any newly formed Subsidiary, (ii) Investments by the Subsidiaries in the Company; provided that the proceeds of such Investments are used for general corporate and ongoing working capital purposes, (iii) Investments by any Subsidiary that is not a Subsidiary Guarantor in any other Subsidiary that is not a Subsidiary Guarantor or in any Subsidiary Guarantor, and (iv) other Investments by the Company or any Subsidiary Guarantor in any Subsidiary that is not a Subsidiary Guarantor in an Unrestricted Subsidiary entered into prior amount not to exceed $20.0 million in the day such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to the definition of “Unrestricted Subsidiary”aggregate at any one time;
(yf) Investments consisting of purchases non-cash consideration received in connection with any Asset Sale permitted by Section 4.06 (other than with respect to any sale of assets of Franchisees (including, but not limited to, area development contracts owned by Franchisees) Inventory at retail in the ordinary course of business or otherwise business);
(g) usual and customary loans and advances to employees, officers and directors of the Company and the Subsidiaries, in the ordinary course of business; provided that the aggregate amount of such loans and advances outstanding at any time shall not exceed $11,000,000;
(h) Investments in charitable foundations organized under Section 501(c) of the Code in an amount not exceeding to exceed $60,000,0003,300,000 in the aggregate in any calendar year;
(i) any Investment consisting of a Hedging Agreement permitted by Section 4.14;
(j) Investments held by any Person that becomes a Subsidiary at the time such Person becomes a Subsidiary; provided that no such Investment was made in contemplation of such Person becoming a Subsidiary;
(k) Investments consisting of Guarantees by the Company or any of its Subsidiaries of obligations of the Company or any of its Subsidiaries to the extent not constituting Debt and incurred in the ordinary course of business;
(l) Business Acquisitions and other Investments that are not otherwise permitted under any other provision of this Section 4.10; provided that, as of the date of such Business Acquisition or other Investment, and after giving effect thereto, each of the Payment Conditions shall be satisfied;
(m) Investments in Permitted Joint Ventures that do not exceed $25.0 million (with the Fair Market Value of each Investment being measured at the time made and without giving effect to subsequent changes in value);
(n) Investments in an amount not to exceed the Available Amount;
(o) Repurchases of the Securities and the Rollover Notes;
(p) Investments in a Related Business (with the Fair Market Value of each Investment being measured at the time made and without giving effect to subsequent changes in value) not to exceed $25.0 million; provided that if any Investment pursuant to this clause (p) is made in any Person that is not a Subsidiary at the date of the making of such Investment and such Person becomes a Subsidiary after such date, such Investment shall thereafter be deemed to have been made pursuant to clause (e) above and shall cease to have been made pursuant to this clause (p) for so long as (A) no Event of Default shall have occurred and such Person continues to be continuing and (B) the Borrower is in pro forma compliance with the Financial Covenant after giving effect to any such purchasea Subsidiary;
(zq) So so long as no Event of Default shall have occurred then exists or would result therefrom, additional Investments so long as the Consolidated Total Leverage Ratio as of the last day of the most recently ended Measurement Period (and be continuing, calculated giving Pro Forma Effect to such Restricted Payment and as if such Restricted Payment was made as the last day of the most recently ended Measurement Period) is equal to or greater than 5.75 to 1.00;
(r) Investments in Franchisees (including, but not limited to, (i) Guarantees or other credit support of any Indebtedness and other liabilities thereof and (ii) loans, advances or contributions to the marketing and advertising funds operating Receivables Entities required in connection with a Qualified Receivables Transaction (including the European Wax Center franchise systems) not contribution or lending of cash and cash equivalents to exceed Receivables Entities to finance the greater purchase of $20,000,000 and 70% of Consolidated EBITDA;
(aa) Investments consisting of accounts and payment intangibles owing to assets from the Borrower Company or any of the Restricted Subsidiaries from Franchisees; provided that such obligation shall be on such terms as the Borrower Subsidiary or the applicable Restricted Subsidiary establishes in good faithto otherwise fund required reserves); and
(bbs) other Investments consisting of advances or expenditures by outstanding at any Loan Party to, or on behalf of, any CMF Subsidiary in support of advertising and marketing programs one time in the ordinary course consistent aggregate that do not exceed $[50.0] million (with current practicesthe Fair Market Value of each Investment being measured at the time made and without giving effect to subsequent changes in value). For purposes of determining compliance with this Section 6.044.10, in the event that any item of a proposed Investment (or a portion thereof) meets the criteria of more than one of the categories of Investments described in clauses (a) through (bbs) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such Investment (or any portion thereof) and will only be required to include the amount and type of such Investment in above and/or one or more of the above clausesclauses contained in the definition of “Permitted Investments,” the Company may divide or classify or later divide or reclassify (based on circumstances existing on the date of such reclassification) such Investment (or a portion thereof) between such clauses (a) through (s) and one or more of the clauses contained in the definition of “Permitted Investments,” in any manner that otherwise complies with this Section 4.10.
Appears in 1 contract
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor the Borrower willParent will not, nor and will they not permit any Restricted Subsidiary to, directly or Intermediate Parent toindirectly, make or hold any Investment, except:
(a) Permitted Investments at the time such Permitted Investment is madeInvestments;
(b) Investments existing on the Closing Date and set forth on Schedule 6.04;
(c) Investments (i) by Parent or any Restricted Subsidiary in any existing Loan Party, (ii) by any Restricted Subsidiary that is not a Loan Party in any other existing Restricted Subsidiary that is also not a Loan Party, (iii) by Parent or any Restricted Subsidiary (A) in any existing Restricted Subsidiary; provided that the aggregate amount of such Investments made by Loan Parties after the Closing Date in Restricted Subsidiaries that are not Loan Parties in reliance on this subclause (iii)(A) shall not exceed, at any time outstanding, an amount equal to the greater of $75,000,000 and 30% of Consolidated EBITDA for the most recently ended Test Period or (B) in any existing Restricted Subsidiary that is not a Loan Party, constituting an exchange of Equity Interests of such Restricted Subsidiary for Indebtedness of such Restricted Subsidiary, (iv) by Parent or any Restricted Subsidiary in Restricted Subsidiaries that are not Loan Parties so long as such Investment is part of a series of simultaneous Investments that result in the proceeds of the initial Investment being invested in one or more Loan Parties and (v) by Parent or any Restricted Subsidiary in any existing Restricted Subsidiary that is not a Loan Party, consisting of the contribution of Equity Interests of any other Restricted Subsidiary that is not a Loan Party;
(d) Seed Capital Investments in an aggregate amount not to exceed the greater of $50,000,000 and 20% of Consolidated EBITDA for the most recently ended Test Period;
(e) Investments in any Restricted Subsidiary that is a Broker-Dealer Subsidiary to the extent necessary in order for such Restricted Subsidiary to be in compliance with its net capital requirements under any Requirements of Laws;
(f) Permitted Acquisitions;
(g) other Investments in an aggregate amount at any time outstanding not to exceed the sum of (i) the greater of $100,000,000 and 40% of Consolidated EBITDA for the most recently ended Test Period and (ii) so long as no Event of Default shall have occurred and be continuing or shall result therefrom, the Available Amount;
(h) other Investments; provided that (i) no Event of Default shall have occurred and be continuing or shall result therefrom and (ii) the Total Net Leverage Ratio shall be less than 2.25:1.00;
(i) the Acquisition;
(j) Investments in Swap Agreements permitted by Section 6.01(p);
(k) loans or advances to officers, directors and employees of Holdings, Parent or any Intermediate Parent, the Borrower and the Restricted Subsidiaries Subsidiary (i) for advance of payroll and reasonable and customary business-related travel, entertainment, relocation and analogous ordinary business purposespurposes of Parent and its Restricted Subsidiaries, (ii) in connection with such Person’s purchase of Equity Interests in Holdings (of Parent or any direct or indirect parent thereof) (provided that the amount of such loans and advances made in cash to such Person shall be contributed to the Borrower in cash as common equity or Qualified (other than Disqualified Equity Interests) and (iii) for purposes not described in the foregoing clauses (i) and (ii); provided that at the time of incurrence thereof and after giving Pro Forma Effect thereto, the aggregate principal amount outstanding in reliance on at any time under this clause subclause (iii) shall not exceed $1,000,0005,000,000;
(c) Investments by Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary in any of Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary; provided that the aggregate outstanding amount of Investments made by Loan Parties in Restricted Subsidiaries that are not Loan Parties in reliance on this clause (c) shall not exceed the greater of $10,000,000 and 35% of Consolidated EBITDA;
(d) Investments consisting of prepayments to suppliers in the ordinary course of business;
(e) Investments consisting of extensions of trade credit in the ordinary course of business;
(f) Investments (i) existing or contemplated on the date hereof and set forth on Schedule 6.04(f) and any modification, replacement, renewal, reinvestment or extension thereof and (ii) Investments existing on the date hereof by Holdings, the Borrower or any Restricted Subsidiary in the Borrower or any Restricted Subsidiary and any modification, renewal or extension thereof; provided that the amount of the original Investment is not increased except by the terms of such Investment to the extent as set forth on Schedule 6.04(f) or as otherwise permitted by this Section 6.04;
(g) Investments in Swap Agreements permitted under Section 6.01(a)(vi);
(hl) promissory notes and other non-cash consideration received in connection with Dispositions permitted by Section 6.05;
(i) Permitted Acquisitions;
(j) the Transactions;
(km) Investments in the ordinary course of business consisting of Uniform Commercial Code Article 3 endorsements for collection or deposit and Uniform Commercial Code Article 4 customary trade arrangements with customers consistent with past practices;
(ln) Investments for (including debt obligations i) utilities, security deposits, leases and Equity Interestssimilar prepaid expenses incurred in the ordinary course of business and (ii) received in connection with the bankruptcy or reorganization of suppliers and customers, from financially troubled account debtors or in settlement of delinquent obligations oftrade accounts created, or other disputes withprepaid expenses accrued, customers and suppliers or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment;
(m) loans and advances to Holdings (or any direct or indirect parent thereof) or any Intermediate Parent in lieu of, and not in excess of the amount of (after giving effect to any other loans, advances or Restricted Payments in respect thereof), Restricted Payments to the extent permitted to be made to Holdings (or such parent) or such Intermediate Parent in accordance with Section 6.08(a);
(n) additional Investments and other acquisitions; provided that at the time any such Investment or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition made in reliance on this clause (n), together with the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (n), shall not exceed the sum of (A) the greater of $18,000,000 and 60% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Investment or other acquisition, plus (B) so long as no Event of Default has occurred and is continuing, the Available Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of such Investment;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby;
(p) advances of payroll payments to employees in the ordinary course of business;; and
(qo) Investments and other acquisitions to the extent that payment for such Investments is made with Qualified Equity Interests (excluding Cure Amounts) consisting of Holdings (or any direct or indirect parent thereof or the IPO Entity); provided that (i) such amounts used pursuant to this clause (q) shall not increase the Available Amount cash in deposit accounts with financial institutions available for withdrawal on demand and (ii) any amounts used for such an Investment or other acquisition that are not Qualified Equity Interests extensions of Holdings (or any direct or indirect parent thereof or the IPO Entity) shall otherwise be permitted pursuant to this Section 6.04;
(r) Investments of a Subsidiary acquired after the Effective Date or of a Person merged or consolidated with any Subsidiary in accordance with this Section and Section 6.03 after the Effective Date to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger or consolidation and were in existence on the date of such acquisition, merger or consolidation;
(s) non-cash Investments in connection with tax planning and reorganization activities; provided that after giving effect to any such activities, the security interests of the Lenders credit in the Collateralnature of accounts receivable arising from the grant of trade credit, taken as a whole, would not be materially impaired;
(t) and Investments consisting of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference to this Section 6.04(t)) under Sections 6.01, 6.02, 6.03, 6.05 and 6.08, respectively;
(u) additional Investments; provided that after giving effect to such Investment (A) on a Pro Forma Basis, the Total Net Leverage Ratio is less than received in satisfaction or equal to 4.50 to 1.00 and (B) there is no continuing Event of Default;
(v) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the Borrower;
(w) to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Property, or other rightspartial satisfaction thereof from financially troubled account debtors, in each case case, made or incurred in the ordinary course of business;
(x) Investments by an Unrestricted Subsidiary entered into prior to the day such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to the definition of “Unrestricted Subsidiary”;
(y) Investments consisting of purchases of assets of Franchisees (including, but not limited to, area development contracts owned by Franchisees) in the ordinary course of business or otherwise in an amount not exceeding $60,000,000, so long as (A) no Event of Default shall have occurred and be continuing and (B) the Borrower is in pro forma compliance with the Financial Covenant after giving effect to any such purchase;
(z) So long as no Event of Default shall have occurred and be continuing, Investments in Franchisees (including, but not limited to, (i) Guarantees or other credit support of any Indebtedness and other liabilities thereof and (ii) loans, advances or contributions to the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater of $20,000,000 and 70% of Consolidated EBITDA;
(aa) Investments consisting of accounts and payment intangibles owing to the Borrower or any of the Restricted Subsidiaries from Franchisees; provided that such obligation shall be on such terms as the Borrower or the applicable Restricted Subsidiary establishes in good faith; and
(bb) Investments consisting of advances or expenditures by any Loan Party to, or on behalf of, any CMF Subsidiary in support of advertising and marketing programs in the ordinary course consistent with current practices. For purposes of determining compliance with this Section 6.04, in the event that any item of Investment meets the criteria of more than one of the categories of Investments described in clauses (a) through (bb) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such Investment (or any portion thereof) and will only be required to include the amount and type of such Investment in one or more of the above clauses.
Appears in 1 contract
Samples: Term Loan Credit Agreement (NorthStar Asset Management Group Inc.)
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor and the Borrower willwill not, nor and will they not permit any Restricted Subsidiary or Intermediate Parent to, make or hold any Investment, except:
(a) Permitted Investments at the time such Permitted Investment is madeInvestments;
(b) loans or advances to officers, directors and employees of Holdings, any Intermediate Parent, the Borrower Holdings and the its Restricted Subsidiaries (i) for reasonable and customary business-related travel, entertainment, relocation and analogous ordinary business purposes, (ii) in connection with such Person’s purchase of Equity Interests in of Holdings (or any direct or indirect parent thereof) (provided that the amount of such loans and advances made in cash to such Person shall be contributed to the Borrower in cash as common equity or Qualified Equity Interests) and (iii) for purposes not described in the foregoing clauses (i) and (ii); provided that at the time of incurrence thereof and after giving Pro Forma Effect thereto, the in an aggregate principal amount outstanding in reliance on this clause (iii) shall at any time not to exceed $1,000,0002,500,000;
(c) Investments (i) by Holdings, any Intermediate Parent, the Borrower Holdings or any Restricted Subsidiary in any of HoldingsLoan Party (excluding any new Restricted Subsidiary that becomes a Loan Party pursuant to such Investment), (ii) by any Intermediate ParentRestricted Subsidiary that is not a Loan Party in any other Restricted Subsidiary that is also not a Loan Party, the Borrower (iii) by Holdings or any Restricted Subsidiary (A) in any Restricted Subsidiary; provided that the aggregate outstanding amount of such Investments made by Loan Parties after the Effective Date in Restricted Subsidiaries that are not Loan Parties in reliance on this clause (ciii)(A) (together with the amount of Investments made in Restricted Subsidiaries that are not Loan Parties pursuant to Section 6.04(h)) shall not exceed the greater Non-Loan Party Investment Amount at the time of $10,000,000 any such Investment, (B) in any Restricted Subsidiary that is not a Loan Party, constituting an exchange of Equity Interests of such Subsidiary for Indebtedness of such Restricted Subsidiary or (C) constituting Guarantees of Indebtedness or other monetary obligations of Restricted Subsidiaries that are not Loan Parties owing to any Loan Party, (iv) by Holdings or any Restricted Subsidiary in Restricted Subsidiaries that are not Loan Parties so long as such Investment is part of a series of simultaneous Investments that result in the proceeds of the initial Investment being invested in one or more Loan Parties and 35% (v) by Holdings or any Restricted Subsidiary in any Restricted Subsidiary that is not a Loan Party, consisting of Consolidated EBITDAthe contribution of Equity Interests of any other Restricted Subsidiary that is not a Loan Party so long as the Equity Interests of the transferee Restricted Subsidiary are pledged to secure the Secured Obligations;
(d) Investments consisting of prepayments to suppliers extensions of trade credit and accommodation guarantees in the ordinary course of business;
(e) Investments consisting of extensions of trade credit in the ordinary course of business;
(f) Investments (i) existing or contemplated on the date hereof Effective Date and set forth on Schedule 6.04(f6.04(e) and any modification, replacement, renewal, reinvestment or extension thereof and (ii) Investments existing on the date hereof Effective Date by Holdings, the Borrower Holdings or any Restricted Subsidiary in the Borrower Holdings or any Restricted Subsidiary and any modification, renewal or extension thereof; provided that the amount of the original Investment is not increased except by the terms of such Investment to the extent as set forth on Schedule 6.04(f6.04(e) or as otherwise permitted by this Section 6.04;
(gf) Investments in Swap Agreements permitted under Section 6.01(a)(vi)incurred in the ordinary course of business and not for speculative purposes;
(hg) promissory notes and other non-cash consideration received in connection with Dispositions permitted by Section 6.05;
(ih) Permitted Acquisitions; provided that the aggregate amount of consideration paid or provided by the Borrower or any other Loan Party after the Effective Date in reliance on this Section 6.04(h) (together with any Investments made in Subsidiaries that are not Loan Parties pursuant to Section 6.04(c)(iii)(A)) for Permitted Acquisitions (including the aggregate principal amount of all Indebtedness assumed in connection with Permitted Acquisitions) for any Restricted Subsidiary that shall not be or, after giving effect to such Permitted Acquisition, shall not become a Loan Party, shall not exceed the Non-Loan Party Investment Amount at such time;
(ji) the Transactions;
(kj) Investments in the ordinary course of business consisting of Uniform Commercial Code Article 3 endorsements for collection or deposit and Uniform Commercial Code Article 4 customary trade arrangements with customers consistent with past practices;
(lk) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers and customers, from financially troubled account debtors customers or in settlement of delinquent obligations of, or other disputes with, customers and suppliers or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment;
(l) [Reserved];
(m) loans and advances to Holdings (or any direct or indirect parent thereof) or any Intermediate Parent in lieu of, and not in excess of the amount of (so long as immediately after giving effect to any such Investment no Event of Default has occurred and is continuing, other loans, advances or Restricted Payments in respect thereof), Restricted Payments to the extent permitted to be made to Holdings (or such parent) or such Intermediate Parent in accordance with Section 6.08(a);
(n) additional Investments and other acquisitions; provided that at the time any such Investment or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition all Investments made in reliance on this clause (nm) (including all such Investments deemed to be made pursuant to clause (d) of the definition of “Non-Loan Party Investment Amount”), together with the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (nm) (including the aggregate principal amount of all Indebtedness assumed in connection with any such other acquisition), shall not exceed the sum of (Aw) the greater of $18,000,000 and 60% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Investment or other acquisition, 25,000,000 plus (Bx) so long as no Event the Borrower shall be in Pro Forma Compliance with the Financial Performance Covenant as of Default has occurred and is continuingthe end of the most recent Test Period, the Available Amount amount of Cumulative Excess Cash Flow that is Not Otherwise Applied as plus (y) the aggregate amount of the Net Proceeds of the issuance of, or contribution of cash in effect immediately prior respect of existing Qualified Equity Interests, in each case after the Effective Date (other than any such issuance or contribution made pursuant to the time of making of such InvestmentSection 7.02), that is Not Otherwise Applied;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby;
(pn) advances of payroll payments to employees in the ordinary course of business;
(qo) Investments and other acquisitions to the extent that payment for such Investments is made solely with Qualified Equity Interests (excluding Cure Amounts) of Holdings (or any direct or indirect parent thereof or the IPO Entity); provided that (i) such amounts used pursuant to this clause (q) shall not increase the Available Amount and (ii) any amounts used for such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof or the IPO Entity) shall otherwise be permitted pursuant to this Section 6.04Holdings;
(rp) Investments of a Subsidiary acquired after the Effective Date or of a Person merged or consolidated with any Subsidiary in accordance with this Section 6.04 and Section 6.03 after the Effective Date or that otherwise becomes a Subsidiary (provided that if such Investment is made under Section 6.04(h), existing Investments in subsidiaries of such Subsidiary or Person shall comply with the requirements of Section 6.04(h) or 6.04(m) or any other paragraph of this Section 6.04) to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger or consolidation and were in existence on the date of such acquisition, merger or consolidation;
(sq) receivables owing to Holdings or any Restricted Subsidiary, if created or acquired in the ordinary course of business;
(r) non-cash Investments in connection with tax planning and reorganization activities; provided that that, in the reasonable judgment of the Administrative Agent (following consultation with the Borrower), after giving effect to any such activities, the security interests of the Lenders in the Collateral, taken as a whole, would not be materially impaired;; and
(ts) Investments consisting of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference to this Section 6.04(t)) under Sections 6.01, 6.02, 6.03, 6.05 and 6.08, respectively;
(u) additional Investments; provided that after giving effect to such Investment (A) on a Pro Forma Basisfor utilities, security deposits, leases and similar prepaid expenses incurred in the Total Net Leverage Ratio is less than or equal to 4.50 to 1.00 ordinary course of business and (B) there is no continuing Event of Default;
(v) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the Borrower;
(w) to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Propertytrade accounts created, or other rightsprepaid expenses accrued, in each case in the ordinary course of business;
(x) Investments by an Unrestricted Subsidiary entered into prior to the day such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to the definition of “Unrestricted Subsidiary”;
(y) Investments consisting of purchases of assets of Franchisees (including, but not limited to, area development contracts owned by Franchisees) in the ordinary course of business or otherwise in an amount not exceeding $60,000,000, so long as (A) no Event of Default shall have occurred and be continuing and (B) the Borrower is in pro forma compliance with the Financial Covenant after giving effect to any such purchase;
(z) So long as no Event of Default shall have occurred and be continuing, Investments in Franchisees (including, but not limited to, (i) Guarantees or other credit support of any Indebtedness and other liabilities thereof and (ii) loans, advances or contributions to the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater of $20,000,000 and 70% of Consolidated EBITDA;
(aa) Investments consisting of accounts and payment intangibles owing to the Borrower or any of the Restricted Subsidiaries from Franchisees; provided that such obligation shall be on such terms as the Borrower or the applicable Restricted Subsidiary establishes in good faith; and
(bb) Investments consisting of advances or expenditures by any Loan Party to, or on behalf of, any CMF Subsidiary in support of advertising and marketing programs in the ordinary course consistent with current practices. For purposes of determining compliance with this Section 6.04, in the event that any item of Investment meets the criteria of more than one of the categories of Investments described in clauses (a) through (bb) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such Investment (or any portion thereof) and will only be required to include the amount and type of such Investment in one or more of the above clauses.
Appears in 1 contract
Samples: Credit Agreement (Tornier N.V.)
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor the The Borrower willwill not, nor will they it permit any Restricted Subsidiary or Intermediate Parent to, purchase or acquire (including pursuant to any merger with any Person that was not a wholly owned Subsidiary prior to such merger) any Equity Interests in or evidences of indebtedness or other securities (including any option, warrant or other right to acquire any of the foregoing) of, make any loans or hold advances to, Guarantee any Investmentobligations of, or make any investment or any other interest in, any other Person, or purchase or otherwise acquire (in one transaction or a series of transactions) any Person or assets or division constituting a business unit (collectively, “Investments”), except:
(ai) Permitted Investments at the time such Permitted Investment is madeAcquisitions;
(bii) loans or advances to officers, directors and employees of Holdings, any Intermediate Parent, Permitted Investments;
(iii) Investments set forth on Schedule 6.04;
(iv) Investments by the Borrower and the Restricted Subsidiaries in Equity Interests in Qualified Restricted Subsidiaries (other than an Insurance Subsidiary);
(v) loans or advances made by the Borrower to any Qualified Restricted Subsidiary (other than an Insurance Subsidiary) and made by any Restricted Subsidiary to the Borrower or any Qualified Restricted Subsidiary (other than an Insurance Subsidiary), provided that any such loans and advances made by a Loan Party shall be evidenced by a promissory note pledged pursuant to the Collateral Agreement;
(vi) Guarantees (other than of Indebtedness of an Insurance Subsidiary) constituting Indebtedness permitted by Section 6.01; provided that if at the time of and after giving effect to any Guarantee (and without limiting the foregoing) the aggregate principal amount of Indebtedness of Restricted Subsidiaries that are not Qualified Restricted Subsidiaries that is Guaranteed by the Borrower or any Qualified Restricted Subsidiary (together with the amount of Investments permitted under Section 5.15(a)(v) and Section 6.04(xvi)) exceeds 15.0% of Total Assets (in each case determined without regard to any write-downs or write-offs) on a pro forma basis such Guarantee shall not be permitted and that any such Guarantees shall only be permitted so long as no Default has occurred and is continuing or would result therefrom on a Pro Forma Basis; provided further that (i) substantially all of the business activities of any such Restricted Subsidiary that is not a Qualified Restricted Subsidiary whose Indebtedness is so Guaranteed consists of owning or operating surgical facilities and (ii) a majority of the voting stock of such Person is owned by the Borrower, its Restricted Subsidiaries and/or other Persons that are not Affiliates of the Borrower;
(vii) receivables or other trade payables owing to the Borrower or any Restricted Subsidiary if created or acquired in the ordinary course of business consistent with past practice and payable or dischargeable in accordance with customary trade terms, provided that such trade terms may include such concessionary trade terms as the Borrower or any such Restricted Subsidiary deems reasonable under the circumstances;
(viii) Investments consisting of Equity Interests, obligations, securities or other property received in settlement of delinquent accounts of and disputes with customers and suppliers in the ordinary course of business and owing to the Borrower or any Restricted Subsidiary or in satisfaction of judgments;
(ix) Investments by the Borrower or any Restricted Subsidiary in payroll, travel and similar advances to cover matters that are expected at the time of such advances ultimately to be treated as expenses for accounting purposes and that are made in the ordinary course of business;
(x) loans or advances by the Borrower or any Restricted Subsidiary to employees (a) made for reasonable and customary business-related travel, entertainment, relocation and analogous ordinary business purposes, purposes and (iib) otherwise not exceeding $2,500,000 in the aggregate at any time outstanding (determined without regard to any write-downs or write-offs of such loans or advances);
(xi) Investments in the form of Swap Agreements permitted by Section 6.07;
(xii) Investments of any Person existing at the time such Person becomes a Restricted Subsidiary of the Borrower or consolidates or merges with the Borrower or any of the Restricted Subsidiaries (including in connection with a Permitted Acquisition) so long as such Person’s purchase of Equity Interests investments were not made in Holdings (or any direct or indirect parent thereof) (provided that the amount contemplation of such loans and advances made Person becoming a Restricted Subsidiary or of such consolidation or merger;
(xiii) Investments received in cash to such Person shall be contributed to connection with the Borrower dispositions of assets permitted by Section 6.05;
(xiv) Investments constituting deposits described in cash as common equity or Qualified Equity Interestsclauses (c) and (iiid) for purposes not described in of the foregoing clauses (i) and (ii); provided that at definition of the time of incurrence thereof and after giving Pro Forma Effect thereto, the aggregate principal amount outstanding in reliance on this clause (iii) shall not exceed $1,000,000term “Permitted Encumbrances”;
(cxv) so long as no Default has occurred and is continuing or would result therefrom on a Pro Forma Basis, Investments by Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary in an aggregate amount, as valued at cost at the time each such Investment is made and including all related commitments for future advances, not exceeding the Available Amount immediately prior to the time of the making of any such Investment;
(xvi) so long as no Default has occurred and is continuing or would result therefrom on a Pro Forma Basis, Investments in joint ventures, Restricted Subsidiaries that are not Qualified Restricted Subsidiaries and Unrestricted Subsidiaries by the Borrower or any Qualified Restricted Subsidiary in an aggregate amount not to exceed at the time of Holdingssuch Investment on a pro forma basis, together with the amount of Investments permitted under Section 5.15(a)(v) and the proviso to Section 6.04(vi), 15.0% of Total Assets on a pro forma basis; provided that (i) substantially all of the business activities of any Intermediate Parentsuch joint venture, Restricted Subsidiary that is not a Qualified Restricted Subsidiary, or Unrestricted Subsidiary consists of owning or operating surgical facilities and (ii) a majority of the voting stock of such Person is owned by the Borrower, its Restricted Subsidiaries and/or other Persons that are not Affiliates of the Borrower;
(xvii) Guarantees by the Borrower or any Restricted Subsidiary; provided Subsidiary of leases (other than Capital Lease Obligations) or of other obligations that the aggregate outstanding amount of Investments made by Loan Parties do not constitute Indebtedness, in Restricted Subsidiaries that are not Loan Parties in reliance on this clause (c) shall not exceed the greater of $10,000,000 and 35% of Consolidated EBITDA;
(d) Investments consisting of prepayments to suppliers each case entered into in the ordinary course of business;
(exviii) Investments consisting of extensions of trade credit advances to Non-Consolidated Entities in the ordinary course of business, which when made are expected to be repaid within sixty days of such advance;
(fxix) Investments (i) existing or contemplated on the date hereof Investments, loans and set forth on Schedule 6.04(f) and any modification, replacement, renewal, reinvestment or extension thereof and (ii) Investments existing on the date hereof advances by Holdings, the Borrower or any Restricted Subsidiary to any Insurance Subsidiary in the Borrower or any Restricted Subsidiary and any modification, renewal or extension thereof; provided that the amount of the original Investment is not increased except by the terms of such Investment amounts equal to the extent as set forth on Schedule 6.04(f) or as otherwise permitted by this Section 6.04;
(g) Investments in Swap Agreements permitted under Section 6.01(a)(vi);
(h) promissory notes and other non-cash consideration received in connection with Dispositions permitted by Section 6.05;
(i) Permitted Acquisitions;
(j) the Transactions;
(k) Investments in capital required under the ordinary course of business consisting of endorsements for collection applicable laws or deposit and customary trade arrangements with customers consistent with past practices;
(l) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers and customers, from financially troubled account debtors or in settlement of delinquent obligations of, or other disputes with, customers and suppliers or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment;
(m) loans and advances to Holdings (or any direct or indirect parent thereof) or any Intermediate Parent in lieu of, and not in excess regulations of the amount of (after giving effect jurisdiction in which such Insurance Subsidiary is formed or determined by in dependent actuaries as prudent and necessary capital to any other loans, advances or Restricted Payments in respect thereof), Restricted Payments to the extent permitted to be made to Holdings (or operate such parent) or such Intermediate Parent in accordance with Section 6.08(a);
(n) additional Investments and other acquisitions; provided that at the time any such Investment or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition made in reliance on this clause (n), together with the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (n), shall not exceed the sum of (A) the greater of $18,000,000 and 60% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Investment or other acquisition, plus (B) so long as no Event of Default has occurred and is continuing, the Available Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of such Investment;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby;
(p) advances of payroll payments to employees in the ordinary course of business;
(q) Investments and other acquisitions to the extent that payment for such Investments is made with Qualified Equity Interests (excluding Cure Amounts) of Holdings (or any direct or indirect parent thereof or the IPO Entity); provided that (i) such amounts used pursuant to this clause (q) shall not increase the Available Amount Insurance Subsidiary and (ii) any amounts used for reasonable corporate overhead expenses of such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof or the IPO Entity) shall otherwise be permitted pursuant to this Section 6.04Insurance Subsidiary;
(rxx) St. Louis Investments of a Subsidiary acquired after the Effective Date or of a Person merged or consolidated with any Subsidiary in accordance with this Section and Section 6.03 after the Effective Date an aggregate principal amount not to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger or consolidation and were in existence on the date of such acquisition, merger or consolidation;exceed $100.0 million; and
(sxxi) non-cash sales of interests in joint ventures to Strategic Investors or contributions of the St. Louis Investments in connection to joint ventures with tax planning and reorganization activitiesStrategic Investors; provided that the Borrower is in compliance with the Financial Performance Covenant (such covenant to be applied even if no Revolving Loan or Swingline Loan and less than $7.5 million of LC Exposure is outstanding) on a Pro Forma Basis after giving effect to any such activities, the security interests of the Lenders in the Collateral, taken as a whole, would not be materially impaired;
(t) Investments consisting of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference to this Section 6.04(t)) under Sections 6.01, 6.02, 6.03, 6.05 and 6.08, respectively;
(u) additional Investments; provided that after giving effect to such Investment (A) on a Pro Forma Basis, the Total Net Leverage Ratio is less than sale or equal to 4.50 to 1.00 and (B) there is no continuing Event of Default;
(v) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the Borrower;
(w) to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Property, or other rights, in each case in the ordinary course of business;
(x) Investments by an Unrestricted Subsidiary entered into prior to the day such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to the definition of “Unrestricted Subsidiary”;
(y) Investments consisting of purchases of assets of Franchisees (including, but not limited to, area development contracts owned by Franchisees) in the ordinary course of business or otherwise in an amount not exceeding $60,000,000, so long as (A) no Event of Default shall have occurred and be continuing and (B) the Borrower is in pro forma compliance with the Financial Covenant after giving effect to any such purchase;
(z) So long as no Event of Default shall have occurred and be continuing, Investments in Franchisees (including, but not limited to, (i) Guarantees or other credit support of any Indebtedness and other liabilities thereof and (ii) loans, advances or contributions to the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater of $20,000,000 and 70% of Consolidated EBITDA;
(aa) Investments consisting of accounts and payment intangibles owing to the Borrower or any of the Restricted Subsidiaries from Franchisees; provided that such obligation shall be on such terms as the Borrower or the applicable Restricted Subsidiary establishes in good faith; and
(bb) Investments consisting of advances or expenditures by any Loan Party to, or on behalf of, any CMF Subsidiary in support of advertising and marketing programs in the ordinary course consistent with current practices. For purposes of determining compliance with this Section 6.04, in the event that any item of Investment meets the criteria of more than one of the categories of Investments described in clauses (a) through (bb) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such Investment (or any portion thereof) and will only be required to include the amount and type of such Investment in one or more of the above clausescontribution.
Appears in 1 contract
Samples: Credit Agreement (United Surgical Partners International Inc)
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor the Borrower willAlamosa Delaware will not, nor and will they not permit any of its Restricted Subsidiary or Intermediate Parent Subsidiaries to, make purchase, hold or hold acquire any Investment, except:
(a) Permitted Investments at the time such Permitted Investment is madeMerger Transactions;
(b) loans or advances to officers, directors and employees of Holdings, any Intermediate Parent, the Borrower and the Restricted Subsidiaries (i) for reasonable and customary business-related travel, entertainment, relocation and analogous ordinary business purposes, (ii) in connection with such Person’s purchase of Equity Interests in Holdings (or any direct or indirect parent thereof) (provided that the amount of such loans and advances made in cash to such Person shall be contributed to the Borrower in cash as common equity or Qualified Equity Interests) and (iii) for purposes not described in the foregoing clauses (i) and (ii); provided that at the time of incurrence thereof and after giving Pro Forma Effect thereto, the aggregate principal amount outstanding in reliance on this clause (iii) shall not exceed $1,000,000Permitted Investments;
(c) Investments by Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary in any of Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary; provided that the aggregate outstanding amount of Investments made by Loan Parties in Restricted Subsidiaries that are not Loan Parties in reliance on this clause (c) shall not exceed the greater of $10,000,000 and 35% of Consolidated EBITDA;
(d) Investments consisting of prepayments to suppliers in the ordinary course of business;
(e) Investments consisting of extensions of trade credit in the ordinary course of business;
(f) Investments (i) existing or contemplated on the date hereof and set forth on Schedule 6.04(f6.04;
(d) Investments by Alamosa Delaware and its Restricted Subsidiaries (other than any modification, replacement, renewal, reinvestment or extension thereof Special Purpose Subsidiary) in Equity Interests in their respective Restricted Subsidiaries; provided that (i) any such Equity Interests held by a Loan Party shall be pledged pursuant to the Pledge Agreement (subject to the limitations applicable to common stock of a Foreign Subsidiary referred to in Section 5.12) and (ii) the aggregate amount of Investments of Loan Partes in Restricted Subsidiaries that are not Loan Parties (including all such Investments existing on the date hereof Effective Date and any such Investments under clause (e) or (f) below) at any time outstanding shall not exceed the lesser of (x) $10,000,000 and (y) $50,000,000 minus the amount of all other Permitted Equity Proceeds Uses at such time;
(e) loans or advances made by HoldingsAlamosa Delaware to any Restricted Subsidiary and made by any Restricted Subsidiary to Alamosa Delaware or any other Restricted Subsidiary; provided that (i) any such loans and advances made by Alamosa Delaware, the Borrower or any Subsidiary Loan Party, to the extent evidenced by a promissory note, shall be pledged pursuant to the Pledge Agreement and (ii) the amount of such loans and advances made by Loan Parties to Restricted Subsidiary Subsidiaries that are not Loan Parties shall be subject to the limitation set forth in the Borrower or any Restricted Subsidiary and any modification, renewal or extension thereofclause (d) above;
(f) Guarantees constituting Indebtedness permitted by Section 6.01; provided that the aggregate principal amount of the original Investment Indebtedness of Restricted Subsidiaries that are not Loan Parties that is not increased except Guaranteed by the terms of such Investment any Loan Party shall be subject to the extent as limitation set forth on Schedule 6.04(fin clause (d) or as otherwise permitted by this Section 6.04above;
(g) Investments received in Swap Agreements permitted under Section 6.01(a)(vi)connection with the bankruptcy or reorganization of, or settlement of delinquent accounts and disputes with, customers and suppliers, in each case in the ordinary course of business;
(h) promissory notes and other non-cash consideration received in connection with Dispositions any asset sale to the extent permitted by Section 6.05;
(i) Permitted Acquisitions;
(j) the Transactions;
(k) Investments loans, advances or extensions of credit to employees, officers and directors made in the ordinary course of business consisting of endorsements for collection or deposit and customary trade arrangements with customers consistent with past practicesin an aggregate principal amount at any time outstanding not to exceed $1,000,000;
(lj) Investments (including debt obligations negotiable instruments held for collection and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers operating lease, utility and customersworkers' compensation, from financially troubled account debtors or in settlement of delinquent obligations of, or other disputes with, customers and suppliers or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment;
(m) loans and advances to Holdings (or any direct or indirect parent thereof) or any Intermediate Parent in lieu of, and not in excess of the amount of (after giving effect to any other loans, advances or Restricted Payments in respect thereof), Restricted Payments to the extent permitted to be made to Holdings (or such parent) or such Intermediate Parent in accordance with Section 6.08(a);
(n) additional Investments performance and other acquisitions; provided that at the time any such Investment or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition made in reliance on this clause (n), together with the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (n), shall not exceed the sum of (A) the greater of $18,000,000 and 60% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Investment or other acquisition, plus (B) so long as no Event of Default has occurred and is continuing, the Available Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of such Investment;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby;
(p) advances of payroll payments to employees similar deposits in the ordinary course of business;
(qk) Investments and other acquisitions to the extent that payment for such Investments is made with Qualified Equity Interests (excluding Cure Amounts) of Holdings (or any direct or indirect parent thereof or the IPO Entity); provided that (i) such amounts used pursuant to this clause (q) shall not increase the Available Amount and (ii) any amounts used for such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof or the IPO Entity) shall otherwise be in Hedging Agreements permitted pursuant to this by Section 6.04;
(r) Investments of a Subsidiary acquired after the Effective Date or of a Person merged or consolidated with any Subsidiary in accordance with this Section and Section 6.03 after the Effective Date to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger or consolidation and were in existence on the date of such acquisition, merger or consolidation;
(s) non-cash Investments in connection with tax planning and reorganization activities; provided that after giving effect to any such activities, the security interests of the Lenders in the Collateral, taken as a whole, would not be materially impaired;
(t) Investments consisting of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference to this Section 6.04(t)) under Sections 6.01, 6.02, 6.03, 6.05 and 6.08, respectively;
(u) additional Investments; provided that after giving effect to such Investment (A) on a Pro Forma Basis, the Total Net Leverage Ratio is less than or equal to 4.50 to 1.00 and (B) there is no continuing Event of Default;
(v) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the Borrower;
(w) to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Property, or other rights, in each case in the ordinary course of business;
(x) Investments by an Unrestricted Subsidiary entered into prior to the day such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to the definition of “Unrestricted Subsidiary”;
(y) Investments consisting of purchases of assets of Franchisees (including, but not limited to, area development contracts owned by Franchisees) in the ordinary course of business or otherwise in an amount not exceeding $60,000,000, so long as (A) no Event of Default shall have occurred and be continuing and (B) the Borrower is in pro forma compliance with the Financial Covenant after giving effect to any such purchase;
(z) So long as no Event of Default shall have occurred and be continuing, Investments in Franchisees (including, but not limited to, (i) Guarantees or other credit support of any Indebtedness and other liabilities thereof and (ii) loans, advances or contributions to the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater of $20,000,000 and 70% of Consolidated EBITDA;
(aa) Investments consisting of accounts and payment intangibles owing to the Borrower or any of the Restricted Subsidiaries from Franchisees; provided that such obligation shall be on such terms as the Borrower or the applicable Restricted Subsidiary establishes in good faith6.07; and
(bbl) other Investments consisting of advances or expenditures by in any Loan Party to, or on behalf of, Person (including any CMF Subsidiary Unrestricted Subsidiary) in support of advertising and marketing programs in the ordinary course consistent with current practices. For purposes of determining compliance with this Section 6.04, in the event that an aggregate amount at any item of Investment meets the criteria of more than one of the categories of Investments described in clauses (a) through (bb) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such Investment (or any portion thereof) and will only be required time outstanding not to include exceed $50,000,000 minus the amount and type of all other Permitted Equity Proceeds Uses at such Investment in one or more of the above clausestime.
Appears in 1 contract
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor the The Borrower willwill not, nor will they it permit any Restricted Subsidiary or Intermediate Parent to, purchase or acquire (including pursuant to any merger with any Person that was not a wholly owned Subsidiary prior to such merger) any Equity Interests in or evidences of indebtedness or other securities (including any option, warrant or other right to acquire any of the foregoing) of, make any loans or hold advances to, Guarantee any Investmentobligations of, or make any investment or any other interest in, any other Person, or purchase or otherwise acquire (in one transaction or a series of transactions) any Person or assets or division constituting a business unit (collectively, “Investments”), except:
(ai) Permitted Investments at the time such Permitted Investment is madeAcquisitions;
(bii) loans or advances to officers, directors and employees of Holdings, any Intermediate Parent, Permitted Investments;
(iii) Investments set forth on Schedule 6.04;
(iv) Investments by the Borrower and the Restricted Subsidiaries in Equity Interests in Qualified Restricted Subsidiaries (other than an Insurance Subsidiary);
(v) loans or advances made by the Borrower to any Qualified Restricted Subsidiary (other than an Insurance Subsidiary) and made by any Restricted Subsidiary to the Borrower or any Qualified Restricted Subsidiary (other than an Insurance Subsidiary), provided that any such loans and advances made by a Loan Party shall be evidenced by a promissory note pledged pursuant to the Collateral Agreement;
(vi) Guarantees (other than of Indebtedness of an Insurance Subsidiary) constituting Indebtedness permitted by Section 6.01; provided that if at the time of and after giving effect to any Guarantee (and without limiting the foregoing) the aggregate principal amount of Indebtedness of Restricted Subsidiaries that are not Qualified Restricted Subsidiaries that is Guaranteed by the Borrower or any Qualified Restricted Subsidiary (together with the amount of Investments permitted under Section 5.15(a)(v) and Section 6.04(xvi)) exceeds 15.0% of Total Assets (in each case determined without regard to any write-downs or write-offs) on a pro forma basis such Guarantee shall not be permitted and that any such Guarantees shall only be permitted so long as no Default has occurred and is continuing or would result therefrom on a Pro Forma Basis; provided further that (i) substantially all of the business activities of any such Restricted Subsidiary that is not a Qualified Restricted Subsidiary whose Indebtedness is so Guaranteed consists of owning or operating surgical facilities and (ii) a majority of the voting stock of such Person is owned by the Borrower, its Restricted Subsidiaries and/or other Persons that are not Affiliates of the Borrower;
(vii) receivables or other trade payables owing to the Borrower or any Restricted Subsidiary if created or acquired in the ordinary course of business consistent with past practice and payable or dischargeable in accordance with customary trade terms, provided that such trade terms may include such concessionary trade terms as the Borrower or any such Restricted Subsidiary deems reasonable under the circumstances;
(viii) Investments consisting of Equity Interests, obligations, securities or other property received in settlement of delinquent accounts of and disputes with customers and suppliers in the ordinary course of business and owing to the Borrower or any Restricted Subsidiary or in satisfaction of judgments;
(ix) Investments by the Borrower or any Restricted Subsidiary in payroll, travel and similar advances to cover matters that are expected at the time of such advances ultimately to be treated as expenses for accounting purposes and that are made in the ordinary course of business;
(x) loans or advances by the Borrower or any Restricted Subsidiary to employees (a) made for reasonable and customary business-related travel, entertainment, relocation and analogous ordinary business purposes, purposes and (iib) otherwise not exceeding $2,500,000 in the aggregate at any time outstanding (determined without regard to any write-downs or write-offs of such loans or advances);
(xi) Investments in the form of Swap Agreements permitted by Section 6.07;
(xii) Investments of any Person existing at the time such Person becomes a Restricted Subsidiary of the Borrower or consolidates or merges with the Borrower or any of the Restricted Subsidiaries (including in connection with a Permitted Acquisition) so long as such Person’s purchase of Equity Interests investments were not made in Holdings (or any direct or indirect parent thereof) (provided that the amount contemplation of such loans and advances made Person becoming a Restricted Subsidiary or of such consolidation or merger;
(xiii) Investments received in cash to such Person shall be contributed to connection with the Borrower dispositions of assets permitted by Section 6.05;
(xiv) Investments constituting deposits described in cash as common equity or Qualified Equity Interestsclauses (c) and (iiid) for purposes not described in of the foregoing clauses (i) and (ii); provided that at definition of the time of incurrence thereof and after giving Pro Forma Effect thereto, the aggregate principal amount outstanding in reliance on this clause (iii) shall not exceed $1,000,000term “Permitted Encumbrances”;
(cxv) so long as no Default has occurred and is continuing or would result therefrom on a Pro Forma Basis, Investments by Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary in an aggregate amount, as valued at cost at the time each such Investment is made and including all related commitments for future advances, not exceeding the Available Amount immediately prior to the time of the making of any such Investment;
(xvi) so long as no Default has occurred and is continuing or would result therefrom on a Pro Forma Basis, Investments in joint ventures, Restricted Subsidiaries that are not Qualified Restricted Subsidiaries and Unrestricted Subsidiaries by the Borrower or any Qualified Restricted Subsidiary in an aggregate amount not to exceed at the time of Holdingssuch Investment on a pro forma basis, together with the amount of Investments permitted under Section 5.15(a)(v) and the proviso to Section 6.04(vi), 15.0% of Total Assets on a pro forma basis; provided that (i) substantially all of the business activities of any Intermediate Parentsuch joint venture, Restricted Subsidiary that is not a Qualified Restricted Subsidiary, or Unrestricted Subsidiary consists of owning or operating surgical facilities and (ii) a majority of the voting stock of such Person is owned by the Borrower, its Restricted Subsidiaries and/or other Persons that are not Affiliates of the Borrower;
(xvii) Guarantees by the Borrower or any Restricted Subsidiary; provided Subsidiary of leases (other than Capital Lease Obligations) or of other obligations that the aggregate outstanding amount of Investments made by Loan Parties do not constitute Indebtedness, in Restricted Subsidiaries that are not Loan Parties in reliance on this clause (c) shall not exceed the greater of $10,000,000 and 35% of Consolidated EBITDA;
(d) Investments consisting of prepayments to suppliers each case entered into in the ordinary course of business;
(exviii) Investments consisting of extensions of trade credit advances to Non-Consolidated Entities in the ordinary course of business, which when made are expected to be repaid within sixty days of such advance;
(fxix) Investments (i) existing or contemplated on the date hereof Investments, loans and set forth on Schedule 6.04(f) and any modification, replacement, renewal, reinvestment or extension thereof and (ii) Investments existing on the date hereof advances by Holdings, the Borrower or any Restricted Subsidiary to any Insurance Subsidiary in the Borrower or any Restricted Subsidiary and any modification, renewal or extension thereof; provided that the amount of the original Investment is not increased except by the terms of such Investment amounts equal to the extent as set forth on Schedule 6.04(f) or as otherwise permitted by this Section 6.04;
(g) Investments in Swap Agreements permitted under Section 6.01(a)(vi);
(h) promissory notes and other non-cash consideration received in connection with Dispositions permitted by Section 6.05;
(i) Permitted Acquisitions;
(j) the Transactions;
(k) Investments in capital required under the ordinary course of business consisting of endorsements for collection applicable laws or deposit and customary trade arrangements with customers consistent with past practices;
(l) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers and customers, from financially troubled account debtors or in settlement of delinquent obligations of, or other disputes with, customers and suppliers or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment;
(m) loans and advances to Holdings (or any direct or indirect parent thereof) or any Intermediate Parent in lieu of, and not in excess regulations of the amount of (after giving effect jurisdiction in which such Insurance Subsidiary is formed or determined by independent actuaries as prudent and necessary capital to any other loans, advances or Restricted Payments in respect thereof), Restricted Payments to the extent permitted to be made to Holdings (or operate such parent) or such Intermediate Parent in accordance with Section 6.08(a);
(n) additional Investments and other acquisitions; provided that at the time any such Investment or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition made in reliance on this clause (n), together with the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (n), shall not exceed the sum of (A) the greater of $18,000,000 and 60% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Investment or other acquisition, plus (B) so long as no Event of Default has occurred and is continuing, the Available Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of such Investment;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby;
(p) advances of payroll payments to employees in the ordinary course of business;
(q) Investments and other acquisitions to the extent that payment for such Investments is made with Qualified Equity Interests (excluding Cure Amounts) of Holdings (or any direct or indirect parent thereof or the IPO Entity); provided that (i) such amounts used pursuant to this clause (q) shall not increase the Available Amount Insurance Subsidiary and (ii) any amounts used for reasonable corporate overhead expenses of such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof or the IPO Entity) shall otherwise be permitted pursuant to this Section 6.04Insurance Subsidiary;
(rxx) St. Louis Investments of a Subsidiary acquired after the Effective Date or of a Person merged or consolidated with any Subsidiary in accordance with this Section and Section 6.03 after the Effective Date an aggregate principal amount not to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger or consolidation and were in existence on the date of such acquisition, merger or consolidation;exceed $100.0 million; and
(sxxi) non-cash sales of interests in joint ventures to Strategic Investors or contributions of the St. Louis Investments in connection to joint ventures with tax planning and reorganization activitiesStrategic Investors; provided that the Borrower is in compliance with the Financial Performance Covenant (such covenant to be applied even if no Revolving Loan or Swingline Loan and less than $7.5 million of LC Exposure is outstanding) on a Pro Forma Basis after giving effect to any such activities, the security interests of the Lenders in the Collateral, taken as a whole, would not be materially impaired;
(t) Investments consisting of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference to this Section 6.04(t)) under Sections 6.01, 6.02, 6.03, 6.05 and 6.08, respectively;
(u) additional Investments; provided that after giving effect to such Investment (A) on a Pro Forma Basis, the Total Net Leverage Ratio is less than sale or equal to 4.50 to 1.00 and (B) there is no continuing Event of Default;
(v) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the Borrower;
(w) to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Property, or other rights, in each case in the ordinary course of business;
(x) Investments by an Unrestricted Subsidiary entered into prior to the day such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to the definition of “Unrestricted Subsidiary”;
(y) Investments consisting of purchases of assets of Franchisees (including, but not limited to, area development contracts owned by Franchisees) in the ordinary course of business or otherwise in an amount not exceeding $60,000,000, so long as (A) no Event of Default shall have occurred and be continuing and (B) the Borrower is in pro forma compliance with the Financial Covenant after giving effect to any such purchase;
(z) So long as no Event of Default shall have occurred and be continuing, Investments in Franchisees (including, but not limited to, (i) Guarantees or other credit support of any Indebtedness and other liabilities thereof and (ii) loans, advances or contributions to the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater of $20,000,000 and 70% of Consolidated EBITDA;
(aa) Investments consisting of accounts and payment intangibles owing to the Borrower or any of the Restricted Subsidiaries from Franchisees; provided that such obligation shall be on such terms as the Borrower or the applicable Restricted Subsidiary establishes in good faith; and
(bb) Investments consisting of advances or expenditures by any Loan Party to, or on behalf of, any CMF Subsidiary in support of advertising and marketing programs in the ordinary course consistent with current practices. For purposes of determining compliance with this Section 6.04, in the event that any item of Investment meets the criteria of more than one of the categories of Investments described in clauses (a) through (bb) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such Investment (or any portion thereof) and will only be required to include the amount and type of such Investment in one or more of the above clausescontribution.
Appears in 1 contract
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor None of Holdings, the Borrower willor any Subsidiary will purchase, nor will they permit hold, acquire (including pursuant to any Restricted merger or consolidation with any Person that was not a wholly-owned Subsidiary or Intermediate Parent toprior thereto), make or hold otherwise permit to exist any Investment, except:
(a) Permitted Investments at the time such Permitted Investment is madeInvestments;
(b) loans or advances to officersInvestments existing on the date hereof in Subsidiaries, directors and employees of Holdings, other Investments existing on the date hereof and set forth on Schedule 6.04 (but not any Intermediate Parent, additions thereto (including any capital contributions) made after the Borrower and the Restricted Subsidiaries (i) for reasonable and customary business-related travel, entertainment, relocation and analogous ordinary business purposes, (ii) in connection with such Person’s purchase of Equity Interests in Holdings (or any direct or indirect parent thereof) (provided that the amount of such loans and advances made in cash to such Person shall be contributed to the Borrower in cash as common equity or Qualified Equity Interests) and (iii) for purposes not described in the foregoing clauses (i) and (iidate hereof); provided that at the time of incurrence thereof and after giving Pro Forma Effect thereto, the aggregate principal amount outstanding in reliance on this clause (iii) shall not exceed $1,000,000;
(c) Investments by Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary and the Subsidiaries in any of Holdings, any Intermediate Parent, the Borrower or any Restricted SubsidiaryEquity Interests in their subsidiaries; provided that (i) such subsidiaries are Subsidiaries prior to such investments, (ii) any such Equity Interests held by a Loan Party shall be pledged in accordance with the requirements of the definition of the term “Collateral and Guarantee Requirement” and (iii) the aggregate outstanding amount of such Investments made by Loan Parties in Restricted in, and loans and advances by Loan Parties to, and Guarantees by Loan Parties of Indebtedness and other obligations of, Subsidiaries that are not Loan Parties in reliance (excluding all such investments, loans, advances and Guarantees existing on this the date hereof and permitted by clause (cb) above) at any time outstanding shall not exceed an amount equal to (A) the greater CNTA Basket Amount minus (B) the aggregate amount of $10,000,000 and 35% all other CNTA Expenditures outstanding, in each case as of Consolidated EBITDAthe date on which any such Investment, loan, advance or Guarantee is made;
(d) Investments consisting of prepayments to suppliers in the ordinary course of business;
(e) Investments consisting of extensions of trade credit in the ordinary course of business;
(f) Investments (i) existing loans or contemplated on the date hereof and set forth on Schedule 6.04(f) and any modification, replacement, renewal, reinvestment or extension thereof and (ii) Investments existing on the date hereof advances made by Holdings, the Borrower or any Restricted Subsidiary to any other Subsidiary; provided that (i) the Indebtedness resulting therefrom is permitted by clause (iii) of Section 6.01(a) and (ii) the amount of such loans and advances made by Loan Parties to Subsidiaries that are not Loan Parties shall be subject to the limitation set forth in clause (c) above;
(e) Guarantees by Holdings, the Borrower or any Restricted Subsidiary of Indebtedness or other obligations of Holdings, the Borrower or any Subsidiary (including any such Guarantees arising as a result of any such Person being a joint and several co-applicant with respect to any modification, renewal letter of credit or extension thereofletter of guaranty); provided that (i) a Subsidiary that has not Guaranteed the Secured Obligations pursuant to the Collateral Agreement shall not Guarantee any Indebtedness or other obligations of any Loan Party, (ii) the aggregate amount of the original Investment Indebtedness of Subsidiaries that are not Loan Parties that is not increased except Guaranteed by the terms of such Investment any Loan Party shall be subject to the extent as limitation set forth on Schedule 6.04(fin clause (c) or as otherwise permitted above and (iii) the aggregate amount of obligations of Subsidiaries that are not Loan Parties that do not constitute Indebtedness and are Guaranteed by this Section 6.04any Loan Party shall not exceed $50,000,000 at any time outstanding;
(gf) Investments in Swap Agreements permitted under Section 6.01(a)(vi);
(h) promissory notes and other non-cash consideration received in connection with Dispositions permitted by Section 6.05;
(i) Permitted Acquisitions;
(j) the Transactions;
(k) Investments in the ordinary course of business consisting of endorsements for collection or deposit and customary trade arrangements with customers consistent with past practices;
(l) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers and customersof, from financially troubled account debtors or in settlement of delinquent obligations of, or other accounts and disputes with, customers and suppliers or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment;
(m) loans and advances to Holdings (or any direct or indirect parent thereof) or any Intermediate Parent in lieu of, and not in excess of the amount of (after giving effect to any other loans, advances or Restricted Payments in respect thereof), Restricted Payments to the extent permitted to be made to Holdings (or such parent) or such Intermediate Parent in accordance with Section 6.08(a);
(n) additional Investments and other acquisitions; provided that at the time any such Investment or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition made in reliance on this clause (n), together with the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (n), shall not exceed the sum of (A) the greater of $18,000,000 and 60% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Investment or other acquisition, plus (B) so long as no Event of Default has occurred and is continuing, the Available Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of such Investment;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby;
(p) advances of payroll payments to employees in the ordinary course of business;
(q) Investments and other acquisitions to the extent that payment for such Investments is made with Qualified Equity Interests (excluding Cure Amounts) of Holdings (or any direct or indirect parent thereof or the IPO Entity); provided that (i) such amounts used pursuant to this clause (q) shall not increase the Available Amount and (ii) any amounts used for such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof or the IPO Entity) shall otherwise be permitted pursuant to this Section 6.04;
(r) Investments of a Subsidiary acquired after the Effective Date or of a Person merged or consolidated with any Subsidiary in accordance with this Section and Section 6.03 after the Effective Date to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger or consolidation and were in existence on the date of such acquisition, merger or consolidation;
(s) non-cash Investments in connection with tax planning and reorganization activities; provided that after giving effect to any such activities, the security interests of the Lenders in the Collateral, taken as a whole, would not be materially impaired;
(t) Investments consisting of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference to this Section 6.04(t)) under Sections 6.01, 6.02, 6.03, 6.05 and 6.08, respectively;
(u) additional Investments; provided that after giving effect to such Investment (A) on a Pro Forma Basis, the Total Net Leverage Ratio is less than or equal to 4.50 to 1.00 and (B) there is no continuing Event of Default;
(v) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the Borrower;
(w) to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Property, or other rightssuppliers, in each case in the ordinary course of business;
(xg) Investments by an Unrestricted Subsidiary entered into prior to the day such Unrestricted Subsidiary is redesignated made as a Restricted Subsidiary pursuant to result of the definition receipt of “Unrestricted Subsidiary”;
(y) Investments consisting noncash consideration from a sale, transfer, lease or other disposition of purchases of assets of Franchisees (including, but not limited to, area development contracts owned by Franchisees) any asset in the ordinary course of business or otherwise in an amount not exceeding $60,000,000, so long as (A) no Event of Default shall have occurred and be continuing and (B) the Borrower is in pro forma compliance with the Financial Covenant after giving effect to any such purchaseSection 6.05;
(z) So long as no Event of Default shall have occurred and be continuing, Investments in Franchisees (including, but not limited to, (i) Guarantees or other credit support of any Indebtedness and other liabilities thereof and (ii) loans, advances or contributions to the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater of $20,000,000 and 70% of Consolidated EBITDA;
(aa) Investments consisting of accounts and payment intangibles owing to the Borrower or any of the Restricted Subsidiaries from Franchisees; provided that such obligation shall be on such terms as the Borrower or the applicable Restricted Subsidiary establishes in good faith; and
(bb) Investments consisting of advances or expenditures by any Loan Party to, or on behalf of, any CMF Subsidiary in support of advertising and marketing programs in the ordinary course consistent with current practices. For purposes of determining compliance with this Section 6.04, in the event that any item of Investment meets the criteria of more than one of the categories of Investments described in clauses (a) through (bb) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such Investment (or any portion thereof) and will only be required to include the amount and type of such Investment in one or more of the above clauses.
Appears in 1 contract
Samples: Credit Agreement (Fairchild Semiconductor International Inc)
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor the Borrower will, nor will they permit any Restricted Subsidiary or Intermediate Parent to, make or hold any Investment, except:
(a) Permitted Investments at the time such Permitted Investment is madeInvestments;
(b) loans or advances to officers, directors and employees of Holdings, any Intermediate Parent, the Borrower and the its Restricted Subsidiaries (i) for reasonable and customary business-related travel, entertainment, relocation and analogous ordinary business purposes, (ii) in connection with such Person’s purchase of Equity Interests in of Holdings (or any direct or indirect parent thereofthereof or any Employee Holding Vehicle) (provided that the amount of such loans and advances made in cash to such Person shall be contributed to the Borrower in cash as common equity or Qualified Equity Interests) and (iii) for purposes not described in the foregoing clauses (i) and (ii); provided that at the time of incurrence thereof and after giving Pro Forma Effect thereto, the in an aggregate principal amount outstanding at any time not to exceed $5,000,000;
(c) Investments (i) by Holdings, the Borrower or any Restricted Subsidiary in any Loan Party (excluding any new Restricted Subsidiary that becomes a Loan Party pursuant to such Investment), (ii) by any Restricted Subsidiary that is not a Loan Party in any other Restricted Subsidiary that is also not a Loan Party, (iii) by Holdings or any Restricted Subsidiary (A) in any Restricted Subsidiary; provided that the aggregate amount of such Investments made by Loan Parties after the Restatement Effective Date in Restricted Subsidiaries that are not Loan Parties in reliance on this clause (iiiiii)(A) (including any such Investments deemed to be made pursuant to Section 6.14) (together with the amount of Investments made in Restricted Subsidiaries (other than Regulated Subsidiaries) that are not Loan Parties pursuant to Section 6.04(h) and the amount of Investments and acquisitions made pursuant to Section 6.04(m), in each case, after the Restatement Effective Date) shall not exceed $1,000,000;
the Non-Loan Party Investment Amount at the time of any such Investment, (cB) Investments in any Regulated Subsidiary in the form of short-term intercompany advances and Indebtedness, in each case made in the ordinary course of business to provide for working capital and other operational requirements of such Regulated Subsidiary, (C) in any Restricted Subsidiary that is not a Loan Party, constituting an exchange of Equity Interests of such Restricted Subsidiary for Indebtedness of such Subsidiary, (D) constituting Guarantees of Indebtedness or other monetary obligations of Restricted Subsidiaries that are not Loan Parties owing to any Loan Party or (E) constituting unsecured Guarantees of Trading Debt to the extent such Guarantees are permitted under Section 6.01(a)(iii), (iv) by Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary in any of Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary; provided that the aggregate outstanding amount of Investments made by Loan Parties in Restricted Subsidiaries that are not Loan Parties so long as such Investment is part of a series of simultaneous transactions that result in reliance on this clause the proceeds of the initial transaction being invested in one or more Loan Parties or, if the proceeds were initially held by a non-Loan Party, in a Restricted Subsidiary that is not a Loan Party and (cv) shall by Holdings, the Borrower or any Restricted Subsidiary in any Restricted Subsidiary that is not exceed a Loan Party, consisting of the greater contribution of $10,000,000 and 35% Equity Interests of Consolidated EBITDAany other Restricted Subsidiary that is not a Loan Party so long as the Equity Interests of the transferee Restricted Subsidiary is pledged to secure the Secured Obligations;
(d) Investments consisting of prepayments to suppliers in the ordinary course of business;
(e) Investments consisting of extensions of trade credit in the ordinary course of business;
(fe) Investments (i) existing or contemplated on the date hereof Restatement Effective Date and set forth on Schedule 6.04(f6.04(e) and any modification, replacement, renewal, reinvestment or extension thereof and (ii) Investments existing on the date hereof Restatement Effective Date by Holdings, the Borrower or any Restricted Subsidiary in the Borrower or any Restricted Subsidiary and any modification, renewal or extension thereof; provided that in each case the amount of the original Investment is not increased except by the terms of such Investment to the extent as set forth on Schedule 6.04(f6.04(e) or as otherwise permitted by this Section 6.04;
(gf) Investments in Swap Agreements permitted under Section 6.01(a)(vi)6.07;
(hg) promissory notes and other non-cash consideration received in connection with Dispositions permitted by Section 6.05;
(ih) Permitted Acquisitions; provided that the aggregate amount of consideration paid or provided by Holdings, any Intermediate Parent, the Borrower or any other Loan Party (including any Indebtedness incurred by any such Person to finance any portion of such consideration) after the Restatement Effective Date in reliance on this Section 6.04(h) (together with any Investments made in Subsidiaries that are not Loan Parties pursuant to Section 6.04(c)(iii)(A), Investments deemed to be made pursuant to Section 6.14 and the amount of Investments and acquisitions made pursuant to Section 6.04(m), in each case, after the Restatement Effective Date) for Permitted Acquisitions (including the aggregate principal amount of all Indebtedness assumed in connection with Permitted Acquisitions) of any Restricted Subsidiary (other than a Regulated Subsidiary) that shall not be or, after giving effect to such Permitted Acquisition, shall not become, a Loan Party, shall not exceed the Non-Loan Party Investment Amount at such time;
(i) prior to the Escrow Assumption Date, Investments in the Escrow Borrower to fund interest and other amounts owing or required to be pre-funded with respect to the Escrow Term Loans and, to the extent applicable, interest and other amounts owing or required to be pre-funded in respect of the Second Lien Notes;
(j) the Transactions;
(k) Investments in the ordinary course of business consisting of Uniform Commercial Code Article 3 endorsements for collection or deposit and Uniform Commercial Code Article 4 customary trade arrangements with customers consistent with past practices;
(lk) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers and customers, from financially troubled account debtors customers or in settlement of delinquent obligations of, or other disputes with, customers and suppliers or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment;
(ml) loans and advances to Holdings (or any direct or indirect parent thereof) or any Intermediate Parent in lieu of, and not in excess of the amount of (after giving effect to any other loans, advances or Restricted Payments in respect thereof), Restricted Payments to the extent permitted to be made to Holdings (or such parent) or such Intermediate Parent in accordance with Section 6.08(a6.08(a)(iv), (v), (vi), (vii) or (viii);
(nm) additional so long as immediately after giving effect to any such Investment or acquisition no Default shall have occurred and be continuing, other Investments and other acquisitions; provided that at the time any such Investment (including any such Investments deemed to be made pursuant to Section 6.14) or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition all Investments made in reliance on this clause (nm) (including all such Investments deemed made pursuant to Section 6.14), Investments made in Subsidiaries that are not Loan Parties pursuant to Section 6.04(c)(iii)(A) and Investments made in Restricted Subsidiaries (other than Regulated Subsidiaries) that are not Loan Parties pursuant to Section 6.04(h), together with the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (nm) (including the aggregate principal amount of all Indebtedness assumed in connection with any such other acquisition), in each case, after the Restatement Effective Date, shall not exceed the sum Non-Loan Party Investment Amount at the time of (A) the greater of $18,000,000 and 60% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of any such Investment or other acquisition, plus (B) so long as no Event of Default has occurred and is continuing, the Available Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of such Investment;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby;
(pn) advances of payroll payments to employees in the ordinary course of business;
(q) Investments and other acquisitions to the extent that payment for such Investments is made with Qualified Equity Interests (excluding Cure Amounts) of Holdings (or any direct or indirect parent thereof or the IPO Entity); provided that (i) such amounts used pursuant to this clause (q) shall not increase the Available Amount and (ii) any amounts used for such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof or the IPO Entity) shall otherwise be permitted pursuant to this Section 6.04;
(r) Investments of a Subsidiary acquired after the Effective Date or of a Person merged or consolidated with any Subsidiary in accordance with this Section and Section 6.03 after the Effective Date to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger or consolidation and were in existence on the date of such acquisition, merger or consolidation;
(s) non-cash Investments in connection with tax planning and reorganization activities; provided that after giving effect to any such activities, the security interests of the Lenders in the Collateral, taken as a whole, would not be materially impaired;
(t) Investments consisting of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference to this Section 6.04(t)) under Sections 6.01, 6.02, 6.03, 6.05 and 6.08, respectively;
(u) additional Investments; provided that after giving effect to such Investment (A) on a Pro Forma Basis, the Total Net Leverage Ratio is less than or equal to 4.50 to 1.00 and (B) there is no continuing Event of Default;
(v) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the Borrower;
(w) to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Property, or other rights, in each case in the ordinary course of business;
(x) Investments by an Unrestricted Subsidiary entered into prior to the day such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to the definition of “Unrestricted Subsidiary”;
(y) Investments consisting of purchases of assets of Franchisees (including, but not limited to, area development contracts owned by Franchisees) in the ordinary course of business or otherwise in an amount not exceeding $60,000,000, so long as (A) no Event of Default shall have occurred and be continuing and (B) the Borrower is in pro forma compliance with the Financial Covenant after giving effect to any such purchase;
(z) So long as no Event of Default shall have occurred and be continuing, Investments in Franchisees (including, but not limited to, (i) Guarantees or other credit support of any Indebtedness and other liabilities thereof and (ii) loans, advances or contributions to the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater of $20,000,000 and 70% of Consolidated EBITDA;
(aa) Investments consisting of accounts and payment intangibles owing to the Borrower or any of the Restricted Subsidiaries from Franchisees; provided that such obligation shall be on such terms as the Borrower or the applicable Restricted Subsidiary establishes in good faith; and
(bb) Investments consisting of advances or expenditures by any Loan Party to, or on behalf of, any CMF Subsidiary in support of advertising and marketing programs in the ordinary course consistent with current practices. For purposes of determining compliance with this Section 6.04, in the event that any item of Investment meets the criteria of more than one of the categories of Investments described in clauses (a) through (bb) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such Investment (or any portion thereof) and will only be required to include the amount and type of such Investment in one or more of the above clauses.
Appears in 1 contract
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor the The Borrower willwill not, nor and will they not permit any Restricted Subsidiary or Intermediate Parent to, make or hold any Investment, except:
: (a) Permitted Investments at the time such Permitted Investment is made;
; (b) loans or advances to officers, directors members of the Board of Directors, employees and employees consultants of Holdings, any Intermediate Parent, the Borrower and the its Restricted Subsidiaries (i) for reasonable and customary business-related travel, entertainment, relocation and analogous ordinary business purposes, (ii) in connection with such Person’s purchase of Equity Interests in Holdings (or any direct or indirect parent thereof) of the Borrower (provided that the amount of such loans and advances made in cash to such Person shall be contributed to the Borrower in cash as in exchange for common equity or other Qualified Equity Interests) and such amounts shall not increase the Available Amount and (iii) for purposes not described in the foregoing clauses (i) and (ii); provided that at the time of incurrence thereof and after giving Pro Forma Effect thereto, the in an aggregate principal amount outstanding in reliance on this clause (iii) shall at any time not to exceed $1,000,000;
2,500,000; (c) Investments by Holdings, the Borrower in any Intermediate Parent, Restricted Subsidiary and Investments by any Restricted Subsidiary in the Borrower or any Restricted Subsidiary in any of Holdings, any Intermediate Parent, the Borrower or any other Restricted Subsidiary; provided that, in the case of any Investment by a Loan Party in a Restricted Subsidiary that is not a Loan Party, the aggregate outstanding amount of all such Investments made by Loan Parties after the Closing Date in Restricted Subsidiaries that are not Loan Parties in reliance on this clause (c), together with (x) shall the aggregate cash consideration paid for Permitted Acquisitions of Persons that do not exceed the greater of $10,000,000 become Subsidiary Loan Parties (or are not merged with and 35% of Consolidated EBITDA;
(d) Investments consisting of prepayments to suppliers in the ordinary course of business;
(e) Investments consisting of extensions of trade credit in the ordinary course of business;
(f) Investments (i) existing or contemplated on the date hereof and set forth on Schedule 6.04(f) and any modification, replacement, renewal, reinvestment or extension thereof and (ii) Investments existing on the date hereof by Holdings, into the Borrower or any Restricted a Subsidiary in Loan Party) or of assets that are not owned by the Borrower or any Restricted a Subsidiary Loan Party after giving Pro Forma Effect to each such applicable Permitted Acquisition and any modification, renewal or extension thereof; provided that the amount of the original Investment is not increased except by the terms of such Investment to the extent as set forth transactions occurring in connection therewith in reliance on Schedule 6.04(f) or as otherwise permitted by this Section 6.04;
(g) Investments in Swap Agreements permitted under Section 6.01(a)(vi);
clause (h) promissory notes below and other non-cash consideration received in connection with Dispositions permitted by Section 6.05;
(iy) Permitted Acquisitions;
(j) the Transactions;
(k) Investments in the ordinary course of business consisting of endorsements for collection or deposit and customary trade arrangements with customers consistent with past practices;
(l) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers and customers, from financially troubled account debtors or in settlement of delinquent obligations of, or other disputes with, customers and suppliers or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment;
(m) loans and advances to Holdings (or any direct or indirect parent thereof) or any Intermediate Parent in lieu of, and not in excess of the amount of (after giving effect to any other loans, advances or Restricted Payments in respect thereof), Restricted Payments to the extent permitted to be made to Holdings (or such parent) or such Intermediate Parent in accordance with Section 6.08(a);
(n) additional Investments and other acquisitions; provided that at the time any such Investment or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition Investments made in reliance on this clause (n), together with the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (n)aa) below, shall not exceed the sum of (A) at any time outstanding the greater of $18,000,000 23,000,000 and 6025% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Investment or other acquisition, plus (B) so long as no Event of Default has occurred and is continuing, the Available Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of such Investment;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby;
(p) advances of payroll payments to employees in the ordinary course of business;
(q) Investments and other acquisitions to the extent that payment for such Investments is made with Qualified Equity Interests (excluding Cure Amounts) of Holdings (or any direct or indirect parent thereof or the IPO Entity); provided that (i) such amounts used pursuant to this clause (q) shall not increase the Available Amount and (ii) any amounts used for such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof or the IPO Entity) shall otherwise be permitted pursuant to this Section 6.04;
(r) Investments of a Subsidiary acquired after the Effective Date or of a Person merged or consolidated with any Subsidiary in accordance with this Section and Section 6.03 after the Effective Date to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger or consolidation and were in existence on the date of such acquisition, merger or consolidation;
(s) non-cash Investments in connection with tax planning and reorganization activities; provided that after giving effect to any such activities, the security interests of the Lenders in the Collateral, taken as a whole, would not be materially impaired;
(t) Investments consisting of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference to this Section 6.04(t)) under Sections 6.01, 6.02, 6.03, 6.05 and 6.08, respectively;
(u) additional Investments; provided that after giving effect to such Investment (A) on a Pro Forma Basis, the Total Net Leverage Ratio is less than or equal to 4.50 to 1.00 and (B) there is no continuing Event of Default;
(v) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the Borrower;
(w) to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Property, or other rights, in each case in the ordinary course of business;
(x) Investments by an Unrestricted Subsidiary entered into prior to the day such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to the definition of “Unrestricted Subsidiary”;
(y) Investments consisting of purchases of assets of Franchisees (including, but not limited to, area development contracts owned by Franchisees) in the ordinary course of business or otherwise in an amount not exceeding $60,000,000, so long as (A) no Event of Default shall have occurred and be continuing and (B) the Borrower is in pro forma compliance with the Financial Covenant after giving effect to any such purchase;
(z) So long as no Event of Default shall have occurred and be continuing, Investments in Franchisees (including, but not limited to, (i) Guarantees or other credit support of any Indebtedness and other liabilities thereof and (ii) loans, advances or contributions to the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater of $20,000,000 and 70% of Consolidated EBITDA;
(aa) Investments consisting of accounts and payment intangibles owing to the Borrower or any of the Restricted Subsidiaries from Franchisees; provided that such obligation shall be on such terms as the Borrower or the applicable Restricted Subsidiary establishes in good faith; and
(bb) Investments consisting of advances or expenditures by any Loan Party to, or on behalf of, any CMF Subsidiary in support of advertising and marketing programs in the ordinary course consistent with current practices. For purposes of determining compliance with this Section 6.04, in the event that any item of Investment meets the criteria of more than one of the categories of Investments described in clauses (a) through (bb) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such Investment (or any portion thereof) and will only be required to include the amount and type of such Investment in one or more of the above clauses.
Appears in 1 contract
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor the Borrower will, nor will they permit any Restricted Subsidiary or Intermediate Parent to, make or hold any Investment, except:
(a) Permitted Investments at the time such Permitted Investment is made;
(b) loans or advances to officers, directors and employees of Holdings, any Intermediate Parent, the Borrower and the Restricted Subsidiaries (i) for reasonable and customary business-related travel, entertainment, relocation and analogous ordinary business purposes, (ii) in connection with such Person’s purchase of Equity Interests in Holdings (or any direct or indirect parent thereof) (provided that the amount of such loans and advances made in cash to such Person shall be contributed to the Borrower in cash as common equity or Qualified Equity Interests) and (iii) for purposes not described in the foregoing clauses (i) and (ii); provided that at the time of incurrence thereof and after giving Pro Forma Effect thereto, the aggregate principal amount outstanding in reliance on this clause (iii) shall not exceed $1,000,000;
(c) Investments by Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary in any of Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary; provided that the aggregate outstanding amount of Investments made by Loan Parties in Restricted Subsidiaries that are not Loan Parties in reliance on this clause (c) shall not exceed the greater of $10,000,000 and 35% of Consolidated EBITDA;
(d) Investments consisting of prepayments to suppliers in the ordinary course of business;
(e) Investments consisting of extensions of trade credit in the ordinary course of business;
(f) Investments (i) existing or contemplated on the date hereof and set forth on Schedule 6.04(f) and any modification, replacement, renewal, reinvestment or extension thereof and (ii) Investments existing on the date hereof by Holdings, the Borrower or any Restricted Subsidiary in the Borrower or any Restricted Subsidiary and any modification, renewal or extension thereof; provided that the amount of the original Investment is not increased except by the terms of such Investment to the extent as set forth on Schedule 6.04(f) or as otherwise permitted by this Section 6.04;
(g) Investments in Swap Agreements permitted under Section 6.01(a)(vi);
(h) promissory notes and other non-cash consideration received in connection with Dispositions permitted by Section 6.05;
(i) Permitted Acquisitions;
(j) the Transactions;
(k) Investments in the ordinary course of business consisting of endorsements for collection or deposit and customary trade arrangements with customers consistent with past practices;
(l) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers and customers, from financially troubled account debtors or in settlement of delinquent obligations of, or other disputes with, customers and suppliers or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment;
(m) loans and advances to Holdings (or any direct or indirect parent thereof) or any Intermediate Parent in lieu of, and not in excess of the amount of (after giving effect to any other loans, advances or Restricted Payments in respect thereof), Restricted Payments to the extent permitted to be made to Holdings (or such parent) or such Intermediate Parent in accordance with Section 6.08(a);
(n) additional Investments and other acquisitions; provided that at the time any such Investment or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition made in reliance on this clause (n), together with the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (n), shall not exceed the sum of (A) the greater of $18,000,000 and 60% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Investment or other acquisition, plus (B) so long as no Event of Default has occurred and is continuing, the Available Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of such Investment;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby;
(p) advances of payroll payments to employees in the ordinary course of business;
(q) Investments and other acquisitions to the extent that payment for such Investments is made with Qualified Equity Interests (excluding Cure Amounts) of Holdings (or any direct or indirect parent thereof or the IPO Entity); provided that (i) such amounts used pursuant to this clause (q) shall not increase the Available Amount and (ii) any amounts used for such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof or the IPO Entity) shall otherwise be permitted pursuant to this Section 6.04;
(r) Investments of a Subsidiary acquired after the Effective Date or of a Person merged or consolidated with any Subsidiary in accordance with this Section and Section 6.03 after the Effective Date to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger or consolidation and were in existence on the date of such acquisition, merger or consolidation;
(s) non-cash Investments in connection with tax planning and reorganization activities; provided that after giving effect to any such activities, the security interests of the Lenders in the Collateral, taken as a whole, would not be materially impaired;
(t) Investments consisting of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference to this Section 6.04(t)) under Sections 6.01, 6.02, 6.03, 6.05 and 6.08, respectively;
(u) additional Investments; provided that after giving effect to such Investment (A) on a Pro Forma Basis, the Total Net Leverage Ratio is less than or equal to 4.50 to 1.00 and (B) there is no continuing Event of Default;
(v) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the Borrower;
(w) to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Property, or other rights, in each case in the ordinary course of business;
(x) Investments by an Unrestricted Subsidiary entered into prior to the day such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to the definition of “Unrestricted Subsidiary”;
(y) Investments consisting of purchases of assets of Franchisees (including, but not limited to, area development contracts owned by Franchisees) in the ordinary course of business or otherwise in an amount not exceeding $60,000,000, so long as (A) no Event of Default shall have occurred and be continuing and (B) the Borrower is in pro forma compliance with the applicable Financial Covenant after giving effect to any such purchase;
(z) So Soso long as no Event of Default shall have occurred and be continuing, Investments in Franchisees (including, but not limited to, (i) Guarantees or other credit support of any Indebtedness and other liabilities thereof (which shall not be permitted to be incurred during the Amendment No. 3 Trigger Period, except in an aggregate principal amount not exceeding $10,000,000 and solely to the extent such Guarantees or credit support are not provided with respect to any Franchisee rent obligations) and (ii) loans, advances or contributions to the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater of $20,000,000 and 70% of Consolidated EBITDA;
(aa) Investments consisting of accounts and payment intangibles owing to the Borrower or any of the Restricted Subsidiaries from Franchisees; provided that such obligation shall be on such terms as the Borrower or the applicable Restricted Subsidiary establishes in good faith; and
(bb) Investments consisting of advances or expenditures by any Loan Party to, or on behalf of, any CMF Subsidiary in support of advertising and marketing programs in the ordinary course consistent with current practices. For purposes .; and
(cc) so long as (A) no Default or Event of determining compliance Default shall have occurred and be continuing and (B) on a Pro Forma Basis, the Total Net Leverage Ratio is less than or equal to 5.25 to 1.00, additional Investments in an aggregate amount not to exceed, when taken together with this Restricted Payments made pursuant to Section 6.046.08(a)(ii), in the event that any item of Investment meets the criteria of more than one amount of the categories of Investments described in clauses (a) through (bb) aboveAmendment No. 3 Contribution and, Holdings shallto the extent funded, in its sole discretion, classify and reclassify or later divide, classify or reclassify such Investment (or any portion thereof) and will only be required to include the amount and type of such Investment in one or more of the above clauses.Amendment No. 3
Appears in 1 contract
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor the The Borrower willwill not, nor will they it permit any Restricted Subsidiary or Intermediate Parent to, make or hold any Investment, except:
(a) Permitted Investments at the time such Permitted Investment is made;
(b) loans or advances to present or former officers, directors directors, managers, members of management, consultants, independent contractors and employees of Holdings, any Intermediate Parent, the Borrower and the Restricted Subsidiaries (i) for reasonable and customary business-related travel, entertainment, relocation and analogous ordinary business purposes, purposes and (ii) in connection with such Person’s purchase of Equity Interests in Holdings (or any direct or indirect parent thereof) (provided that the amount of such loans and advances made in cash to such Person shall be contributed to the Borrower in cash as common equity or Qualified Equity Interests) and (iii) for purposes not described in the foregoing clauses clause (i) and (ii); provided that at the time of incurrence thereof and after giving Pro Forma Effect pro forma effect thereto, the aggregate principal amount outstanding in reliance on this clause these clauses (iiii) and (ii) shall not exceed $1,000,000;
(c) Investments (i) by Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary in any Loan Party; provided that to the extent the aggregate amount of HoldingsInvestments by a Restricted Subsidiary that is not a Loan Party in a Loan Party exceeds $1,000,000, such non-Loan Party Restricted Subsidiary shall have acceded to the Junior Intercreditor Agreement pursuant to the terms thereof; (ii) by any Intermediate ParentRestricted Subsidiary that is not a Loan Party in any other Restricted Subsidiary that is also not a Loan Party, (iii) subject to the proviso in clause (c)(i) of this Section 6.04, by the Borrower or any Restricted Subsidiary (A) in any Restricted Subsidiary; provided that (x) the aggregate outstanding amount of such Investments made by Loan Parties after the Effective Date in Restricted Subsidiaries that are not Loan Parties in reliance on this clause (iii)(A), together with the aggregate amount of (x) all other Investments made in and Dispositions made to Restricted Subsidiaries that are not Loan Parties by any Loan Parties after the Effective Date and (y) all Investments and Dispositions made in reliance on Section 6.16(ii), shall not exceed, at the time of the making thereof and after giving pro forma effect thereto, $2,500,000, (y) no Event of Default has occurred and is continuing and (z) all Investments made by Loan Parties in Restricted Subsidiaries that are not Loan Parties in reliance on this clause (ciii)(A) shall be made only for the purpose of financing working capital needs of such non Loan Parties or another purpose agreed to by the Required Lenders (in their sole discretion) and shall be evidenced by an intercompany note that has been pledged as Collateral, (B) [reserved] or (C) constituting Guarantees of Indebtedness or other monetary obligations of Restricted Subsidiaries that are not exceed Loan Parties owing to any Loan Party, (iv) by the greater Borrower or any Restricted Subsidiary in Restricted Subsidiaries that are not Loan Parties so long as such transaction is part of $10,000,000 and 35% a series of Consolidated EBITDAsimultaneous transactions that results in the proceeds of the initial Investment being invested in one or more Loan Parties, (v) subject to the consent of the Required Lenders (in their sole discretion), by the Borrower or any Restricted Subsidiary in any Restricted Subsidiary that is not a Loan Party, consisting of the contribution of Equity Interests of any other Restricted Subsidiary that is not a Loan Party so long as the Equity Interests of the transferee Restricted Subsidiary is pledged to secure the Secured Obligations;
(d) Investments consisting of deposits, prepayments and/or other credits to suppliers in the ordinary course of business;
(e) Investments consisting of extensions of trade credit in the ordinary course of business;
(f) Investments (i) existing or contemplated on the date hereof Petition Date and set forth on Schedule 6.04(f) and any modification, replacement, renewal, reinvestment or extension thereof and (ii) Investments existing on the date hereof by Holdings, the Borrower or any Restricted Subsidiary in the Borrower or any Restricted Subsidiary and any modification, renewal or extension thereof; provided that the amount of the original Investment is not increased except by the terms of such Investment to the extent as set forth on Schedule 6.04(f) or as otherwise permitted by this Section 6.04;
(g) Investments in Swap Agreements permitted under Section 6.01(a)(vi)6.01;
(h) promissory notes and other non-cash consideration received in connection with Dispositions permitted by Section 6.05;
(i) Permitted Acquisitionsthe acquisition of BAN Precision Manufacturing;
(j) subject to the Transactionsconsent of the Required Lenders (in their sole discretion), Investments made by any Loan Party in any non-Loan Party consisting of contributions or other Dispositions of Equity Interests of Persons that are non-Loan Parties; provided that, prior to such contribution or Disposition, such Equity Interests were not owned directly by a Loan Party or such Equity Interests are contributed or disposed to a Non-Loan Party that is a wholly owned Restricted Subsidiary of a Loan Party;
(k) Investments in the ordinary course of business consisting of endorsements for collection or deposit and customary trade arrangements with customers consistent with past practices;
(l) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers and customers, from financially troubled account debtors or in settlement of delinquent obligations of, or other disputes with, customers and suppliers or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment;
(m) loans and advances subject to Holdings the consent of the Required Lenders (in their sole discretion), cash or property distributed from any direct or indirect parent thereofRestricted Subsidiary that is not a Loan Party (i) or any Intermediate Parent in lieu ofmay be contributed to other Restricted Subsidiaries that are not Loan Parties, and (ii) may pass through the Borrower and/or any intermediate Restricted Subsidiaries, so long as part of a series of related transactions and such transaction steps are not in excess of the amount of (after giving effect to any other loans, advances or Restricted Payments in respect thereof), Restricted Payments to the extent unreasonably delayed and are otherwise permitted to be made to Holdings (or such parent) or such Intermediate Parent in accordance with Section 6.08(a)hereunder;
(n) additional Investments and other acquisitionsacquisitions made and held by the Loan Parties; provided that at the time any such Investment or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition made in reliance on this clause (n), together with (including the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (n)), whether in the form of Indebtedness assumed or otherwise), shall not exceed the sum of (A) the greater of $18,000,000 and 60% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Investment or other acquisition, plus (B) so long as no Event of Default has occurred and is continuing, the Available Amount that is Not Otherwise Applied as in effect immediately prior to at the time of making incurrence thereof and after giving pro forma effect thereto, $500,000; provided that (x) the aggregate amount of such Investment100 Investments made by Loan Parties after the Effective Date in Restricted Subsidiaries that are not Loan Parties in reliance on this clause (n), together with the aggregate amount of (x) all other Investments made in and Dispositions made to Restricted Subsidiaries that are not Loan Parties by Loan Parties after the Effective Date and (y) all Investments and Dispositions made in reliance on Section 6.16(ii), shall not exceed, at the time of the making thereof and after giving pro forma effect thereto, $2,500,000 at any time outstanding and (y) all Investments made by Loan Parties in Restricted Subsidiaries that are not Loan Parties in reliance on this clause (n) shall be made only for the purpose of financing working capital needs of such non Loan Parties or another purpose agreed to by the Required Lenders (in their sole discretion) and shall be evidenced by an intercompany note that has been pledged as Collateral;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby[reserved];
(p) advances of payroll payments to employees in the ordinary course of business;
(q) Investments and other acquisitions to the extent that payment for such Investments is made with Qualified Equity Interests (excluding Cure Amounts) of Holdings (or any direct or indirect parent thereof or the IPO Entity)Borrower; provided that (i) such amounts used pursuant to this clause (q) shall not increase the Available Amount and (ii) any other amounts used for such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof or the IPO Entity) Borrower shall otherwise be permitted pursuant to this Section 6.04;
(r) Investments of a Subsidiary acquired after the Effective Date or of a Person merged or consolidated with any Subsidiary in accordance with this Section and Section 6.03 after the Effective Date to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger or consolidation and were in existence on the date of such acquisition, merger or consolidation[reserved];
(s) non-cash Investments in connection with tax planning and reorganization activities; provided that after giving effect to any such activities, the security interests of the Lenders in the Collateral, taken as a whole, would not be materially impaired[reserved];
(t) Investments consisting of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference to this Section 6.04(t)) under Sections 6.01, 6.02, 6.03, 6.05 and 6.08, respectively;
(u) additional Investments; provided that after giving effect to such Investment (A) on a Pro Forma Basis, the Total Net Leverage Ratio is less than or equal to 4.50 to 1.00 and (B) there is no continuing Event of Default[reserved];
(v) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the Borrower[reserved];
(w) to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Property, or other rights, in each case in the ordinary course of business;
(x) Investments by an Unrestricted Subsidiary entered into prior to the day such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to the definition of “Unrestricted Subsidiary”[reserved];
(y) Investments consisting of purchases of assets of Franchisees (including, but not limited to, area development contracts owned by Franchisees) in the ordinary course of business or otherwise in an amount not exceeding $60,000,000, so long as (A) no Event of Default shall have occurred and be continuing and (B) the Borrower is in pro forma compliance with the Financial Covenant after giving effect to any such purchase[reserved];
(z) So long as no Event of Default shall have occurred and be continuing, Investments in Franchisees (including, but not limited to, (i) Guarantees or other credit support of any Indebtedness and other liabilities thereof and (ii) loans, advances or contributions to the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater of $20,000,000 and 70% of Consolidated EBITDA[reserved];
(aa) Investments consisting of accounts and payment intangibles owing to the Borrower or any of the Restricted Subsidiaries from Franchisees; provided that such obligation shall be on such terms as the Borrower or the applicable Restricted Subsidiary establishes in good faith[reserved]; and
(bb) Investments consisting unfunded pension fund and other employee benefit plan obligations and liabilities to the extent that the same are permitted to remain unfunded under applicable Requirements of advances or expenditures by any Loan Party to, or on behalf of, any CMF Subsidiary in support of advertising and marketing programs in the ordinary course consistent with current practices. For purposes of determining compliance with this Section 6.04, in the event that any item of Investment meets the criteria of more than one of the categories of Investments described in clauses (a) through (bb) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such Investment (or any portion thereof) and will only be required to include the amount and type of such Investment in one or more of the above clausesLaw.
Appears in 1 contract
Samples: Superpriority Secured Debtor in Possession Credit Agreement (Invacare Corp)
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor the Borrower will, nor will they permit any Restricted Subsidiary or any Intermediate Parent to, make or hold any Investment, except:
(a) Permitted Investments at the time such Permitted Investment is made;cash and Cash Equivalents; 100 Blue Bird Body Company Credit Agreement
(b) loans or advances to officers, directors and employees of Holdings, any Intermediate Parent, the Borrower Holdings and the its Restricted Subsidiaries (i) for reasonable and customary business-related travel, entertainment, relocation and analogous ordinary business purposes, (ii) in connection with such Person’s purchase of Equity Interests in of Holdings (or any direct or indirect parent thereof) (provided that the amount of such loans and advances made in cash to such Person shall be contributed to the Borrower in cash as common equity or Qualified Equity Interests) and (iii) for purposes not described in the foregoing clauses (i) and (ii); provided that , in an aggregate principal amount outstanding at any time (excluding any paid in kind capitalized interest in respect thereof) not to exceed $5,000,000 (as determined at the time of incurrence thereof and after giving Pro Forma Effect thereto, the aggregate principal amount outstanding in reliance on this clause (iii) shall not exceed $1,000,000such Investment);
(c) Investments (i) by Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary in any of Loan Party, (ii) by any Restricted Subsidiary that is not a Loan Party in any other Restricted Subsidiary that is also not a Loan Party and (iii) by Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary; provided Subsidiary that the aggregate outstanding amount is not a Loan Party, constituting an exchange of Investments made by Loan Parties in Equity Interests of such Restricted Subsidiary for Indebtedness of such Restricted Subsidiary or constituting Guarantees of Indebtedness or other monetary obligations of Restricted Subsidiaries that are not Loan Parties in reliance on this clause (c) shall not exceed the greater of $10,000,000 and 35% of Consolidated EBITDAowing to any Loan Party;
(d) Investments consisting of prepayments to suppliers in the ordinary course of business;
(e) Investments consisting of extensions of trade credit in the ordinary course of business;
(f) Investments (i) existing or contemplated on the date hereof and set forth on Schedule 6.04(f6.04(d) and any modification, replacement, renewal, reinvestment or extension thereof and (ii) Investments existing on the date hereof by Holdings, the Borrower or any Restricted Subsidiary in the Borrower or any Restricted Subsidiary and any modification, renewal or extension thereof; provided that that, in each case, the amount of the original Investment is not increased except by the terms of such Investment to the extent as set forth on Schedule 6.04(f6.04(d) or as otherwise permitted by this Section 6.04;
(ge) Investments in Swap Agreements permitted under Section 6.01(a)(vi);
(hf) promissory notes and other non-cash consideration received in connection with Dispositions permitted by Section 6.05;
(ig) Permitted Acquisitions; provided that the aggregate amount of cash consideration paid or provided by any Loan Party or any Restricted Subsidiary after the Effective Date in reliance on this Section 6.04(g) (together with any Investments made in Restricted Subsidiaries that are not Loan Parties pursuant to Section 6.04(m)) for Permitted Acquisitions (including the aggregate principal amount of all Indebtedness assumed in connection with Permitted Acquisitions) for any Restricted Subsidiary that shall not be or, after giving effect to such Permitted Acquisition, shall not become a Loan Party (or for assets that are not purchased by, or promptly contributed to, a Loan Party), shall not exceed the Non-Loan Party Investment Amount at such time (as determined at the time of such Investment);
(j) the Transactions;
(k) Investments in the ordinary course of business consisting of endorsements for collection or deposit and customary trade arrangements with customers consistent with past practices;
(lh) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers and customers, from financially troubled account debtors customers or in settlement of delinquent obligations of, or other disputes with, customers and suppliers or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment;
(mi) loans and advances to Holdings (or any direct or indirect parent thereof) or any Intermediate Parent in lieu of, and not in excess of the amount of (after giving effect to any other loans, advances or Restricted Payments in respect thereof), Restricted Payments to the extent permitted to be made to Holdings (or such parent) or such Intermediate Parent in accordance with Section 6.08(a6.06(a)(iv);; 101 Blue Bird Body Company Credit Agreement
(nj) additional so long as no Event of Default shall have occurred and be continuing, other Investments and other acquisitionsby the Borrower or any Restricted Subsidiary; provided that at the time any such Investment or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition all Investments made in reliance on this clause (n), together with the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (n), j) shall not exceed the sum of (A) the greater of $18,000,000 and 60% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Investment or other acquisition, plus (B) so long as no Event of Default has occurred and is continuing, the Available Amount that is Not Otherwise Applied at such time (excluding any paid in kind capitalized interest in respect thereof and as in effect immediately prior to determined at the time of making of such Investment);
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby;
(pk) advances of payroll payments to employees in the ordinary course of business;
(ql) Investments and other acquisitions to the extent that payment for such Investments is made solely with Qualified Equity Interests (excluding Cure Amounts) of Holdings (or any direct or indirect parent thereof thereof);
(m) acquisitions of, Investments in, and loans and advances to, joint ventures and Unrestricted Subsidiaries by the Borrower and its Restricted Subsidiaries, so long as the aggregate amount invested, loaned or the IPO Entity); provided that (i) such amounts used pursuant to this clause (q) shall not increase the Available Amount and (ii) any amounts used for such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof or the IPO Entity) shall otherwise be permitted advanced pursuant to this Section 6.046.04(m) (determined without regard to any write-downs or write-offs of such investments, loans or advances), together with any Investments made in Restricted Subsidiaries that are not Loan Parties pursuant to Section 6.04(g), does not exceed the Non-Loan Party Investment Amount at such time (excluding any paid in kind capitalized interest in respect thereof and as determined at the time of such Investment);
(rn) Investments the licensing, sublicensing or contribution of a Subsidiary acquired after rights in any Intellectual Property pursuant to joint marketing arrangements with Persons other than Holdings and its Restricted Subsidiaries in the Effective Date or ordinary course of a Person merged or consolidated with any Subsidiary in accordance with this Section and Section 6.03 after the Effective Date to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger or consolidation and were in existence on the date of such acquisition, merger or consolidationbusiness;
(so) non-cash Investments in connection Restricted Subsidiaries of Borrower may be established or created if the Borrower and such Restricted Subsidiary comply with tax planning and reorganization activities; provided that after giving effect to any such activitiesthe requirements of Section 5.11, the security interests of the Lenders in the Collateral, taken as a whole, would not be materially impairedif applicable;
(t) Investments consisting of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference to this Section 6.04(t)) under Sections 6.01, 6.02, 6.03, 6.05 and 6.08, respectively;
(u) additional Investments; provided that after giving effect to such Investment (A) on a Pro Forma Basis, the Total Net Leverage Ratio is less than or equal to 4.50 to 1.00 and (B) there is no continuing Event of Default;
(v) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the Borrower;
(wp) to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials or and equipment or purchases, acquisitions, purchases of contract rights or licenses or leases of other assets, Intellectual Property, or other rightsintellectual property, in each case in the ordinary course of business;
(xq) Investments by an Unrestricted Subsidiary entered into prior in negotiable instruments deposited or to be deposited for collection in the day such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to the definition ordinary course of “Unrestricted Subsidiary”business;
(yr) Investments consisting of advances made in connection with purchases of assets goods or services in the ordinary course of Franchisees business;
(including, but not limited to, area development contracts owned by Franchiseess) deposits of cash made in the ordinary course of business or otherwise in an amount not exceeding $60,000,000, so long as (A) no Event to secure performance of Default shall have occurred and be continuing and (B) the Borrower is in pro forma compliance with the Financial Covenant after giving effect to any such purchaseoperating leases;
(zt) So long as no Event of Default shall have occurred and be continuing, guarantees permitted under Section 6.01(a);
(u) Investments held by a Person acquired in Franchisees (including, but not limited to, (i) Guarantees or other credit support of any Indebtedness and other liabilities thereof and (ii) loans, advances or contributions a Permitted Acquisition to the marketing and advertising funds operating extent that such Investments were not made in contemplation of or in connection with such Permitted Acquisition and were in existence on the European Wax Center franchise systemsdate of such Permitted Acquisition;
(v) Investments resulting from entering into Secured Cash Management Obligations; and 102 Blue Bird Body Company Credit Agreement
(w) other Investments by Holdings or any Restricted Subsidiary not to exceed, in the aggregate, at any time outstanding, (excluding any paid in kind capitalized interest in respect thereof) not to exceed $5,000,000 (as determined at the greater of $20,000,000 and 70% of Consolidated EBITDA;
(aa) Investments consisting of accounts and payment intangibles owing to the Borrower or any of the Restricted Subsidiaries from Franchisees; provided that such obligation shall be on such terms as the Borrower or the applicable Restricted Subsidiary establishes in good faith; and
(bb) Investments consisting of advances or expenditures by any Loan Party to, or on behalf of, any CMF Subsidiary in support of advertising and marketing programs in the ordinary course consistent with current practices. For purposes of determining compliance with this Section 6.04, in the event that any item of Investment meets the criteria of more than one of the categories of Investments described in clauses (a) through (bb) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such Investment (or any portion thereof) and will only be required to include the amount and type time of such Investment in one or more of the above clausesInvestment).
Appears in 1 contract
Samples: Credit Agreement (Blue Bird Corp)
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor the The Borrower willwill not, nor and will they not permit any of its Restricted Subsidiary or Intermediate Parent Subsidiaries to, make or hold permit to exist any InvestmentInvestment in any other Person, or purchase or otherwise acquire (in one transaction or a series of transactions) any assets of any other Person constituting a business unit, except:
(a) Permitted Investments at the time such Permitted Investment is madeInvestments;
(b) loans Investments existing on the date hereof or advances which on the date hereof are obligated to officers, directors be made and employees of Holdings, any Intermediate Parent, the Borrower and the Restricted Subsidiaries (i) for reasonable and customary business-related travel, entertainment, relocation and analogous ordinary business purposes, (ii) in connection with such Person’s purchase of Equity Interests in Holdings (or any direct or indirect parent thereof) (provided that the amount of such loans and advances made in cash to such Person shall be contributed to the Borrower in cash as common equity or Qualified Equity Interests) and (iii) for purposes not described in the foregoing clauses (i) and (ii); provided that at the time of incurrence thereof and after giving Pro Forma Effect thereto, the aggregate principal amount outstanding in reliance set forth on this clause (iii) shall not exceed $1,000,000Schedule 6.06;
(c) Investments by Holdings, the Borrower and its Restricted Subsidiaries in the Capital Stock of Restricted Subsidiaries that are Loan Parties; provided that such shares of Capital Stock shall be pledged pursuant to the Pledge Agreement;
(d) loans or advances made by the Borrower to any Intermediate Parent, Restricted Subsidiary (other than any Foreign Subsidiary) and made by any Restricted Subsidiary to the Borrower or any other Restricted Subsidiary in (other than any of Holdings, any Intermediate Parent, the Borrower or any Restricted Foreign Subsidiary); provided that any such loans and advances made by a Loan Party shall, (i) if evidenced by a promissory note, be pledged pursuant to the Pledge Agreement and (ii) the aggregate outstanding amount of Investments made by Loan Parties in Restricted to Subsidiaries that are not Loan Parties in reliance on this (including Investments pursuant to clause (cx) of the proviso to clause (e) below and pursuant to clause (k) below) shall not exceed the greater of $10,000,000 and 35% of Consolidated EBITDA;
(d) Investments consisting of prepayments to suppliers in the ordinary course of businessSpecial Investment Basket Amount;
(e) Investments consisting Permitted Business Acquisitions; provided that (A) such acquisitions are effected as stock acquisitions in which the consideration used to make such acquisitions consists of extensions common stock of trade credit the Borrower or Non-Cash Pay Preferred Stock of the Borrower and (B) to the extent not effected in accordance with clause (A), the ordinary course consideration for such Permitted Business Acquisitions is in an aggregate cumulative amount not at any time in excess of businessthe sum of (x) the portion of the Special Investment Basket Amount that is unused pursuant to Section 6.06(d) or 6.06(k) plus(y)(i) prior to the Global Closing Date, $200,000,000 or (ii) at any time thereafter, $300,000,000;
(f) Investments Guarantees constituting Indebtedness permitted by Sections 6.01 or 6.02 (i) existing or contemplated on the date hereof and set forth on Schedule 6.04(f) and any modification, replacement, renewal, reinvestment or extension thereof and (ii) Investments existing on the date hereof other than by Holdings, the Borrower or any Restricted Subsidiary in the Borrower or any Restricted Subsidiary and any modification, renewal or extension thereof; provided that the amount of the original Investment is not increased except by the terms of such Investment to the extent as set forth on Schedule 6.04(fSection 6.01(a)(iv) or as otherwise permitted by this Section 6.046.02(iv));
(g) Investments in Swap Agreements permitted under Section 6.01(a)(vi);
(h) promissory notes and other non-cash consideration received in connection with Dispositions permitted by Section 6.05;
(i) Permitted Acquisitions;
(j) the Transactions;
(k) Investments in the ordinary course satisfaction of business consisting of endorsements for collection judgments or deposit and customary trade arrangements with customers consistent with past practices;
(l) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers and customersof, from financially troubled account debtors or in settlement of delinquent obligations of, or other accounts and disputes with, customers and suppliers or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment;
(m) loans and advances to Holdings (or any direct or indirect parent thereof) or any Intermediate Parent in lieu of, and not in excess of the amount of (after giving effect to any other loans, advances or Restricted Payments in respect thereof), Restricted Payments to the extent permitted to be made to Holdings (or such parent) or such Intermediate Parent in accordance with Section 6.08(a);
(n) additional Investments and other acquisitions; provided that at the time any such Investment or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition made in reliance on this clause (n), together with the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (n), shall not exceed the sum of (A) the greater of $18,000,000 and 60% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Investment or other acquisition, plus (B) so long as no Event of Default has occurred and is continuing, the Available Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of such Investment;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby;
(p) advances of payroll payments to employees in the ordinary course of business;
(q) Investments and other acquisitions to the extent that payment for such Investments is made with Qualified Equity Interests (excluding Cure Amounts) of Holdings (or any direct or indirect parent thereof or the IPO Entity); provided that (i) such amounts used pursuant to this clause (q) shall not increase the Available Amount and (ii) any amounts used for such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof or the IPO Entity) shall otherwise be permitted pursuant to this Section 6.04;
(r) Investments of a Subsidiary acquired after the Effective Date or of a Person merged or consolidated with any Subsidiary in accordance with this Section and Section 6.03 after the Effective Date to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger or consolidation and were in existence on the date of such acquisition, merger or consolidation;
(s) non-cash Investments in connection with tax planning and reorganization activities; provided that after giving effect to any such activities, the security interests of the Lenders in the Collateral, taken as a whole, would not be materially impaired;
(t) Investments consisting of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference to this Section 6.04(t)) under Sections 6.01, 6.02, 6.03, 6.05 and 6.08, respectively;
(u) additional Investments; provided that after giving effect to such Investment (A) on a Pro Forma Basis, the Total Net Leverage Ratio is less than or equal to 4.50 to 1.00 and (B) there is no continuing Event of Default;
(v) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the Borrower;
(w) to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Property, or other rightssuppliers, in each case in the ordinary course of business;
(xh) Investments by an Unrestricted Subsidiary entered into prior loans, advances or extensions of credit to the day such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to the definition of “Unrestricted Subsidiary”;
(y) Investments consisting of purchases of assets of Franchisees (including, but not limited to, area development contracts owned by Franchisees) employees and directors made in the ordinary course of business or otherwise in an amount not exceeding $60,000,000, so long as (A) no Event of Default shall have occurred and be continuing and (B) the Borrower is in pro forma compliance with the Financial Covenant after giving effect to any such purchasebusiness;
(zi) So long as no Event of Default shall have occurred and be continuing, Investments in Franchisees Hedging Agreements;
(includingj) Investments received as a result of asset sales permitted by Section 6.07;
(k) other Investments in Unrestricted Subsidiaries, but Restricted Subsidiaries that are not limited to, Loan Parties or other Persons the consideration for which consists of (i) Guarantees shares of common stock of the Borrower or other credit support Non-Cash Pay Preferred Stock of any Indebtedness and other liabilities thereof and the Borrower or (ii) loans, advances cash or contributions to the marketing and advertising funds operating other consideration in connection with the European Wax Center franchise systems) an aggregate cumulative amount not to exceed (including Investments pursuant to clause (d) above and pursuant to clause (x) of the greater of $20,000,000 and 70% of Consolidated EBITDAproviso to clause (e) above) the Special Investment Basket Amount;
(aal) Investments consisting of accounts and payment intangibles owing to the Borrower or any of the Restricted Subsidiaries from FranchiseesGlobal Acquisition; provided that such obligation shall be on such acquisition is made in accordance with the terms as and provisions of the Borrower Global Merger Agreement without modification or amendment adverse to the applicable Lenders in a material respect;
(m) Investments of any Person that becomes a Restricted Subsidiary establishes after the date hereof; provided that such Investment exists at the time such Person becomes a Restricted Subsidiary and is not made in good faithcontemplation of or in connection with such Person becoming a Restricted Subsidiary; 49
(n) Investments in the Asia-Pacific Joint Venture not at any time in excess of $600,000,000; and
(bbo) Investments consisting made with the proceeds of advances or expenditures payments made to the Borrower by any Loan Party toGlobalCrossing North America, or on behalf of, any CMF Subsidiary Inc. in support order to fund Capital Expenditures of advertising and marketing programs in the ordinary course consistent with current practices. For purposes of determining compliance with this Section 6.04, in the event that any item of Investment meets the criteria of more than one Restricted Subsidiaries permitted by clause (iii) of the categories final sentence of Investments described in clauses (a) through (bb) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such Investment (or any portion thereof) and will only be required to include the amount and type of such Investment in one or more of the above clausesSection 6.20(b).
Appears in 1 contract
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor the The Borrower willwill not, nor and will they not permit any Restricted Subsidiary or Intermediate Parent to, make or hold any Investment, except:
(a) Permitted Investments at the time such Permitted Investment is madeInvestments;
(b) loans or advances to officers, directors members of the Board of Directors and employees of Holdings, any Intermediate Parent, the Borrower and the its Restricted Subsidiaries (i) for reasonable and customary business-related travel, entertainment, relocation and analogous ordinary business purposes, (ii) in connection with such Person’s purchase of Equity Interests in of Holdings (or any direct or indirect parent thereof) (provided that the amount of such loans and advances made in cash to such Person shall be contributed to the Borrower in cash as common equity or Qualified Equity Interests) and (iii) for purposes not described in the foregoing clauses (i) and (ii); provided that at the time of incurrence thereof and after giving Pro Forma Effect thereto, the in an aggregate principal amount outstanding in reliance on this clause (iii) shall at any time not to exceed $1,000,00020,000,000;
(c) Investments (i) by Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary in any of HoldingsLoan Party (excluding any new Restricted Subsidiary that becomes a Loan Party pursuant to such Investment), (ii) by any Intermediate ParentRestricted Subsidiary that is not a Loan Party in any other Restricted Subsidiary that is also not a Loan Party, (iii) by the Borrower or any Restricted Subsidiary (A) in any Restricted Subsidiary; provided that the aggregate outstanding amount of such Investments made by Loan Parties after the Second Amendment Effective Date in Restricted Subsidiaries that are not Loan Parties in reliance on this clause (ciii)(A) (together with the amount of Investments made in Restricted Subsidiaries that are not Loan Parties pursuant to Section 6.04(h)) shall not exceed the greater Non-Loan Party Investment Amount at the time of $10,000,000 any such Investment, (B) in any Restricted Subsidiary that is not a Loan Party, constituting an exchange of Equity Interests of such Restricted Subsidiary for Indebtedness of such Subsidiary or (C) constituting Guarantees of Indebtedness or other monetary obligations of Restricted Subsidiaries that are not Loan Parties owing to any Loan Party, (iv) by the Borrower or any Restricted Subsidiary in Restricted Subsidiaries that are not Loan Parties so long as such Investment is part of a series of simultaneous Investments that result in the proceeds of the initial Investment being invested in one or more Loan Parties and 35% (v) by the Borrower or any Restricted Subsidiary in any Restricted Subsidiary that is not a Loan Party, consisting of Consolidated EBITDAthe contribution of Equity Interests of any other Restricted Subsidiary that is not a Loan Party so long as the Equity Interests of the transferee Restricted Subsidiary is pledged to secure the Secured Obligations;
(d) Investments consisting of prepayments to suppliers extensions of trade credit and accommodation guarantees in the ordinary course of business;
(e) Investments consisting of extensions of trade credit in the ordinary course of business;
(f) Investments (i) existing or contemplated on the date hereof Second Amendment Effective Date and set forth on Schedule 6.04(f6.04(e) and any modification, replacement, renewal, reinvestment or extension thereof and (ii) Investments existing on the date hereof Second Amendment Effective Date by Holdings, the Borrower or any Restricted Subsidiary in the Borrower or any Restricted Subsidiary and any modification, renewal or extension thereof; provided that the amount of the original Investment is not increased except by the terms of such Investment to the extent as set forth on Schedule 6.04(f6.04(e) or as otherwise permitted by this Section 6.04;
(gf) Investments in Swap Agreements permitted under Section 6.01(a)(vi)incurred in the ordinary course of business and not for speculative purposes;
(hg) promissory notes and other non-cash consideration received in connection with Dispositions permitted by Section 6.05;
(ih) Permitted Acquisitions; provided that the aggregate amount of consideration paid or provided by the Borrower or any other Loan Party after the Second Amendment Effective Date in reliance on this Section 6.04(h) (together with any Investments made in Subsidiaries that are not Loan Parties pursuant to Section 6.04(c)(iii)(A)) for Permitted Acquisitions (including the aggregate principal amount of all Indebtedness assumed in connection with Permitted Acquisitions) for any Restricted Subsidiary that shall not be or, after giving effect to such Permitted Acquisition, shall not become a Loan Party, shall not exceed the Non-Loan Party Investment Amount at such time;
(i) the Second Amendment Transactions;
(j) the Transactions;
(k) Investments in the ordinary course of business consisting of Uniform Commercial Code Article 3 endorsements for collection or deposit and Uniform Commercial Code Article 4 customary trade arrangements with customers consistent with past practices;
(lk) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers and customers, from financially troubled account debtors customers or in settlement of delinquent obligations of, or other disputes with, customers and suppliers or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment;
(ml) loans and advances to Holdings (or any direct or indirect parent thereof) or any Intermediate Parent in lieu of, and not in excess of the amount of (after giving effect to any other loans, advances or Restricted Payments in respect thereof), Restricted Payments to the extent permitted to be made to Holdings (or such parent) or such Intermediate Parent in accordance with Section 6.08(a6.07(a)(iv), (v), (vi), (vii) or (viii);
(nm) additional so long as immediately after giving effect to any such Investment no Event of Default has occurred and is continuing, other Investments and other acquisitions; provided that at the time any such Investment or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition all Investments made in reliance on this clause (nm) (including all such Investments deemed to be made pursuant to clause (d) of the definition of “Non-Loan Party Investment Amount”), together with the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (nm) (including the aggregate principal amount of all Indebtedness assumed in connection with any such other acquisition), shall not exceed the sum of (Aw) the greater of $18,000,000 105,000,000 and 6050% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Investment or other acquisition, plus (Bx) so long as no Event of Default has occurred and is continuing, the Available Initial Restricted Payment Amount that is Not Otherwise Applied plus (y) so long as (A) the Fixed Charge Coverage Ratio for the Test Period then last ended shall be at least 2.00 to 1.00, and (B) the Borrower shall be in effect immediately prior Pro Forma Compliance with the Financial Performance Covenant as of the end of the most recent Test Period, the amount of Cumulative Excess Cash Flow that is Not Otherwise Applied plus (z) the aggregate amount of the Net Proceeds of the issuance of, or contribution of cash in respect of existing Qualified Equity Interests (other than any such issuance or contribution made pursuant to the time of making of such InvestmentSection 7.02) that is Not Otherwise Applied;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby;
(pn) advances of payroll payments to employees in the ordinary course of business;
(qo) Investments and other acquisitions to the extent that payment for such Investments is made solely with Qualified Equity Interests (excluding Cure Amounts) of Holdings (or any direct or indirect parent thereof or the IPO Entity); provided that (i) such amounts used pursuant to this clause (q) shall not increase the Available Amount and (ii) any amounts used for such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof or the IPO Entity) shall otherwise be permitted pursuant to this Section 6.04;
(rp) Investments of a Subsidiary acquired after the Second Amendment Effective Date or of a Person merged or consolidated with any Subsidiary in accordance with this Section 6.04 and Section 6.03 after the Second Amendment Effective Date or that otherwise becomes a Subsidiary (provided that if such Investment is made under Section 6.04(h), existing Investments in subsidiaries of such Subsidiary or Person shall comply with the requirements of Section 6.04(h) or 6.04(m) or any other paragraph of this Section 6.04) to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger or consolidation and were in existence on the date of such acquisition, merger or consolidation;
(sq) receivables owing to the Borrower or any Restricted Subsidiary, if created or acquired in the ordinary course of business;
(r) non-cash Investments in connection with tax planning and reorganization activities; provided that that, in the reasonable judgment of the Administrative Agent (following consultation with the Borrower), after giving effect to any such activities, the security interests of the Lenders in the Collateral, taken as a whole, would not be materially impaired;; and
(ts) Investments consisting of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference to this Section 6.04(t)) under Sections 6.01, 6.02, 6.03, 6.05 and 6.08, respectively;
(u) additional Investments; provided that after giving effect to such Investment (A) on a Pro Forma Basisfor utilities, security deposits, leases and similar prepaid expenses incurred in the Total Net Leverage Ratio is less than or equal to 4.50 to 1.00 ordinary course of business and (B) there is no continuing Event of Default;
(v) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the Borrower;
(w) to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Propertytrade accounts created, or other rightsprepaid expenses accrued, in each case in the ordinary course of business;
(x) Investments by an Unrestricted Subsidiary entered into prior to the day such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to the definition of “Unrestricted Subsidiary”;
(y) Investments consisting of purchases of assets of Franchisees (including, but not limited to, area development contracts owned by Franchisees) in the ordinary course of business or otherwise in an amount not exceeding $60,000,000, so long as (A) no Event of Default shall have occurred and be continuing and (B) the Borrower is in pro forma compliance with the Financial Covenant after giving effect to any such purchase;
(z) So long as no Event of Default shall have occurred and be continuing, Investments in Franchisees (including, but not limited to, (i) Guarantees or other credit support of any Indebtedness and other liabilities thereof and (ii) loans, advances or contributions to the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater of $20,000,000 and 70% of Consolidated EBITDA;
(aa) Investments consisting of accounts and payment intangibles owing to the Borrower or any of the Restricted Subsidiaries from Franchisees; provided that such obligation shall be on such terms as the Borrower or the applicable Restricted Subsidiary establishes in good faith; and
(bb) Investments consisting of advances or expenditures by any Loan Party to, or on behalf of, any CMF Subsidiary in support of advertising and marketing programs in the ordinary course consistent with current practices. For purposes of determining compliance with this Section 6.04, in the event that any item of Investment meets the criteria of more than one of the categories of Investments described in clauses (a) through (bb) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such Investment (or any portion thereof) and will only be required to include the amount and type of such Investment in one or more of the above clauses.
Appears in 1 contract
Samples: Credit Agreement (Endurance International Group Holdings, Inc.)
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor the Borrower willThe Company will not, nor and will they not permit any Restricted Subsidiary or Intermediate Parent of the Subsidiaries to, make or hold any Investment, Investment except:
(a) Permitted Investments at the time such Permitted Investment is madeInvestments;
(b) loans or advances to officers, directors and employees Investments of Holdings, any Intermediate Parent, the Borrower Company and the Restricted Subsidiaries (i) for reasonable and customary business-related travel, entertainment, relocation and analogous ordinary business purposes, (ii) in connection with such Person’s purchase Subsidiary Guarantors that are set forth on Schedule 6.04 of Equity Interests in Holdings (or any direct or indirect parent thereof) (provided that the amount of such loans and advances made in cash to such Person shall be contributed to the Borrower in cash as common equity or Qualified Equity Interests) and (iii) for purposes not described in the foregoing clauses (i) and (ii); provided that at the time of incurrence thereof and after giving Pro Forma Effect thereto, the aggregate principal amount outstanding in reliance on this clause (iii) shall not exceed $1,000,000ABL Credit Agreement;
(c) Investments Guarantees of Debt and/or Guarantees consisting of Debt permitted by Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary in any of Holdings, any Intermediate Parent, the Borrower or any Restricted Subsidiary; provided that the aggregate outstanding amount of Investments made by Loan Parties in Restricted Subsidiaries that are not Loan Parties in reliance on this clause (c) shall not exceed the greater of $10,000,000 and 35% of Consolidated EBITDASection 4.03;
(d) Investments consisting of prepayments to suppliers in the ordinary course of business;
(e) Investments consisting of extensions of trade credit in the ordinary course of business;
(f) Investments (i) existing or contemplated on the date hereof and set forth on Schedule 6.04(f) and any modification, replacement, renewal, reinvestment or extension thereof and (ii) Investments existing on the date hereof by Holdings, the Borrower or any Restricted Subsidiary in the Borrower or any Restricted Subsidiary and any modification, renewal or extension thereof; provided that the amount of the original Investment is not increased except by the terms of such Investment to the extent as set forth on Schedule 6.04(f) or as otherwise permitted by this Section 6.04;
(g) Investments in Swap Agreements permitted under Section 6.01(a)(vi);
(h) promissory notes and other non-cash consideration received in connection with Dispositions permitted by Section 6.05;
(i) Permitted Acquisitions;
(j) the Transactions;
(k) Investments in the ordinary course of business consisting of endorsements for collection or deposit and customary trade arrangements with customers consistent with past practices;
(l) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers and customersof, from financially troubled account debtors or in settlement of delinquent obligations of, or other accounts and disputes with, customers and suppliers or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment;
(m) loans and advances to Holdings (or any direct or indirect parent thereof) or any Intermediate Parent in lieu of, and not in excess of the amount of (after giving effect to any other loans, advances or Restricted Payments in respect thereof), Restricted Payments to the extent permitted to be made to Holdings (or such parent) or such Intermediate Parent in accordance with Section 6.08(a);
(n) additional Investments and other acquisitions; provided that at the time any such Investment or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition made in reliance on this clause (n), together with the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (n), shall not exceed the sum of (A) the greater of $18,000,000 and 60% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Investment or other acquisition, plus (B) so long as no Event of Default has occurred and is continuing, the Available Amount that is Not Otherwise Applied as in effect immediately prior to the time of making of such Investment;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby;
(p) advances of payroll payments to employees in the ordinary course of business;
(q) Investments and other acquisitions to the extent that payment for such Investments is made with Qualified Equity Interests (excluding Cure Amounts) of Holdings (or any direct or indirect parent thereof or the IPO Entity); provided that (i) such amounts used pursuant to this clause (q) shall not increase the Available Amount and (ii) any amounts used for such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof or the IPO Entity) shall otherwise be permitted pursuant to this Section 6.04;
(r) Investments of a Subsidiary acquired after the Effective Date or of a Person merged or consolidated with any Subsidiary in accordance with this Section and Section 6.03 after the Effective Date to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger or consolidation and were in existence on the date of such acquisition, merger or consolidation;
(s) non-cash Investments in connection with tax planning and reorganization activities; provided that after giving effect to any such activities, the security interests of the Lenders in the Collateral, taken as a whole, would not be materially impaired;
(t) Investments consisting of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference to this Section 6.04(t)) under Sections 6.01, 6.02, 6.03, 6.05 and 6.08, respectively;
(u) additional Investments; provided that after giving effect to such Investment (A) on a Pro Forma Basis, the Total Net Leverage Ratio is less than or equal to 4.50 to 1.00 and (B) there is no continuing Event of Default;
(v) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the Borrower;
(w) to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Property, or other rightssuppliers, in each case in the ordinary course of business;
(xi) Investments by the Company or any Subsidiary Guarantor in Subsidiary Guarantors; provided that the Company and such Subsidiary Guarantor, as the case may be, shall comply with the applicable provisions of Section 4.08 with respect to any newly formed Subsidiary, (ii) Investments by the Subsidiaries in the Company; provided that the proceeds of such Investments are used for general corporate and ongoing working capital purposes, (iii) Investments by any Subsidiary that is not a Subsidiary Guarantor in any other Subsidiary that is not a Subsidiary Guarantor or in any Subsidiary Guarantor, and (iv) other Investments by the Company or any Subsidiary Guarantor in any Subsidiary that is not a Subsidiary Guarantor in an Unrestricted amount not to exceed $5,500,000 in the aggregate at any one time; provided that any Debt of the Company or any Subsidiary entered into prior Guarantor in respect of such Investment (if any) is subordinated to the day such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary Securities Obligations pursuant to terms substantially the definition of “Unrestricted Subsidiary”same as those forth on Annex I hereto;
(yf) Investments consisting of purchases non-cash consideration received in connection with any Asset Sale permitted by Section 4.06 (other than with respect to any sale of assets of Franchisees (including, but not limited to, area development contracts owned by Franchisees) Inventory at retail in the ordinary course of business or otherwise business);
(g) usual and customary loans and advances to employees, officers and directors of the Company and the Subsidiaries, in the ordinary course of business; provided that the aggregate amount of such loans and advances outstanding at any time shall not exceed $11,000,000;
(h) Investments in charitable foundations organized under Section 501(c) of the Code in an amount not exceeding to exceed $60,000,0003,300,000 in the aggregate in any calendar year;
(i) any Investment consisting of a Hedging Agreement permitted by Section 4.14;
(j) Investments held by any Person that becomes a Subsidiary at the time such Person becomes a Subsidiary; provided that no such Investment was made in contemplation of such Person becoming a Subsidiary;
(k) Investments consisting of Guarantees by the Company or any of its Subsidiaries of obligations of the Company or any of its Subsidiaries to the extent not constituting Debt and incurred in the ordinary course of business; and
(l) Business Acquisitions and other Investments that are not otherwise permitted under any other provision of this Section 4.10; provided that, so long as (A) no Event of Default shall have occurred the date of such Business Acquisition or other Investment, and be continuing and (B) the Borrower is in pro forma compliance with the Financial Covenant after giving effect thereto, each of the Payment Conditions shall be satisfied. Notwithstanding anything to the contrary set forth in this Indenture or in any such purchase;
(z) So long as no Event of Default shall have occurred and be continuing, Investments in Franchisees (including, but not limited toother Securities Document, (i) Guarantees no Investment shall be made by any Securities Party to any other Securities Party or other credit support third party in the form of any Indebtedness and other liabilities thereof Real Estate, and (ii) loans, advances or contributions to the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater of $20,000,000 and 70% of Consolidated EBITDA;
(aa) Investments consisting of accounts and payment intangibles owing to the Borrower or any of the Restricted Subsidiaries from Franchisees; provided that such obligation no Investment shall be on such terms as the Borrower or the applicable Restricted Subsidiary establishes in good faith; and
(bb) Investments consisting of advances or expenditures by any Loan Party to, or on behalf of, any CMF Subsidiary in support of advertising and marketing programs in the ordinary course consistent with current practices. For purposes of determining compliance with this Section 6.04, in the event that any item of Investment meets the criteria of more than one of the categories of Investments described in clauses (a) through (bb) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such Investment (or any portion thereof) and will only be required to include the amount and type Investment of such Investment Intellectual Property in one or more of the above clausesany Person that is not a Securities Party.
Appears in 1 contract
Investments, Loans, Advances, Guarantees and Acquisitions. Neither Holdings nor the Borrower willThe Company will not, nor will they it permit any Restricted Subsidiary or Intermediate Parent to, make or hold any Investment, except:
(a) Permitted Investments at the time such Permitted Investment is made;
(b) loans or advances to present or former officers, directors directors, managers, members of management, consultants, independent contractors and employees of Holdings, any Intermediate Parent, the Borrower Company and the Restricted Subsidiaries (i) for reasonable and customary business-related travel, entertainment, relocation and analogous ordinary business purposes, (ii) in connection with such Person’s purchase of Equity Interests in Holdings (or any direct or indirect parent thereof) the Company (provided that the amount of such loans and advances made in cash to such Person shall be contributed to the Borrower Company in cash as common equity or Qualified Equity Interests) and (iii) for purposes not described in the foregoing clauses (i) and (ii); provided that at the time of incurrence thereof and after giving Pro Forma Effect pro forma effect thereto, the aggregate principal amount outstanding in reliance on this clause (iii) shall not exceed $1,000,0005,000,000;
(c) Investments (i) by Holdings, any Intermediate Parent, the Borrower Company or any Restricted Subsidiary in any Note Party (other than the Company (except to the extent the proceeds of Holdingsany such Investment are promptly invested in a Restricted Subsidiary in a transaction otherwise permitted hereunder)), provided that to the extent the aggregate amount of Investments by a Restricted Subsidiary that is not a Note Party in a Note Party exceeds $1,000,000, such non-Note Party Restricted Subsidiary shall have acceded to the Pari Passu Intercreditor Agreement pursuant to the terms thereof, (ii) by any Intermediate ParentRestricted Subsidiary that is not a Note Guarantor in any other Restricted Subsidiary that is also not a Note Guarantor, (iii) by the Borrower Company or any Restricted Subsidiary (A) in any Restricted Subsidiary; provided that (x) the aggregate outstanding amount of such Investments made by Loan Note Parties after the Issue Date in Restricted Subsidiaries that are not Note Guarantor in reliance on this clause (iii)(A), together with the aggregate amount of (I) all other Investments made in and Dispositions made to Restricted Subsidiaries that are not Note Guarantors by any Note Parties after the Issue Date and (II) all Investments and Dispositions made in reliance on Section 4.28(ii), shall not exceed, at the time of the making thereof and after giving pro forma effect thereto, $7,500,000, (y) no Event of Default has occurred and is continuing and (z) all Investments made by Note Parties in Restricted Subsidiaries that are not Loan Note Parties in reliance on this clause (ciii)(A) shall be made only for the purpose of financing working capital needs of such non-Note Parties or another purpose agreed to by the Required Holders (such consent not exceed to be unreasonably withheld, conditioned or delayed; provided, that it is acknowledged and agreed that it shall not be unreasonable to withhold consent to any such transaction that will have a material adverse impact on the greater Note Guarantees or the Collateral) and shall be evidenced by an intercompany note that has been pledged as Collateral, (B) [reserved] or (C) constituting Guarantees of $10,000,000 Indebtedness or other monetary obligations of Restricted Subsidiaries that are not Note Guarantors owing to any Note Party, (iv) by the Company or any Restricted Subsidiary in Restricted Subsidiaries that are not Note Guarantors so long as such transaction is part of a series of simultaneous transactions that results in the proceeds of the initial Investment being invested in one or more Note Parties (other than the Company) and 35% (v) subject to the consent of Consolidated EBITDAthe Required Holders (such consent not to be unreasonably withheld, conditioned or delayed; provided, that it is acknowledged and agreed that it shall not be unreasonable to withhold consent to any such transaction that will have a material adverse impact on the Note Guarantees or the Collateral) by the Company or any Restricted Subsidiary in any Restricted Subsidiary that is not a Note Guarantor, consisting of the contribution of Equity Interests of any other Restricted Subsidiary that is not a #96856647v2 Note Guarantor so long as the Equity Interests of the transferee Restricted Subsidiary is pledged to secure the Notes Obligations;
(d) Investments consisting of deposits, prepayments and/or other credits to suppliers in the ordinary course of business;
(e) Investments consisting of extensions of trade credit in the ordinary course of business;
(f) Investments (i) existing or contemplated on the date hereof and set forth on Schedule 6.04(f) Issue Date and any modification, replacement, renewal, reinvestment or extension thereof and (ii) Investments existing on the date hereof Issue Date by Holdings, the Borrower or any Restricted Subsidiary in the Borrower Company or any Restricted Subsidiary and any modification, renewal or extension thereof; provided that the amount of the original Investment is not increased except by the terms of such Investment to the extent as set forth on Schedule 6.04(f) or as otherwise permitted by this Section 6.044.13;
(g) Investments in Swap Agreements permitted under Section 6.01(a)(vi)4.10;
(h) promissory notes and other non-cash consideration received in connection with Dispositions permitted by Section 6.054.14;
(i) Permitted AcquisitionsInvestments made in connection with the Transactions (other than borrowings under the ABL North America Credit Agreement);
(j) subject to the Transactionsconsent of the Required Holders (such consent not to be unreasonably withheld, conditioned or delayed; provided, that it is acknowledged and agreed that it shall not be unreasonable to withhold consent to any such transaction that will have a material adverse impact on the Note Guarantees or the Collateral), Investments made by any Note Party in any non-Note Party consisting of contributions or other Dispositions of Equity Interests of Persons that are non-Note Parties; provided that, prior to such contribution or Disposition, such Equity Interests were not owned directly by a Note Party or such Equity Interests are contributed or disposed to a Non-Note Party that is a wholly owned Restricted Subsidiary of a Note Party;
(k) Investments in the ordinary course of business consisting of endorsements for collection or deposit and customary trade arrangements with customers consistent with past practices;
(l) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or reorganization of suppliers and customers, from financially troubled account debtors or in settlement of delinquent obligations of, or other disputes with, customers and suppliers or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment;
(m) loans subject to the consent of the Required Holders (such consent not to be unreasonably withheld, conditioned or delayed; provided, that it is acknowledged and advances agreed that it shall not be unreasonable to Holdings withhold consent to any such transaction that will have a material adverse impact on the Note Guarantees or the Collateral), cash or property distributed from any Restricted Subsidiary that is not a Note Party (or any direct or indirect parent thereofi) or any Intermediate Parent in lieu ofmay be contributed to other Restricted Subsidiaries that are not Note Parties, and not (ii) may pass through the Company, Invacare Corporation and/or any intermediate Restricted Subsidiaries in excess of order to effect the amount of contribution described in clause (after giving effect to any other loans, advances or Restricted Payments in respect thereofi), Restricted Payments to the extent so long as part of a series of related transactions and such transaction steps are not unreasonably delayed and are otherwise permitted to be made to Holdings (or such parent) or such Intermediate Parent in accordance with Section 6.08(a)hereunder;
(n) additional Investments and other acquisitionsacquisitions made and held by the Note Parties (other than the Company); provided that at the time any such Investment or other acquisition is made, the aggregate outstanding amount of such Investment or acquisition made in reliance on this clause (n), together with (including the aggregate amount of all consideration paid in connection with all other Investments and acquisitions made in reliance on this clause (n)), whether in the form of Indebtedness assumed or otherwise), shall not exceed the sum of (A) the greater of $18,000,000 and 60% of Consolidated EBITDA for the most recently ended Test Period after giving Pro Forma Effect to the making of such Investment or other acquisition, plus (B) so long as no Event of Default has occurred and is continuing, the Available Amount that is Not Otherwise Applied as in effect immediately prior to at the time of making incurrence thereof and after giving pro forma effect thereto, $2,500,000; provided that (x) the aggregate amount of such InvestmentInvestments made by Note Parties after the Issue Date in Restricted Subsidiaries that are not Note Guarantors in reliance on this clause (n), together with the aggregate amount of all (i) other Investments made in and Dispositions made to Restricted Subsidiaries that are not Note Guarantors by the Note Parties after the Issue Date and (ii) all Investments and Dispositions made in reliance on Section 4.28(ii), shall not exceed, at the time of the making thereof and after giving pro forma effect thereto, $7,500,000 at any time outstanding; and (y) all Investments made by Note Parties in Restricted Subsidiaries that are not Note Parties in reliance on this clause (n), shall be #96856647v2 made only for the purpose of financing working capital needs of such non-Note Parties or another purpose agreed to by the Required Holder (such consent not to be unreasonably withheld, conditioned or delayed; provided, that it is acknowledged and agreed that it shall not be unreasonable to withhold consent to any such transaction that will have a material adverse impact on the Note Guarantees or the Collateral) and shall be evidenced by an intercompany note that has been pledged as Collateral;
(o) Holdings and its Subsidiaries may undertake or consummate any IPO Reorganization Transaction and transactions relating thereto or contemplated thereby[reserved];
(p) advances of payroll payments to employees in the ordinary course of business;
(q) Investments and other acquisitions to the extent that payment for such Investments is made with Qualified Equity Interests (excluding Cure Amounts) of Holdings (or any direct or indirect parent thereof or the IPO Entity)Company; provided that (i) such amounts used pursuant to this clause (q) shall not increase the Available Amount and (ii) any other amounts used for such an Investment or other acquisition that are not Qualified Equity Interests of Holdings (or any direct or indirect parent thereof or the IPO Entity) Company shall otherwise be permitted pursuant to this Section 6.044.13;
(r) Investments of a Subsidiary acquired after the Effective Date or of a Person merged or consolidated with any Subsidiary in accordance with this Section and Section 6.03 after the Effective Date to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger or consolidation and were in existence on the date of such acquisition, merger or consolidation[reserved];
(s) non-cash Investments in connection with tax planning and reorganization activities; provided that after giving effect to any such activities, the security interests of the Lenders in the Collateral, taken as a whole, would not be materially impaired[reserved];
(t) Investments consisting of Indebtedness, Liens, fundamental changes, Dispositions and Restricted Payments permitted (other than by reference to this Section 6.04(t4.13(t)) under Sections 6.014.10, 6.024.11, 6.034.12, 6.05 and 6.084.14, 4.17, respectively;
(u) additional Investments; provided that after giving effect to such Investment (A) on a Pro Forma Basis, the Total Net Leverage Ratio is less than or equal to 4.50 to 1.00 and (B) there is no continuing Event of Default[reserved];
(v) contributions to a “rabbi” trust for the benefit of employees, directors, consultants, independent contractors or other service providers of the Company or any Restricted Subsidiary or other grantor trust subject to claims of creditors in the case of a bankruptcy of Holdings or the BorrowerCompany;
(w) to the extent that they constitute Investments, purchases and acquisitions of inventory, supplies, materials or equipment or purchases, acquisitions, licenses or leases of other assets, Intellectual Property, or other rights, in each case in the ordinary course of business;
(x) Investments by an Unrestricted Subsidiary entered into prior to the day such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary pursuant to the definition of “Unrestricted Subsidiary”[reserved];
(y) Investments consisting of purchases of assets of Franchisees (including, but not limited to, area development contracts owned by Franchisees) in the ordinary course of business or otherwise in an amount not exceeding $60,000,000, so long as (A) no Event of Default shall have occurred and be continuing and (B) the Borrower is in pro forma compliance with the Financial Covenant after giving effect to any such purchase[reserved];
(z) So long as no Event of Default shall have occurred and be continuing, Investments in Franchisees (including, but not limited to, (i) Guarantees or other credit support of any Indebtedness and other liabilities thereof and (ii) loans, advances or contributions to the marketing and advertising funds operating in connection with the European Wax Center franchise systems) not to exceed the greater of $20,000,000 and 70% of Consolidated EBITDA[reserved];
(aa) Investments consisting of accounts and payment intangibles owing to the Borrower or any of the Restricted Subsidiaries from Franchisees; provided that such obligation shall be on such terms as the Borrower or the applicable Restricted Subsidiary establishes in good faith[reserved]; and
(bb) Investments consisting unfunded pension fund and other employee benefit plan obligations and liabilities to the extent that the same are permitted to remain unfunded under applicable Requirements of advances or expenditures by any Loan Party to, or on behalf of, any CMF Subsidiary in support of advertising and marketing programs in the ordinary course consistent with current practices. For purposes of determining compliance with this Section 6.04, in the event that any item of Investment meets the criteria of more than one of the categories of Investments described in clauses (a) through (bb) above, Holdings shall, in its sole discretion, classify and reclassify or later divide, classify or reclassify such Investment (or any portion thereof) and will only be required to include the amount and type of such Investment in one or more of the above clausesLaw.
Appears in 1 contract
Samples: Indenture (INVACARE HOLDINGS Corp)
