Common use of Investments or Loans Clause in Contracts

Investments or Loans. Except as otherwise expressly permitted by this Section 7.4, neither the Company nor any of its Subsidiaries shall make or permit to exist any investment in, or make, accrue or permit to exist loans or advances of money to, any Person, through the direct or indirect lending of money, holding of securities or otherwise, except that (a) the Company and its Subsidiaries may make Loans that comply with the Credit and Collection Policy and Requirements of Law and up to $200,000 in the aggregate of other Loans that do not comply with the Credit and Collections Policy, (b) the Company may maintain its existing investments in its Subsidiaries as of the Closing Date, (c) the Company may hold Indebtedness consisting of intercompany loans and advances made by Company to its Subsidiary, provided that (A) each such Subsidiary shall have executed and delivered to the Company, on the Closing Date, a demand note (collectively, the “Intercompany Notes”) to evidence any such intercompany Indebtedness owing at any time by such Subsidiary to the Company which Intercompany Notes shall be in form and substance satisfactory to the Purchasers and shall be pledged and delivered to the Purchasers pursuant to the applicable Pledge Agreement or Security Agreement as additional collateral security for the Obligations; (B) the Company shall record all intercompany transactions on its books and records in a manner satisfactory to the Purchasers; (C) at the time any such intercompany loan or advance is made by the Company to any Subsidiary thereof and after giving effect thereto, the Company shall be Solvent; (E) no Default or Event of Default would occur and be continuing after giving effect to any such proposed intercompany loan; and (F) the aggregate amount of such intercompany Indebtedness shall not exceed $8,000,000 at any one time outstanding, (d) so long as no Default or Event of Default shall have occurred and be continuing, the Company may make investments up to $250,000 in the aggregate, subject to Control Letters in favor of the Purchasers or otherwise subject to a perfected security interest in favor of the Purchasers, in (i) marketable direct obligations issued or unconditionally guaranteed by the United States of America or any agency thereof maturing within one year from the date of acquisition thereof, (ii) commercial paper maturing no more than one year from the date of creation thereof and currently having the highest rating obtainable from either Standard & Poor’s Corporation or Xxxxx’x Investors Service, Inc., (iii) certificates of deposit, maturing no more than one year from the date of creation thereof, issued by commercial banks incorporated under the laws of the United States of America, each having combined capital, surplus and undivided profits of not less than $300,000,000 and having a senior secured rating of “A” or better by a nationally recognized rating agency (an “A Rated Bank”), (iv) time deposits, maturing no more than 30 days from the date of creation thereof with A Rated Banks, (f) subject to Section 3.2, the Company may purchase Loans from Participating Lenders that are compliant with the Credit and Collections Policy, and (e) to any SPE in connection with any Securitization prior to the Closing Date and in connection with any Securitizations consummated after the Closing Date to the extent the Company complies with its obligations under Sections 6.14 and 12.17.

Investments or Loans. Except as otherwise expressly permitted by this Section 7.4, neither Neither the Company Borrower nor any of its -------------------- Subsidiaries shall make or permit to exist investments or loans in or to any investment in, or make, accrue or permit to exist loans or advances of money to, any other Person, through the direct or indirect lending of money, holding of securities or otherwise, except that (a) investments in short-term direct obligations of the Company and its Subsidiaries may make Loans that comply with the Credit and Collection Policy and Requirements of Law and up to $200,000 in the aggregate of other Loans that do not comply with the Credit and Collections PolicyUnited States Government, (b) the Company may maintain its existing investments in its Subsidiaries as negotiable certificates of deposit issued by any Lender or by any other bank satisfactory to the Agent, payable to the order of the Closing DateBorrower or to bearer, (c) the Company may hold Indebtedness consisting of intercompany loans and advances made by Company to its Subsidiary, provided that (A) each such Subsidiary shall have executed and delivered to the Company, on the Closing Date, a demand note (collectively, the “Intercompany Notes”) to evidence any such intercompany Indebtedness owing at any time by such Subsidiary to the Company which Intercompany Notes shall be investments in form and substance satisfactory to the Purchasers and shall be pledged and delivered to the Purchasers pursuant to the applicable Pledge Agreement commercial paper rated A1 or Security Agreement as additional collateral security for the Obligations; (B) the Company shall record all intercompany transactions on its books and records in a manner satisfactory to the Purchasers; (C) at the time any such intercompany loan or advance is made by the Company to any Subsidiary thereof and after giving effect thereto, the Company shall be Solvent; (E) no Default or Event of Default would occur and be continuing after giving effect to any such proposed intercompany loan; and (F) the aggregate amount of such intercompany Indebtedness shall not exceed $8,000,000 at any one time outstandingP1, (d) so long as no loans to and investments in Affiliates which in the aggregate shall not exceed the Affiliates Investments Limit, reduced by the aggregate amount, if any, paid by the Borrower on or with respect to any guaranty referred to in clause (b) of Section 8.5 (but only to the extent that ---------- ----------- such guaranty payments by the Borrower have not been reimbursed, and provided, -------- that any such loans and investments will be made solely to permit the acquisition of assets which will inure to the benefit of the Borrower and provided further, that during the continuance of a Default or an Event of Default shall have occurred and be continuingDefault, the Company Borrower shall not increase the principal balance of, or make any new loan to or investment in, any Affiliate, but the balance due under the existing loans may make investments up to $250,000 in increase as the aggregate, subject to Control Letters in favor result of the Purchasers or otherwise subject to a perfected security accrual of interest in favor of and similar charges and the Purchasers, in (i) marketable direct obligations issued or unconditionally guaranteed by the United States of America or any agency thereof maturing within one year from the date of acquisition thereof, (ii) commercial paper maturing no more than one year from the date of creation thereof and currently having the highest rating obtainable from either Standard & Poor’s Corporation or Xxxxx’x Investors Service, Inc., (iii) certificates of deposit, maturing no more than one year from the date of creation thereof, issued by commercial banks incorporated under the laws of the United States of America, each having combined capital, surplus and undivided profits of not less than $300,000,000 and having a senior secured rating of “A” or better by a nationally recognized rating agency (an “A Rated Bank”Borrower may renew such loans), (ive) loans by the Borrower to Subsidiaries that are wholly owned by the Borrower, in an aggregate amount outstanding at any time depositsnot exceeding Ten Million Dollars ($10,000,000.00), maturing no more than 30 days from provided that such loans are for the date purpose of creation thereof with A Rated Banks, providing working capital to any such Subsidiary for its use in the ordinary course of business and (f) subject investments in the equity securities of any Person, other than a wholly-owned Subsidiary, having an aggregate fair market value (measured on the date each such investment was made and without giving effect to Section 3.2subsequent changes in value), the Company may purchase Loans from Participating Lenders when taken together with all other such investments or loans made pursuant to this clause (f) that are compliant with at the Credit and Collections Policytime outstanding, and not to exceed One Million Dollars (e) to any SPE in connection with any Securitization prior to the Closing Date and in connection with any Securitizations consummated after the Closing Date to the extent the Company complies with its obligations under Sections 6.14 and 12.17$1,000,000.00).

Investments or Loans. Except as otherwise expressly permitted by this Section 7.4Borrower shall not, neither the Company nor and Borrower shall not permit any of its Subsidiaries shall to, make or permit to exist investments or loans in or to any investment in, or make, accrue or permit to exist loans or advances of money to, any other Person, through except (i) investments in short-term direct obligations of the direct U.S. government, (ii) investments in negotiable certificates of deposit issued by any Lender or indirect lending an affiliate of moneya Lender or by any other bank satisfactory to Agent, holding in its reasonable discretion, and payable to the order of securities Borrower or otherwiseto bearer and delivered to Agent, except (iii) investments in commercial paper rated A1 or P1, (iv) advances and reimbursements for travel, entertainment and other reasonable and customary out-of-pocket expenses to Borrower's or its Subsidiaries' officers, directors or employees incurred in the ordinary course of Borrower's or its Subsidiaries' business, (v) investments of Borrower in P&J and Webco Tube as of the date hereof, (vi) obligations due from P&J to Borrower representing amounts due to Borrower for goods sold or services rendered in the ordinary course of business of Borrower on terms not materially less favorable to Borrower than Borrower would obtain in an arms-length transaction, provided that (a) any such obligation is paid in full within thirty (30) days of the Company transaction giving rise thereto, and its Subsidiaries may make Loans that comply with the Credit and Collection Policy and Requirements of Law and up to $200,000 in the aggregate of other Loans that do not comply with the Credit and Collections Policy, (b) the Company may maintain its existing investments in its Subsidiaries as of the Closing Date, (c) the Company may hold Indebtedness consisting of intercompany loans and advances made by Company to its Subsidiary, provided that (A) each such Subsidiary shall have executed and delivered to the Company, on the Closing Date, a demand note (collectively, the “Intercompany Notes”) to evidence any all such intercompany Indebtedness owing obligations due from P&J to Borrower do not at any time by such Subsidiary to the Company which Intercompany Notes shall be in form and substance satisfactory to the Purchasers and shall be pledged and delivered to the Purchasers pursuant to the applicable Pledge Agreement or Security Agreement as additional collateral security for the Obligations; (B) the Company shall record all intercompany transactions on its books and records in a manner satisfactory to the Purchasers; (C) at the time any such intercompany loan or advance is made by the Company to any Subsidiary thereof and after giving effect thereto, the Company shall be Solvent; (E) no Default or Event of Default would occur and be continuing after giving effect to any such proposed intercompany loan; and (F) the aggregate amount of such intercompany Indebtedness shall not exceed $8,000,000 at any one time outstanding, (d) so long as no Default or Event of Default shall have occurred and be continuing, the Company may make investments up to $250,000 2,000,000 in the aggregate, subject (vii) advances and loans from P&J or Webco Tube to Control Letters in favor of the Purchasers or otherwise subject to a perfected security interest in favor of the Purchasers, in (i) marketable direct obligations issued or unconditionally guaranteed by the United States of America or any agency thereof maturing within one year from the date of acquisition thereofBorrower, (iiviii) commercial paper maturing no more than one year from Accounts arising in the date ordinary course of creation thereof business of Borrower (provided that Borrower shall not permit the aggregate outstanding amount of accounts receivable from, and currently having the highest rating obtainable from either Standard & Poor’s Corporation or Xxxxx’x Investors Service, Inc., (iii) certificates of deposit, maturing no more than one year from the date of creation thereof, issued by commercial banks incorporated under the laws of the United States of America, each having combined capital, surplus investments in and undivided profits of not less than advances to Quik Water to at any time exceed $300,000,000 and having a senior secured rating of “A” or better by a nationally recognized rating agency (an “A Rated Bank”15,000), (ivix) time deposits, maturing no more than 30 days from loans outstanding on the date hereof from Borrower to officers of creation thereof with A Rated Banks, (f) subject to Section 3.2, the Company may purchase Loans from Participating Lenders that are compliant with the Credit and Collections PolicyBorrower as described on Schedule 8.9, and (ex) at any time and from time to any SPE in connection with any Securitization prior to the Closing Date and in connection with any Securitizations consummated time after the Closing Date to occurrence of the extent Deregistration, so long as each of the Company complies with Second Tier Conditions have been satisfied as determined by Agent in its obligations under Sections 6.14 and 12.17discretion, the New Officer Loans; provided that the aggregate principal amount of all New Officer Loans does not exceed $2,000,000.

Investments or Loans. Except as otherwise expressly permitted by this Section 7.4The Borrower shall not make, neither the Company nor any of its Subsidiaries shall make incur, assume or permit to exist any investment inloans or advances, or make, accrue any investments in or permit to exist loans or advances of money to, any other Person, through the direct or indirect lending of money, holding of securities or otherwise, except that (ai) the Company and its Subsidiaries may make Loans that comply with the Credit and Collection Policy and Requirements of Law and up to $200,000 in the aggregate of other Loans that do not comply with the Credit and Collections Policy, (b) the Company may maintain its existing investments in its Subsidiaries as short-term direct obligations of the Closing DateUnited States Government, agency or instrumentality thereof; or any (cii) investments in negotiable certificates of deposit issued by the Company may hold Indebtedness consisting of intercompany loans and advances made Lender or by Company to its Subsidiary, provided that (A) each such Subsidiary shall have executed and delivered to the Company, on the Closing Date, a demand note (collectively, the “Intercompany Notes”) to evidence any such intercompany Indebtedness owing at any time by such Subsidiary to the Company which Intercompany Notes shall be in form and substance other bank reasonably satisfactory to the Purchasers and shall be pledged and delivered Lender, payable to the Purchasers pursuant order of the Borrower or to the applicable Pledge Agreement or Security Agreement as additional collateral security for the Obligations; (B) the Company shall record all intercompany transactions on its books and records in a manner satisfactory to the Purchasers; (C) at the time any such intercompany loan or advance is made by the Company to any Subsidiary thereof and after giving effect thereto, the Company shall be Solvent; (E) no Default or Event of Default would occur and be continuing after giving effect to any such proposed intercompany loan; and (F) the aggregate amount of such intercompany Indebtedness shall not exceed $8,000,000 at any one time outstandingbearer, (diii) so long as no Default or Event of Default shall have occurred and be continuing, the Company may make investments up to $250,000 in the aggregate, subject to Control Letters in favor of the Purchasers or otherwise subject to a perfected security interest in favor of the Purchasers, in (i) marketable direct obligations issued or unconditionally guaranteed by the United States of America or any agency thereof maturing within one year from the date of acquisition thereof, (ii) commercial paper maturing no more than one year from the date of creation thereof and currently having the highest rating obtainable from either rated at least A-1 by Standard & Poor’s Corporation or Xxxxx’x P-1 by Mxxxx’x Investors Service, Inc., (iii) certificates of deposit, maturing no more than one year from the date of creation thereof, issued by commercial banks incorporated under the laws of the United States of America, each having combined capital, surplus and undivided profits of not less than $300,000,000 and having a senior secured or carrying an equivalent rating of “A” or better by a nationally recognized rating agency (an “A Rated Bank”)if both of the two named rating agencies cease publishing ratings of investments, (iv) time depositsinvestments in money market funds which invest substantially all their assets in securities of the types described in clauses (i) through (iii), maturing no more than 30 days from above; provided that, in each case, such investment is reasonably acceptable to the Lender, (iv) other short-term investments as may be permitted by Lender, (vi) loans or advances made by any Borrower to Parent or any other Borrower, (vii) loans and advances to employees permitted under Section 9.8; (viii) the Trust Loan and (ix) investments by the Borrowers in their respective Subsidiaries existing on the date of creation thereof with A Rated Bankshereof and additional investments by the Borrower in their respective Subsidiaries so long as such Subsidiary is a Borrower under this Agreement. Lender acknowledges that under the Option Agreement by and between Mxxxxx Memorial Convalescing and Crippled Children’s Home, (fInc.(“Mxxxxx Memorial”) subject and Advocat Inc., Borrower has made and may continue to Section 3.2, the Company may purchase Loans make from Participating Lenders that are compliant with the Credit and Collections Policy, and (e) time to any SPE time certain advances in connection with the Rxxx Xxxxxxxx Acquisition; provided that (a) the aggregate principal amount of such advances shall not exceed Eight Hundred Fifty Thousand Dollars ($850,000.00) and (b) any Securitization such advance in excess of Eight Hundred Fifty Thousand Dollars ($850,000.00) shall require Lender’s prior to the Closing Date and in connection with any Securitizations consummated after the Closing Date to the extent the Company complies with its obligations under Sections 6.14 and 12.17written consent.