Common use of Limitation on Priority Debt Clause in Contracts

Limitation on Priority Debt. (a) The Issuer shall not permit any Issuer Restricted Subsidiary that is a Domestic Restricted Subsidiary but is not a Guarantor and an Offering Proceeds Note Guarantor to, directly or indirectly, Incur any Debt; provided, however, that any Issuer Restricted Subsidiary that is a Domestic Restricted Subsidiary of the Issuer but is not a Guarantor and an Offering Proceeds Note Guarantor may Incur any Debt if, after giving pro forma effect to such Incurrence and the receipt and application of the net proceeds thereof, no Default or Event of Default would occur as a consequence of such Incurrence or be continuing following such Incurrence and the aggregate amount of Priority Debt would not exceed the Priority Debt Cap. (b) Notwithstanding the foregoing limitation, an Issuer Restricted Subsidiary that is a Domestic Restricted Subsidiary but is not a Guarantor and an Offering Proceeds Note Guarantor may Incur any and all of the following (each of which shall be given independent effect), if it would be permitted to Incur such Debt pursuant to the following provisions of Section 908 without being or becoming a Guarantor: (i) without duplication, Debt permitted to be Incurred pursuant to clauses (i), (ii), (iii), (iv), (v) (but only to the extent not incurred in anticipation of such Person becoming an Issuer Restricted Subsidiary or such merger or consolidation), (vii), (viii), (ix)(2), (x) and (xi) of paragraph (b) under Section 908; and (ii) without duplication, Debt permitted to be Incurred pursuant to clause (vi) of paragraph (b) under Section 908, but limited, in the case of refinancing Debt of clause (v) of paragraph (b) under Section 908, to Debt not incurred in anticipation of such Person becoming an Issuer Restricted Subsidiary or such merger or consolidation. (c) Notwithstanding any other provision of this Section 909, (A) the maximum amount of Debt the Domestic Restricted Subsidiaries of the Issuer may Incur pursuant to this Section 909 shall not be deemed to be exceeded due solely to the result of fluctuations in the exchange rates of currencies and (B) accrual of interest, accretion or amortization of original issue discount, the payment of interest on any Debt in the form of additional Debt with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall not be deemed to be an incurrence of Debt for purposes of this covenant. (d) For purposes of determining any particular amount of Debt under this Section 909, (1) Guarantees, Liens or obligations with respect to letters of credit supporting Debt otherwise included in the determination of such particular amount shall not be included and (2) any Liens granted for the benefit of the Securities pursuant to the provisions of Section 910 shall not be treated as Debt. In the event that an item of Debt meets the criteria of more than one of the types of Debt described in the above clauses, the Issuer, in its sole discretion, may divide and classify (and may later reclassify) such item of Debt and only be required to include the amount and type of such Debt in one of such clauses. When classifying multiple Incurrences of Debt on the same day, the Issuer may, in its sole discretion, specify the order of Incurrence of such Debt and need only give pro forma effect to the specified Incurrence (and any prior Incurrence) for purposes of classifying such specified Incurrence. (e) Notwithstanding anything to the contrary herein, the provisions of this Section 909 shall continue to apply after Section 908 has been terminated in accordance with Section 914.

Limitation on Priority Debt. (a) The Issuer shall may not permit any Issuer Restricted Subsidiary that is a Domestic Restricted Subsidiary but is not a Guarantor and an Offering a Loan Proceeds Note Guarantor to, directly or indirectly, Incur any Debt; provided, however, that any Issuer Restricted Subsidiary that is a Domestic Restricted Subsidiary of the Issuer but is not a Guarantor and an Offering a Loan Proceeds Note Guarantor may Incur any Debt if, after giving pro forma effect to such Incurrence and the receipt and application of the net proceeds thereof, no Default or Event of Default would occur as a consequence of such Incurrence or be continuing following such Incurrence and the aggregate amount of Priority Debt would not exceed the Priority Debt Cap. (b) Notwithstanding the foregoing limitation, an Issuer Restricted Subsidiary that is a Domestic Restricted Subsidiary but is not a Guarantor and an Offering a Loan Proceeds Note Guarantor may Incur any and all of the following (each of which shall be given independent effect), if it would be permitted to Incur such Debt pursuant to the following provisions of Section 908 without being or becoming a Guarantor: (i) without duplication, Debt permitted to be Incurred pursuant to clauses (i), (ii), (iii), (iv), (v) (but only to the extent not incurred in anticipation of such Person becoming an Issuer Restricted Subsidiary or such merger or consolidation), (vii), (viii), (ix)(2), (x) and (xi) of paragraph (b) under Section 908; and908(b); (ii) without duplication, Debt permitted to be Incurred pursuant to clause (vi) of paragraph (b) under Section 908908(b)(vi), but limited, in the case of refinancing Debt of clause (v) of paragraph (b) under Section 908908(b)(v), to Debt not incurred in anticipation of such Person becoming an Issuer Restricted Subsidiary or such merger or consolidation; and (iii) without duplication, following a Collateral Release Ratings Event, any Finance Lease Obligation incurred in accordance with this Indenture and then outstanding in effect on the date of such Collateral Release Ratings Event and any Finance Lease Obligation incurred in respect thereof that would satisfy the requirements of a “refinancing” pursuant to Section 908(b)(vi). (c) Notwithstanding any other provision of this Section 909, (A) the maximum amount of Debt the Domestic Restricted Subsidiaries of the Issuer may Incur pursuant to this Section 909 shall not be deemed to be exceeded due solely to the result of fluctuations in the exchange rates of currencies and (B) accrual of interest, accretion or amortization of original issue discount, the payment of interest on any Debt in the form of additional Debt with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall not be deemed to be an incurrence of Debt for purposes of this covenant. (d) For purposes of determining any particular amount of Debt under this Section 909, (1) Guarantees, Liens or obligations with respect to letters of credit supporting Debt otherwise included in the determination of such particular amount shall not be included and (2) any Liens granted for the benefit of the Securities pursuant to the provisions of Section Sections 910 or 911 shall not be treated as Debt. In the event that an item of Debt meets the criteria of more than one of the types of Debt described in the above clauses, the Issuer, in its sole discretion, may divide and classify (and may later reclassify) such item of Debt and only be required to include the amount and type of such Debt in one of such clauses. When classifying multiple Incurrences of Debt on the same day, the Issuer may, in its sole discretion, specify the order of Incurrence of such Debt and need only give pro forma effect to the specified Incurrence (and any prior Incurrence) for purposes of classifying such specified Incurrence. (e) Notwithstanding anything to the contrary herein, the provisions of this Section 909 shall continue to apply after Section 908 has been terminated in accordance with Section 914917.

Limitation on Priority Debt. (a) The Issuer shall may not, and may not permit any Issuer Restricted Subsidiary that is a Domestic Restricted Subsidiary but is not a Guarantor and an Offering Proceeds Note Guarantor to, to directly or indirectly, Incur any Priority Debt; provided, however, that the Issuer or any Issuer Restricted Subsidiary that is a Domestic Restricted Subsidiary of the Issuer but is not a Guarantor and an Offering Proceeds Note Guarantor may Incur any Priority Debt if, after giving pro forma effect to the Incurrence of such Incurrence Priority Debt and the receipt and application of the net proceeds thereof, no Default or Event of Default would occur as a consequence of such Incurrence or be continuing following such Incurrence and the aggregate amount of Priority Debt Leverage Ratio would not exceed the Priority Debt Capbe less than or equal to 3.25 to 1.00. (b) Notwithstanding the foregoing limitation, an the Issuer and any Restricted Subsidiary that is a Domestic Restricted Subsidiary but is not a Guarantor and an Offering Proceeds Note Guarantor may Incur any and all of the following Priority Debt (each of which shall be given independent effect), if it would be permitted to Incur such Debt pursuant to the following provisions of Section 908 without being or becoming a Guarantor:): (i) without duplicationPriority Debt of the Issuer or any Restricted Subsidiary under Credit Facilities (and any Permitted Refinancing Debt) in respect thereof in an aggregate principal amount outstanding at any one time not to exceed $10,250,000,000 (plus any increase in the amount thereof in connection with any refinancing, Debt permitted to be Incurred pursuant to clauses (i), (ii), (iii), (iv), (v) (but only renewal or extension thereof to the extent not incurred in anticipation such increase is permitted by the definition of such Person becoming an Issuer Restricted Subsidiary or such merger or consolidation“Permitted Refinancing Debt”), (vii), (viii), (ix)(2), (x) and (xi) of paragraph (b) under Section 908; and; (ii) without duplicationPriority Debt, including Capitalized Lease Obligations (other than Priority Debt permitted under the Existing Issuer Credit Facility and the Notes and related Notes Guarantees) existing or committed on the Issue Date and any Permitted Refinancing Debt incurred to be Incurred Refinance such Priority Debt; (iii) Priority Debt in respect of the Notes issued on the Issue Date and any Note Guarantee in respect thereof, as well as any Permitted Refinancing Debt in respect thereof; (iv) Priority Debt of the Issuer or any Restricted Subsidiary pursuant to Hedging Agreements entered into for non-speculative purposes; (v) Priority Debt owed to (including obligations in respect of letters of credit or bank guarantees or similar instruments for the benefit of) any Person providing workers’ compensation, health, disability or other employee benefits or property, casualty or liability insurance to the Issuer or any Restricted Subsidiary, pursuant to reimbursement or indemnification obligations to such Person, in each case in the ordinary course of business or consistent with past practice or industry practices; (vi) subject to Section 911, Priority Debt of the Issuer to any Restricted Subsidiary or of any Restricted Subsidiary to the Issuer or any other Restricted Subsidiary; provided, that Priority Debt owed by the Issuer or any Guarantor to any Restricted Subsidiary that is not a Guarantor and Priority Debt of any Guarantor owing to the Issuer incurred pursuant to this clause (vi) shall be subordinated in right of paragraph payment to the Note Obligations on customary terms (bas determined in good faith by the Issuer); (vii) under Section 908Priority Debt in respect of performance bonds, but limitedbid bonds, appeal bonds, surety bonds and completion guarantees and similar obligations, in each case provided in the ordinary course of business or consistent with past practice or industry practices, including those incurred to secure health, safety and environmental obligations in the ordinary course of business or consistent with past practice or industry practices; (viii) Priority Debt arising from the honoring by a bank or other financial institution of a check, draft or similar instrument drawn against insufficient funds in the ordinary course of business or other cash management services, in each case incurred in the ordinary course of refinancing business; (x) Priority Debt of clause (v) of paragraph (b) under Section 908, to Debt not incurred in anticipation of such Person becoming an Issuer a Restricted Subsidiary acquired after the Issue Date or such merger a Person merged or consolidation. (c) Notwithstanding any other provision of this Section 909, (A) the maximum amount of Debt the Domestic Restricted Subsidiaries of consolidated with the Issuer may Incur or any Restricted Subsidiary after the Issue Date and Priority Debt otherwise assumed by the Issuer or any Restricted Subsidiary in connection with the acquisition of assets or Equity Interests, where such acquisition, merger, amalgamation or consolidation is not prohibited by this Indenture; provided, that, Priority Debt acquired or assumed pursuant to this Section 909 clause (ix)(x) shall be in existence prior to the respective merger, amalgamation or consolidation or acquisition of assets or Equity Interests and shall not be deemed to be exceeded due solely to the result of fluctuations have been created in the exchange rates of currencies contemplation thereof or in connection therewith and (B) accrual of interest, accretion or amortization of original issue discount, the payment of interest on any Debt in the form of additional Debt with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall not be deemed to be an incurrence of Debt for purposes of this covenant. (d) For purposes of determining any particular amount of Debt under this Section 909, (1) Guarantees, Liens or obligations with respect to letters of credit supporting Debt otherwise included in the determination of such particular amount shall not be included and (2y) any Liens granted for the benefit of the Securities pursuant Permitted Refinancing Debt incurred to the provisions of Section 910 shall not be treated as Refinance any such Priority Debt. In the event that an item of Debt meets the criteria of more than one of the types of Debt described in the above clauses, the Issuer, in its sole discretion, may divide and classify (and may later reclassify) such item of Debt and only be required to include the amount and type of such Debt in one of such clauses. When classifying multiple Incurrences of Debt on the same day, the Issuer may, in its sole discretion, specify the order of Incurrence of such Debt and need only give pro forma effect to the specified Incurrence (and any prior Incurrence) for purposes of classifying such specified Incurrence. (e) Notwithstanding anything to the contrary herein, the provisions of this Section 909 shall continue to apply after Section 908 has been terminated in accordance with Section 914.;

Limitation on Priority Debt. (a) The Issuer shall may not permit any Issuer Restricted Subsidiary that is a Domestic Restricted Subsidiary but is not a Guarantor and an Offering a Loan Proceeds Note Guarantor to, directly or indirectly, Incur any Debt; provided, however, that any Issuer Restricted Subsidiary that is a Domestic Restricted Subsidiary of the Issuer but is not a Guarantor and an Offering a Loan Proceeds Note Guarantor may Incur any Debt if, after giving pro forma effect to such Incurrence and the receipt and application of the net proceeds thereof, no Default or Event of Default would occur as a consequence of such Incurrence or be continuing following such Incurrence and the aggregate amount of Priority Debt would not exceed the Priority Debt Cap. (b) Notwithstanding the foregoing limitation, an Issuer Restricted Subsidiary that is a Domestic Restricted Subsidiary but is not a Guarantor and an Offering a Loan Proceeds Note Guarantor may Incur any and all of the following (each of which shall be given independent effect), if it would be permitted to Incur such Debt pursuant to the following provisions of Section 908 without being or becoming a Guarantor: (i) without duplication, Debt permitted to be Incurred pursuant to clauses (i), (ii), (iii), (iv), (v) (but only to the extent not incurred in anticipation of such Person becoming an Issuer Restricted Subsidiary or such merger or consolidation), (vii), (viii), (ix)(2), (x) and (xi) of paragraph (b) under Section 908; and908(b); (ii) without duplication, Debt permitted to be Incurred pursuant to clause (vi) of paragraph (b) under Section 908908(b)(vi), but limited, in the case of refinancing Debt of clause (v) of paragraph (b) under Section 908908(b)(v), to Debt not incurred in anticipation of such Person becoming an Issuer Restricted Subsidiary or such merger or consolidation; and (iii) without duplication, following a Collateral Release Ratings Event, any Finance Lease Obligation incurred in accordance with this Indenture and then outstanding in effect on the date of such Collateral Release Ratings Event and any Finance Lease Obligation incurred in respect thereof that would satisfy the requirements of a “refinancing” pursuant to Section 908(b)(vi). (c) Notwithstanding any other provision of this Section 909, (A) the maximum amount of Debt the Domestic Restricted Subsidiaries of the Issuer may Incur pursuant to this Section 909 shall not be deemed to be exceeded due solely to the result of fluctuations in the exchange rates of currencies and (B) accrual of interest, accretion or amortization of original issue discount, the payment of interest on any Debt in the form of additional Debt with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall not be deemed to be an incurrence of Debt for purposes of this covenant. (d) For purposes of determining any particular amount of Debt under this Section 909, (1) Guarantees, Liens or obligations with respect to letters of credit supporting Debt otherwise included in the determination of such particular amount shall not be included and (2) any Liens granted for the benefit of the Securities pursuant to the provisions of Section referred to in Sections 910 or 911 shall not be treated as Debt. In the event that an item of Debt meets the criteria of more than one of the types of Debt described in the above clauses, the Issuer, in its sole discretion, may divide and classify (and may later reclassify) such item of Debt and only be required to include the amount and type of such Debt in one of such clauses. When classifying multiple Incurrences of Debt on the same day, the Issuer may, in its sole discretion, specify the order of Incurrence of such Debt and need only give pro forma effect to the specified Incurrence (and any prior Incurrence) for purposes of classifying such specified Incurrence. (e) Notwithstanding anything to the contrary herein, the provisions of this Section 909 shall continue to apply after Section 908 has been terminated in accordance with Section 914917.

Limitation on Priority Debt. The Company will not permit any Subsidiary to create, assume, incur, guarantee or otherwise become liable in respect of any Indebtedness except: (a) The Issuer Indebtedness of Omega Pharma S.A. (France) and Omega Pharma Holding (Nederland) B.V. not to exceed (i) €72,000,000 in the aggregate (or its equivalent in other currencies) prior to the 2004 Facility Trigger Date, and (ii) at any time on or after the 2004 Facility Trigger Date, such amount as when added to the principal amount of Indebtedness permitted under Section 10.6(i) below, shall not permit in the aggregate exceed 20% of Consolidated Net Worth; provided that Indebtedness allowed under this clause (a) shall be in addition to any Issuer Restricted Indebtedness either such Subsidiary that is shall be allowed under Section 10.6(d); (b) Indebtedness owed by a Domestic Restricted Subsidiary but is not a to the Company or any other Subsidiary; (c) Indebtedness of any Approved Subsidiary Guarantor; (d) Indebtedness of any Subsidiary Guarantor and an Offering Proceeds Note Guarantor to, directly or indirectly, Incur arising under any Debt; provided, however, that any Issuer Restricted Subsidiary that is a Domestic Restricted Subsidiary guarantee of Indebtedness of the Issuer but is Company; (e) Indebtedness outstanding at the time such Person became a Subsidiary provided that such Indebtedness shall not a Guarantor and an Offering Proceeds Note Guarantor may Incur any Debt if, after giving pro forma effect to such Incurrence and the receipt and application of the net proceeds thereof, no Default or Event of Default would occur as a consequence have been incurred in contemplation of such Incurrence person becoming a Subsidiary and further provided that this clause (e) shall cease to be applicable to any Indebtedness that remains outstanding more than 365 days after such Person becomes a Subsidiary; (f) any Indebtedness for or be continuing following such Incurrence and in respect of receivables sold or discounted (otherwise than on a non-recourse basis) provided that the aggregate amount of Priority Debt would such Indebtedness does not at any time exceed the Priority Debt Cap.€15,000,000 (or its equivalent in other currencies); (bg) Notwithstanding Indebtedness of Subsidiaries secured by a Lien permitted by Sections 10.7(a) through (f); (h) Indebtedness owing under cash management pooling arrangements among the foregoing limitation, an Issuer Restricted Subsidiary that is a Domestic Restricted Subsidiary but is not a Guarantor Company and an Offering Proceeds Note Guarantor may Incur its Subsidiaries entered into by the Company and any and all of its Subsidiaries in the following (each ordinary course of which shall be given independent effect), if it would be permitted to Incur such Debt pursuant to the following provisions of Section 908 without being or becoming a Guarantor:its banking arrangements; and (i) without duplicationIndebtedness of Subsidiaries not otherwise permitted by foregoing clauses (a) through (h), Debt provided that (A) prior to the 2004 Facility Trigger Date, the aggregate principal amount of all Indebtedness of Subsidiaries permitted to be Incurred pursuant to clauses under this clause (i) shall not at any time exceed €40,000,000 (or its equivalent in other currencies), and (B) at any time on or after the 2004 Facility Trigger Date, the principal amount of all Indebtedness of Subsidiaries permitted under this clause (i), (ii), (iii), (iv), (v) (but only when added to the extent not incurred in anticipation principal amount of such Person becoming an Issuer Restricted Subsidiary or such merger or consolidation), (vii), (viii), (ix)(2), (x) and (xi) of paragraph (b) Indebtedness permitted under Section 908; and (ii10.6(a) without duplicationabove, Debt permitted to be Incurred pursuant to clause (vi) of paragraph (b) under Section 908, but limited, shall not in the case aggregate exceed 20% of refinancing Debt of clause (v) of paragraph (b) under Section 908, to Debt not incurred in anticipation of such Person becoming an Issuer Restricted Subsidiary or such merger or consolidationConsolidated Net Worth. (c) Notwithstanding any other provision of this Section 909, (A) the maximum amount of Debt the Domestic Restricted Subsidiaries of the Issuer may Incur pursuant to this Section 909 shall not be deemed to be exceeded due solely to the result of fluctuations in the exchange rates of currencies and (B) accrual of interest, accretion or amortization of original issue discount, the payment of interest on any Debt in the form of additional Debt with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall not be deemed to be an incurrence of Debt for purposes of this covenant. (d) For purposes of determining any particular amount of Debt under this Section 909, (1) Guarantees, Liens or obligations with respect to letters of credit supporting Debt otherwise included in the determination of such particular amount shall not be included and (2) any Liens granted for the benefit of the Securities pursuant to the provisions of Section 910 shall not be treated as Debt. In the event that an item of Debt meets the criteria of more than one of the types of Debt described in the above clauses, the Issuer, in its sole discretion, may divide and classify (and may later reclassify) such item of Debt and only be required to include the amount and type of such Debt in one of such clauses. When classifying multiple Incurrences of Debt on the same day, the Issuer may, in its sole discretion, specify the order of Incurrence of such Debt and need only give pro forma effect to the specified Incurrence (and any prior Incurrence) for purposes of classifying such specified Incurrence. (e) Notwithstanding anything to the contrary herein, the provisions of this Section 909 shall continue to apply after Section 908 has been terminated in accordance with Section 914.

Limitation on Priority Debt. (a) The Issuer shall may not permit any Issuer Restricted Subsidiary that is a Domestic Restricted Subsidiary but is not a Guarantor and an Offering Proceeds Note Guarantor to, directly or indirectly, Incur any Debt; provided, however, that any Issuer Restricted Subsidiary that is a Domestic Restricted Subsidiary of the Issuer but is not a Guarantor and an Offering Proceeds Note Guarantor may Incur any Debt if, after giving pro forma effect to such Incurrence and the receipt and application of the net proceeds thereof, no Default or Event of Default would occur as a consequence of such Incurrence or be continuing following such Incurrence and the aggregate amount of Priority Debt would not exceed the Priority Debt Cap. (b) Notwithstanding the foregoing limitation, an Issuer Restricted Subsidiary that is a Domestic Restricted Subsidiary but is not a Guarantor and an Offering Proceeds Note Guarantor may Incur any and all of the following (each of which shall be given independent effect), if it would be permitted to Incur such Debt pursuant to the following provisions of Section 908 without being or becoming a Guarantor: (i) without duplication, Debt permitted to be Incurred pursuant to clauses (i), (ii), (iii), (iv), (v) (but only to the extent not incurred in anticipation of such Person becoming an Issuer Restricted Subsidiary or such merger or consolidation), (vii), (viii), (ix)(2), (x) and (xi) of paragraph (b) under Section 908; and (ii) without duplication, Debt permitted to be Incurred pursuant to clause (vi) of paragraph (b) under Section 908, but limited, in the case of refinancing Debt of clause (v) of paragraph (b) under Section 908, to Debt not incurred in anticipation of such Person becoming an Issuer Restricted Subsidiary or such merger or consolidation. (c) Notwithstanding any other provision of this Section 909, (A) the maximum amount of Debt the Domestic Restricted Subsidiaries of the Issuer may Incur pursuant to this Section 909 shall not be deemed to be exceeded due solely to the result of fluctuations in the exchange rates of currencies and (B) accrual of interest, accretion or amortization of original issue discount, the payment of interest on any Debt in the form of additional Debt with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall not be deemed to be an incurrence of Debt for purposes of this covenant. (d) For purposes of determining any particular amount of Debt under this Section 909, (1) Guarantees, Liens or obligations with respect to letters of credit supporting Debt otherwise included in the determination of such particular amount shall not be included and (2) any Liens granted for the benefit of the Securities pursuant to the provisions of Section 910 shall not be treated as Debt. In the event that an item of Debt meets the criteria of more than one of the types of Debt described in the above clauses, the Issuer, in its sole discretion, may divide and classify (and may later reclassify) such item of Debt and only be required to include the amount and type of such Debt in one of such clauses. When classifying multiple Incurrences of Debt on the same day, the Issuer may, in its sole discretion, specify the order of Incurrence of such Debt and need only give pro forma effect to the specified Incurrence (and any prior Incurrence) for purposes of classifying such specified Incurrence. (e) Notwithstanding anything to the contrary herein, the provisions of this Section 909 shall continue to apply after Section 908 has been terminated in accordance with Section 914.