Common use of Limitation on Subsidiary Debt Clause in Contracts

Limitation on Subsidiary Debt. The Borrower will not permit any Subsidiary or any CSX Conrail Subsidiary to create, incur or assume any Debt (other than Debt substantially secured by a Lien or Liens on assets of such Subsidiary or such CSX Conrail Subsidiary permitted under Section 6.02) after the Closing Date, except: (a) extensions, renewals and replacements of any Debt existing on the date hereof that do not increase the outstanding principal amount thereof (other than to finance payments made in connection therewith); (b) Debt of any Subsidiary or CSX Conrail Subsidiary to the Borrower or any other Subsidiary or CSX Conrail Subsidiary; (c) Debt of any Person that becomes a Subsidiary after the date hereof; provided that such Debt exists at the time such Person becomes a Subsidiary and is not created in contemplation of or in connection with such Person becoming a Subsidiary; (d) Debt of any Subsidiary or CSX Conrail Subsidiary as an account party in respect of letters of credit; and (e) other Debt; provided that (i) at the time of the creation, incurrence or assumption of such Debt and after giving effect thereto, the aggregate principal amount of all such Debt of the Subsidiaries does not exceed an amount equal to 10% of Total Capitalization at such time and (ii) any Allocable CSX/NS Debt of the CSX/NS Acquisition Sub Entities incurred after the Closing Date shall, without duplication, be treated as “Debt” of a Subsidiary for purposes of clause (i) of this proviso.

Limitation on Subsidiary Debt. The Borrower will not permit any Subsidiary or any CSX Conrail Subsidiary of its Subsidiaries to create, incur or assume at any time be liable with respect to any Debt (other than Debt substantially secured by a Lien or Liens on assets of such Subsidiary or such CSX Conrail Subsidiary permitted under Section 6.02) after the Closing Date, except: (a) extensions, renewals and replacements of any Debt existing on under the date hereof that do not increase the outstanding principal amount thereof (other than to finance payments made in connection therewith)Loan Documents; (b) the Existing Debt of such Subsidiary outstanding on the Closing Date; and (except in the case of the Existing ARCO Chemical Debt described in clause (i) of the definition of such term, which if refinanced with other Debt may be refinanced only with Debt of the Borrower) refinancings thereof provided that the principal amount thereof is not increased beyond the amount outstanding thereunder on the date hereof and the amount of any refinancing costs; (c) Debt secured by Liens permitted by Section 5.09; (d) intercompany Debt of an Obligor owing to an Obligor, or of any Subsidiary or CSX Conrail Subsidiary which is not an Obligor owing to the Borrower or any other Subsidiary or CSX Conrail Subsidiary; (ce) Debt of any Person that becomes a Subsidiary after Guarantor consisting of a Guarantee of a Debt Incurrence by the date hereof; provided that such Debt exists at the time such Person becomes a Subsidiary and is not created in contemplation of or in connection with such Person becoming a SubsidiaryBorrower; (df) Debt of any Subsidiary or CSX Conrail Subsidiary as Foreign Subsidiaries in an account party in respect of letters of creditaggregate outstanding principal amount at no time exceeding $300,000,000; and (eg) other Debt; provided that (i) at the time of the creation, incurrence or assumption of such Debt and after giving effect thereto, the aggregate principal amount of all such Debt of the Subsidiaries does not exceed an amount equal to 10% of Total Capitalization at such time and (ii) any Allocable CSX/NS Debt of the CSX/NS Acquisition Sub Entities otherwise permitted by this Section incurred after the Closing Date shall, without duplication, be treated as “Debt” in an aggregate principal amount at any time outstanding not to exceed (x) $50,000,000 less (y) the aggregate outstanding principal amount of a Subsidiary for purposes of Debt secured by Liens permitted solely by clause (ij) of this provisoSection 5.09 at such time; provided that, notwithstanding the foregoing, the Borrower will not permit any JV Subsidiary to incur or at any time be liable with respect to any Debt, other than obligations of such JV Subsidiary in respect of the Borrower Joint Venture in which it holds an equity interest and arising by reason of such JV Subsidiary's ownership of such equity interest.

Limitation on Subsidiary Debt. The Borrower will not ----------------------------- permit any Subsidiary or any CSX Conrail Subsidiary to create, incur or assume any Debt (other than Debt substantially secured by a Lien or Liens on assets of such Subsidiary or such CSX Conrail Subsidiary permitted under Section 6.02) after the Closing Date, except: (a) extensions, renewals and replacements of any Debt existing on the date hereof that do not increase the outstanding principal amount thereof (other than to finance payments made in connection therewith); (b) Debt of any Subsidiary or CSX Conrail Subsidiary to the Borrower or any other Subsidiary or CSX Conrail Subsidiary; (c) Debt of any Person that becomes a Subsidiary after the date hereof; provided that such Debt exists at the time such Person becomes a -------- Subsidiary and is not created in contemplation of or in connection with such Person becoming a Subsidiary; (d) Debt of any Subsidiary or CSX Conrail Subsidiary as an account party in respect of letters of credit; and (e) other Debt; provided that (i) at the time of the creation, -------- incurrence or assumption of such Debt and after giving effect thereto, the aggregate principal amount of all such Debt of the Subsidiaries does not exceed an amount equal to 10% of Total Capitalization at such time and (ii) any Allocable CSX/NS Debt of the CSX/NS Acquisition Sub Entities incurred after the Closing Date shall, without duplication, be treated as “"Debt” " of a Subsidiary for purposes of clause (i) of this proviso.

Limitation on Subsidiary Debt. The Borrower will not permit any Subsidiary or any CSX Conrail Subsidiary to create, incur or assume any Debt (other than Debt substantially secured by a Lien or Liens on assets of such Subsidiary or such CSX Conrail Subsidiary permitted under Section 6.02) after the Closing Date, except: (a) extensions, renewals and replacements of any Debt existing on the date hereof that do not increase the outstanding principal amount thereof (other than to finance payments made in connection therewith); (b) Debt of any Subsidiary or CSX Conrail Subsidiary to the Borrower or any other Subsidiary or CSX Conrail Subsidiary; (c) Debt of any Person that becomes a Subsidiary after the date hereof; provided that such Debt exists at the time such Person becomes a Subsidiary and is not created in contemplation of or in connection with such Person becoming a Subsidiary; (d) Debt of any Subsidiary or CSX Conrail Subsidiary as an account party in respect of letters of credit; and (e) other Debt; provided that (i) at the time of the creation, incurrence or assumption of such Debt and after giving effect thereto, the aggregate principal amount of all such Debt of the Subsidiaries does not exceed an amount equal to 1015% of Total Capitalization at such time and (ii) any Allocable CSX/NS Debt of the CSX/NS Acquisition Sub Entities incurred after the Closing Date shall, without duplication, be treated as “Debt” of a Subsidiary for purposes of clause (i) of this proviso.

Limitation on Subsidiary Debt. The Borrower will not permit any Subsidiary or any CSX Conrail Subsidiary of its Subsidiaries to create, incur or assume at any time be liable with respect to any Debt (other than Debt substantially secured by a Lien or Liens on assets of such Subsidiary or such CSX Conrail Subsidiary permitted under Section 6.02) after the Closing Date, except: (a) extensions, renewals and replacements of any Debt existing on the date hereof that do not increase the outstanding principal amount thereof (other than to finance payments made in connection therewith); (bi) Debt of any Subsidiary or CSX Conrail Subsidiary owing to the Borrower or any a Subsidiary all of the outstanding common stock of which (other Subsidiary than directors' qualifying shares) is owned directly or CSX Conrail Subsidiaryindirectly by the Borrower; (cii) Debt of Subsidiaries not otherwise permitted by this Section in an aggregate principal amount at any time outstanding not exceeding $500,000,000; (iii) Guarantees by any Subsidiary of Debt of its own Subsidiaries, provided that the Guaranteed Debt is permitted under this Section; (iv) Debt of any Person that becomes a Subsidiary after the date hereof; provided that such Debt exists at the time such Person becomes a Subsidiary and is not created incurred in contemplation of or such event; (v) Debt of a Subsidiary in existence on the Effective Date and extensions, renewals and refinancings thereof; (vi) Debt of a Subsidiary incurred in connection with such Person becoming a Subsidiary; (d) Debt the financing of any asset, but solely to the extent that under the terms of such Debt the obligations of such Subsidiary or CSX Conrail Subsidiary as an account party in with respect of letters of creditto such Debt may be satisfied by recourse only to such asset and the proceeds thereof; and (evii) other DebtDebt of Subsidiaries incurred or assumed (in connection with an equipment trust agreement, conditional sale agreement, chattel mortgage or lease or otherwise) for the purpose of directly or indirectly financing all or any part of the cost of acquiring, constructing or rebuilding any asset and any renewal, extension or refinancing thereof; provided that (i) at the time of the creation, incurrence or assumption of such Debt and after giving effect thereto, the aggregate principal amount of all such Debt (other than extensions, renewals and refinancings) incurred or assumed in any fiscal year of the Subsidiaries does Borrower pursuant to this clause (vii) shall not exceed an amount equal to 10% of Total Capitalization at such time and (ii) any Allocable CSX/NS Debt of the CSX/NS Acquisition Sub Entities incurred after the Closing Date shall, without duplication, be treated as “Debt” of a Subsidiary for purposes of clause (i) of this proviso$500,000,000.

Limitation on Subsidiary Debt. The Borrower will not permit any Subsidiary or any CSX Conrail Subsidiary to create, incur or assume any Debt (other than Debt substantially secured by a Lien or Liens on assets of such Subsidiary or such CSX Conrail Subsidiary permitted under Section 6.02) after the Closing Date, except: (a) extensions, renewals and replacements of any Debt existing on the date hereof that do not increase the outstanding principal amount thereof (other than to finance payments made in connection therewith); (b) Debt of any Subsidiary or CSX Conrail Subsidiary to the Borrower or any other Subsidiary or CSX Conrail Subsidiary; (c) Debt of any Person that becomes a Subsidiary after the date hereof; provided that such Debt exists at the time such Person becomes a Subsidiary and is not created in contemplation of or in connection with such Person becoming a Subsidiary; (d) Debt of any Subsidiary or CSX Conrail Subsidiary as an account party in respect of letters of credit; and (e) other Debt; provided that (i) at the time of the creation, incurrence or assumption of such Debt and after giving effect thereto, the aggregate principal amount of all such Debt of the Subsidiaries does not exceed an amount equal to 10% of Total Capitalization at such time and (ii) any Allocable CSX/NS Debt of the CSX/NS Acquisition Sub Entities incurred after the Closing Date shall, without duplication, be treated as “"Debt” " of a Subsidiary for purposes of clause (i) of this proviso.

Limitation on Subsidiary Debt. The Borrower Except during any Suspension Period, Solera will not permit any Subsidiary of its Subsidiaries (other than the Issuer or any CSX Conrail parent company of the Issuer or any Excluded Subsidiary for so long as it constitutes an Excluded Subsidiary) to create, incur assume, incur, Guarantee or assume otherwise become liable for or suffer to exist any Debt Indebtedness (any Indebtedness of a Subsidiary of Solera (other than the Issuer or any parent company of the Issuer), “Subsidiary Debt”), without Guaranteeing the payment of the principal of, premium, if any, and interest on the Notes on an unsecured unsubordinated basis. The foregoing restriction shall not apply to, and there shall be excluded from Indebtedness in any computation under such restriction, Subsidiary Debt substantially secured by constituting: (1) Indebtedness of a Lien Person existing at the time it is merged, combined or Liens on assets of amalgamated with or into or consolidated with or into any such Subsidiary or such CSX Conrail Subsidiary permitted under Section 6.02) after the Closing Date, except: (a) extensions, renewals and replacements of any Debt existing on the date hereof that do not increase the outstanding principal amount thereof (other than to finance payments made in connection therewith); (b) Debt of any Subsidiary or CSX Conrail Subsidiary to the Borrower or any other Subsidiary or CSX Conrail Subsidiary; (c) Debt of any Person that becomes a Subsidiary after the date hereof; provided that such Debt exists at the time such Person becomes a Subsidiary and is not created in contemplation of or in connection with such Person becoming a Subsidiary; (d) Debt of any Subsidiary or CSX Conrail Subsidiary as an account party in respect of letters of credit; and (e) other Debt; provided that (i) at the time of a sale, lease or other disposition of the creation, incurrence or assumption properties and assets of such Debt Person (or a division thereof) as an entirety or substantially as an entirety to any such Subsidiary and after giving effect theretois assumed by such Subsidiary; provided that any Indebtedness was not incurred in contemplation thereof and is not Guaranteed by any other such Subsidiary (other than any Guarantee existing at the time of such merger, the aggregate principal amount consolidation or sale, lease or other disposition of all such Debt of the Subsidiaries does properties and assets and that was not exceed an amount equal to 10% of Total Capitalization at such time and (ii) any Allocable CSX/NS Debt of the CSX/NS Acquisition Sub Entities incurred after the Closing Date shall, without duplication, be treated as “Debt” of a Subsidiary for purposes of clause (i) of this proviso.issued in contemplation thereof);

Limitation on Subsidiary Debt. (a) The Borrower will Company shall not permit any Subsidiary or any CSX Conrail Subsidiary of its Restricted Subsidiaries that is not a Guarantor to create, incur assume, incur, issue or assume guarantee any Debt Indebtedness (other than Debt substantially secured by any such Indebtedness of a Lien or Liens on assets non-guarantor Subsidiary, “Non-Guarantor Subsidiary Debt”), unless such Restricted Subsidiary guarantees the payment of such Subsidiary or such CSX Conrail Subsidiary permitted under Section 6.02) after the Closing Dateprincipal of, except: (a) extensionspremium, renewals if any, and replacements of any Debt existing interest on the date hereof that do not increase the outstanding principal amount thereof (other than to finance payments made in connection therewith);Notes on an unsecured unsubordinated basis. (b) The provisions of Section 4.07(a) hereof shall not apply to Non-Guarantor Subsidiary Debt constituting: (1) Indebtedness of any Subsidiary a Person existing at the time such Person is merged into or CSX Conrail Subsidiary to consolidated with the Borrower Company or any Restricted Subsidiary of the Company or at the time of a sale, lease or other disposition of the properties and assets of such Person (or a division thereof) as an entirety or substantially as an entirety to any Restricted Subsidiary or CSX Conrail Subsidiary; (c) Debt of the Company that is assumed by any Person that becomes a Restricted Subsidiary after of the date hereofCompany; provided that such Debt exists Indebtedness was not incurred in contemplation thereof; (2) Indebtedness of a Person existing at the time such Person becomes a Restricted Subsidiary of the Company; provided that such Indebtedness was not incurred in contemplation thereof; (3) Indebtedness owed to the Company or any of its Restricted Subsidiaries; (4) Indebtedness of any Restricted Subsidiary of the Company secured by Mortgages on assets of such Restricted Subsidiary permitted under any of clauses (1), (2), (3), (4), (5), (7), (8) and (9) of Section 4.06(b); (i) Indebtedness outstanding on the Issue Date (other than any Indebtedness under the Existing Senior Notes, the Credit Facilities or Indebtedness of any Foreign Subsidiary or Foreign Holding Company) or (ii) any extension, renewal, replacement or refunding of any Indebtedness existing on the Issue Date or referred to in clause (1), (2), (3) or (4) of this Section 4.07(b) above ((x) in each case, other than any Indebtedness under the Existing Senior Notes or the Credit Facilities and (y) in the case of clause (1), (3) or (4) of this Section 4.07(b), other than any Indebtedness of any Foreign Subsidiary or Foreign Holding Company, the refinancing of which may not be incurred or Guaranteed pursuant to this Section 4.07(b)(5) by any Restricted Subsidiary that is not created in contemplation a Guarantor of or the Notes); provided that the principal amount of the Indebtedness incurred pursuant to this Section 4.07(b)(5) shall not exceed the principal amount of the original Indebtedness plus all premiums, fees and expenses (including accrued interest) payable in connection with any such Person becoming a Subsidiaryextension, renewal, replacement or refunding; (d6) Debt of any Subsidiary or CSX Conrail Subsidiary as an account party in respect of letters of creditIndebtedness under the Credit Facilities; and (e7) other Debtany Indebtedness of any Foreign Subsidiary or Foreign Holding Company; provided that (i) at the time of the creation, incurrence or assumption of such Debt and after giving effect thereto, the aggregate principal amount of Indebtedness incurred under this Section 4.07(b)(7), when aggregated with the principal amount of all other Indebtedness then outstanding and incurred pursuant to this Section 4.07(b)(7), does not, as of any date of incurrence, exceed the greater of (a) $175.0 million or (b) 7.0% of the Consolidated Net Tangible Assets of the Company as of the date on which any such Indebtedness is incurred. (c) Notwithstanding the restrictions described in this Section 4.07, the Company and any of its Restricted Subsidiaries may create, incur, issue, assume or guarantee Non-Guarantor Subsidiary Debt, without adhering to the requirements of Section 4.07(a), if at the time of such creation, incurrence, issuance, assumption or guarantee, after giving effect thereto and to the retirement of any Indebtedness that is concurrently being retired, the aggregate amount of all such Non-Guarantor Subsidiary Debt that would otherwise be subject to the restrictions in Section 4.07(a) (other than Non-Guarantor Subsidiary Debt described in clauses (1) through (7) of Section 4.07(b)); plus the aggregate amount (without duplication) of (x) all Indebtedness secured by Mortgages (not including any such Indebtedness secured by Mortgages described in clauses (1) through (10) of Section 4.06(b)), and (y) all Attributable Debt of the Company and any of its Restricted Subsidiaries in respect of Sale and Lease-Back Transactions (with the exception of any such transactions that are permitted under clauses (1) and (2) of Section 4.08) does not exceed an amount equal to 1015% of Total Capitalization at such time and (ii) any Allocable CSX/NS Debt the Consolidated Net Tangible Assets of the CSX/NS Acquisition Sub Entities incurred after Company as of the Closing Date shall, without duplication, be treated as “Debt” of a Subsidiary for purposes of clause (i) of this provisodate on which any such Indebtedness is incurred.

Limitation on Subsidiary Debt. The Borrower will not not, at any time, permit any Subsidiary to, directly or any CSX Conrail Subsidiary to indirectly, create, incur incur, assume, guarantee, have outstanding, or assume otherwise become or remain directly or indirectly liable with respect to any Debt (other than Debt substantially secured by a Lien or Liens on assets of such Subsidiary or such CSX Conrail Subsidiary permitted under Section 6.02) after the Closing Date, exceptthan: (ai) extensionsDebt of a Subsidiary outstanding on December 31, renewals 2005 described on Schedule 8.1(i) and replacements of any Debt existing on extension, renewal or refunding thereof, provided that (A) the date hereof that do not increase the outstanding principal amount thereof (other than to finance payments made is not increased in connection therewith)with such extension, renewal or refunding and (B) no Default or Event of Default shall exist at the time of such extension, renewal or refunding; (bii) Debt of any a Subsidiary or CSX Conrail Subsidiary owed to the Borrower or any other Subsidiary or CSX Conrail a Wholly-Owned Subsidiary; (ciii) Debt of any Person that becomes a Subsidiary after the date hereof; provided that such Debt exists outstanding at the time such Person Subsidiary becomes a Subsidiary, provided that (A) such Debt shall not have been incurred in contemplation of such Subsidiary becoming a Subsidiary and (B) immediately after such Subsidiary becomes a Subsidiary no Default or Event of Default shall exist, and any extension, renewal or refunding of such Debt, provided, that (x) the principal amount thereof is not created in contemplation of or increased in connection with such Person becoming a Subsidiary; extension, renewal or refunding and (dy) Debt no Default or Event of any Subsidiary Default shall exist at the time of such extension, renewal or CSX Conrail Subsidiary as an account party in respect of letters of creditrefunding; and (eiv) other DebtDebt of a Subsidiary in addition to that otherwise permitted by the provisions of this Section 9.2(c); provided that (i) at on the time of the creation, incurrence date such Subsidiary incurs or assumption of otherwise becomes liable with respect to any such additional Debt and immediately after giving effect theretothereto and to the concurrent retirement of any other Debt (A) no Default or Event of Default shall exist, the aggregate principal amount of all and (B) such Debt of can be incurred within the Subsidiaries does not exceed an amount equal to 10% of Total Capitalization at such time applicable limitations provided in Sections 9.2(b) and (ii) any Allocable CSX/NS Debt of the CSX/NS Acquisition Sub Entities incurred after the Closing Date shall, without duplication, be treated as “Debt” of a Subsidiary for purposes of clause (i) of this proviso9.2(d).

Limitation on Subsidiary Debt. The Borrower will AES shall not permit any Subsidiary of AES to, incur, assume, create or suffer to exist any CSX Conrail Subsidiary to createDebt, incur or assume any Debt (other than Debt substantially secured by a Lien or Liens on assets of such Subsidiary or such CSX Conrail Subsidiary permitted under Section 6.02) after the Closing Date, exceptexcept for: (a) extensions, renewals and replacements Guarantees of any Debt existing on of AES under the date hereof that do not increase the outstanding principal amount thereof (other than to finance payments made in connection therewith)Financing Documents; (b) Debt incurred by a Subsidiary: (i) to finance the development, acquisition, construction, operation, maintenance or working capital requirements (including letters of any Subsidiary credit or CSX Conrail Subsidiary guarantees to fund debt service reserve accounts or similar accounts) of a Power Project or other business operated or managed (including on a joint basis with others), directly or indirectly, by AES (an "AES BUSINESS"), and (ii) that is not also the Borrower or Debt of any other Subsidiary with an interest in any other AES Business (except for Debt incurred or CSX Conrail Subsidiaryassumed by Intermediate Holding Companies (as defined in Section 5.16(b) below) (other than Specified Subsidiaries) which, at the time such Debt was incurred or assumed, in the aggregate, contributed less than 50% of the Parent Operating Cash Flow (other than Parent Operating Cash Flow attributable to Specified Subsidiaries) for the immediately preceding four fiscal quarters); (c) Debt of any Person that becomes a Subsidiary after existing on the date hereof; provided that such Debt exists at the time such Person becomes a Subsidiary and is not created in contemplation of or in connection with such Person becoming a Subsidiary; (d) Debt owing to AES or a Consolidated Subsidiary of any Subsidiary or CSX Conrail Subsidiary as an account party in respect of letters of credit; andAES; (e) other DebtDebt representing a refinancing, replacement or refunding of Debt permitted by clauses (b) and (c) above; provided that PROVIDED that: (i) at the time of the creation, incurrence or assumption of such Debt and after giving effect thereto, the aggregate principal amount of all such Debt of the Subsidiaries does outstanding or available will not exceed an the principal amount equal outstanding or available at the time of such refinancing, replacement or refunding (plus fees and expenses, including any premium and defeasance costs) relating to 10% such refinancing, replacement or refunding, UNLESS in the case of Total Capitalization at such time and (ii) any Allocable CSX/NS Debt refinancing, replacing or refunding Debt of the CSX/NS Acquisition Sub Entities incurred after the Closing Date shall, without duplication, be treated as “Debt” of a any Subsidiary for purposes of permitted by clause (ib) of this proviso.above:

Limitation on Subsidiary Debt. The Borrower Guarantor will not permit any Subsidiary or any CSX Conrail Subsidiary of its Subsidiaries to create, incur or assume at any time be liable with respect to any Debt (other than Debt substantially secured by a Lien or Liens on assets of such Subsidiary or such CSX Conrail Subsidiary permitted under Section 6.02) after the Closing Date, except: (ai) extensions, renewals and replacements Debt owing to Guarantor or a Subsidiary all of any Debt existing on the date hereof that do not increase the outstanding principal amount thereof common stock of which (other than to finance payments made in connection therewith)directors’ qualifying shares) is owned directly or indirectly by Guarantor; (bii) Debt of Subsidiaries not otherwise permitted by this Section 9(e) in an aggregate principal amount at any Subsidiary or CSX Conrail Subsidiary to the Borrower or any other Subsidiary or CSX Conrail Subsidiarytime outstanding not exceeding $1,250,000,000; (ciii) Guarantees by any Subsidiary of Debt of its own Subsidiaries, (iv) Debt of any Person that becomes a Subsidiary after the date hereof; provided that such Debt exists at the time such Person becomes a Subsidiary and is not created incurred in contemplation of or such event; (v) Debt of a Subsidiary in existence on the Document Closing Date and extensions, renewals and refinancings thereof, provided that the principal amount of such Debt is not increased except by an amount no greater than the Permitted Additional Amount; (vi) Debt of a Subsidiary incurred in connection with the financing of any asset, but solely to the extent that under the terms of such Person becoming a SubsidiaryDebt the obligations of such Subsidiary with respect to such Debt may be satisfied by recourse only to such asset and the proceeds and replacements thereof; (dvii) Debt obligations (contingent or otherwise) of any Subsidiary arising under any swap contract or CSX Conrail Subsidiary as an account party hedge agreement; provided that such obligations are (or were) entered into in respect the ordinary course of letters business for the purpose of creditdirectly mitigating risks associated with liabilities, commitments, investments, assets or property held or reasonably anticipated by such Person, and not for purposes of speculation; (viii) Debt arising from the endorsement of instruments in the ordinary course of business; (ix) Debt arising from the honoring by a bank or other financial institution of a check, draft or similar instrument inadvertently (except in the case of daylight overdrafts) drawn against insufficient funds in the ordinary course of business; and (ex) other DebtDebt of Subsidiaries incurred or assumed (in connection with an equipment trust agreement, conditional sale agreement, chattel mortgage or lease or otherwise) for the purpose of directly or indirectly financing all or any part of the cost of acquiring, constructing or rebuilding any asset and any renewal, extension or refinancing thereof; provided that (i) at the time of the creation, incurrence or assumption of such Debt and after giving effect thereto, the aggregate principal amount of all such Debt (other than extensions, renewals and refinancings that do not increase the principal amount thereof except by an amount no greater than the Permitted Additional Amount) incurred or assumed in any fiscal year of the Subsidiaries does Guarantor pursuant to this clause (x) shall not exceed an amount equal to 10% of Total Capitalization at such time and (ii) any Allocable CSX/NS Debt of the CSX/NS Acquisition Sub Entities incurred after the Closing Date shall, without duplication, be treated as “Debt” of a Subsidiary for purposes of clause (i) of this proviso$750,000,000.

Limitation on Subsidiary Debt. The Borrower will not not, at any time, permit any Subsidiary to, directly or any CSX Conrail Subsidiary to indirectly, create, incur incur, assume, guarantee, have outstanding, or assume otherwise become or remain directly or indirectly liable with respect to any Debt (other than Debt substantially secured by a Lien or Liens on assets of such Subsidiary or such CSX Conrail Subsidiary permitted under Section 6.02) after the Closing Date, exceptthan: (ai) extensionsDebt of a Subsidiary outstanding on December 31, renewals 2003 described on Schedule 8.1(i) and replacements of any Debt existing on extension, renewal or refunding thereof, provided that (A) the date hereof that do not increase the outstanding principal amount thereof (other than to finance payments made is not increased in connection therewith)with such extension, renewal or refunding and (B) no Default or Event of Default shall exist at the time of such extension, renewal or refunding; (bii) Debt of any a Subsidiary or CSX Conrail Subsidiary owed to the Borrower or any other Subsidiary or CSX Conrail a Wholly-Owned Subsidiary; (ciii) Debt of any Person that becomes a Subsidiary after the date hereof; provided that such Debt exists outstanding at the time such Person Subsidiary becomes a Subsidiary, provided that (A) such Debt shall not have been incurred in contemplation of such Subsidiary becoming a Subsidiary and (B) immediately after such Subsidiary becomes a Subsidiary no Default or Event of Default shall exist, and any extension, renewal or refunding of such Debt, provided, that (x) the principal amount thereof is not created in contemplation of or increased in connection with such Person becoming a Subsidiary; extension, renewal or refunding and (dy) Debt no Default or Event of any Subsidiary Default shall exist at the time of such extension, renewal or CSX Conrail Subsidiary as an account party in respect of letters of creditrefunding; and (eiv) other DebtDebt of a Subsidiary in addition to that otherwise permitted by the provisions of this Section 9.2(c); provided that (i) at on the time of the creation, incurrence date such Subsidiary incurs or assumption of otherwise becomes liable with respect to any such additional Debt and immediately after giving effect theretothereto and to the concurrent retirement of any other Debt (A) no Default or Event of Default shall exist, the aggregate principal amount of all and (B) such Debt of can be incurred within the Subsidiaries does not exceed an amount equal to 10% of Total Capitalization at such time applicable limitations provided in Sections 9.2(b) and (ii) any Allocable CSX/NS Debt of the CSX/NS Acquisition Sub Entities incurred after the Closing Date shall, without duplication, be treated as “Debt” of a Subsidiary for purposes of clause (i) of this proviso9.2(d).

Limitation on Subsidiary Debt. The Borrower Company will not not, at any time, permit any Subsidiary to, directly or any CSX Conrail Subsidiary to indirectly, create, incur incur, assume, guarantee, have outstanding, or assume otherwise become or remain directly or indirectly liable with respect to any Debt (other than Debt substantially secured by a Lien or Liens on assets of such Subsidiary or such CSX Conrail Subsidiary permitted under Section 6.02) after the Closing Date, exceptthan: (a) extensions, renewals and replacements Debt of any Debt existing a Subsidiary outstanding on the date hereof of this Agreement described on Schedule 5.15 and any extension, renewal or refunding thereof, provided that do not increase (1) the outstanding principal amount thereof (other than to finance payments made is not increased in connection therewith)with such extension, renewal or refunding and (2) no Default or Event of Default shall exist at the time of such extension, renewal or refunding; (b) Debt of any a Subsidiary or CSX Conrail Subsidiary owed to the Borrower Company or any other Subsidiary or CSX Conrail a Wholly-Owned Subsidiary; (c) Debt of any Person that becomes a Subsidiary after the date hereof; provided that such Debt exists outstanding at the time such Person Subsidiary becomes a Subsidiary, provided that (1) such Debt shall not have been incurred in contemplation of such Subsidiary becoming a Subsidiary and (2) immediately after such Subsidiary becomes a Subsidiary no Default or Event of Default shall exist, and any extension, renewal or refunding of such Debt, provided, that (i) the principal amount thereof is not created in contemplation of or increased in connection with such Person becoming a Subsidiary;extension, renewal or refunding and (ii) no Default or Event of Default shall exist at the time of such extension, renewal or refunding; and (d) Debt of any a Subsidiary or CSX Conrail Subsidiary as an account party in respect addition to that otherwise permitted by the provisions of letters of credit; and (e) other Debtthis Section 10.3; provided that (i) at on the time of the creation, incurrence date such Subsidiary incurs or assumption of otherwise becomes liable with respect to any such additional Debt and immediately after giving effect theretothereto and to the concurrent retirement of any other Debt (1) no Default or Event of Default shall exist, the aggregate principal amount of all and (2) such Debt of can be incurred within the Subsidiaries does not exceed an amount equal to 10% of Total Capitalization at such time applicable limitations provided in Sections 10.2 and (ii) any Allocable CSX/NS Debt of the CSX/NS Acquisition Sub Entities incurred after the Closing Date shall, without duplication, be treated as “Debt” of a Subsidiary for purposes of clause (i) of this proviso10.4.

Limitation on Subsidiary Debt. The Borrower will not permit any Subsidiary or any CSX Conrail Subsidiary to create, incur or assume any Debt (other than Debt substantially secured by a Lien or Liens on assets of such Subsidiary or such CSX Conrail Subsidiary permitted under Section 6.026.03) after the Closing Effective Date (or, in the case of any CSX Conrail Subsidiary, after the Control Date), except: (a) extensions, renewals and replacements of any Debt existing on the date hereof (or, in the case of any CSX/NS Acquisition Sub Entity, existing on the Control Date) that do not increase the outstanding principal amount thereof (other than to finance payments made in connection therewith); (b) Debt of any Subsidiary or CSX Conrail Subsidiary to the Borrower or any other Subsidiary or CSX Conrail Subsidiary; (c) Debt of any Person that becomes a Subsidiary after the date hereof; provided that such Debt exists at the time such Person becomes a Subsidiary and is not created in contemplation of or in connection with such Person becoming a Subsidiary; (d) Debt of any Subsidiary or CSX Conrail Subsidiary as an account party in respect of letters of credit; and (e) other Debt; provided that (i) at the time of the creation, incurrence or assumption of such Debt and after giving effect thereto, the aggregate principal amount of all such Debt of the Subsidiaries does not exceed an amount equal to 10% of Total Capitalization at such time and (ii) any Allocable CSX/NS Debt of the CSX/NS Acquisition Sub Entities incurred after the Closing Effective Date (or, in the case of Conrail and its subsidiaries, incurred after the Control Date) shall, without duplication, be treated as “"Debt” " of a Subsidiary for purposes of clause (i) of this proviso.