Mergers, Consolidations, Sales of Assets and Acquisitions. Merge into or consolidate with any other person, or permit any other person to merge into or consolidate with it, or Dispose of (in one transaction or in a series of related transactions) all or any part of its assets (whether now owned or hereafter acquired), effect any Delaware LLC Division or Dispose of any Equity Interests of any Subsidiary, or purchase, lease or otherwise acquire (in one transaction or a series of related transactions) all of the assets of any other person or division or line of business of a person, except that this Section 6.05 shall not prohibit: (a) (i) the purchase, discount or Disposition of equipment, inventory, accounts receivable, notes receivable or other assets, in each case in the ordinary course of business or consistent with past practice or industry norm by the Borrower or any Subsidiary or the conversion of accounts receivable to notes receivable, (ii) the acquisition or lease (pursuant to an operating lease) of any other asset in the ordinary course of business or consistent with past practice or industry norm by the Borrower or any Subsidiary or, with respect to operating leases, otherwise for fair market value on market terms (as determined in good faith by the Borrower), (iii) the Disposition of surplus, obsolete, damaged or worn out equipment or other property by the Borrower or any Subsidiary in the ordinary course of business or consistent with past practice or industry norm or determined in good faith by the Borrower to be no longer used or useful or necessary in the operation of the business of the Borrower or any Subsidiary, (iv) [reserved], (v) the Disposition of Permitted Investments in the ordinary course of business or (vi) the Disposition of property or equipment or the abandonment of Intellectual Property rights that is otherwise economically impracticable to maintain; (b) if at the time thereof and immediately after giving effect thereto no Event of Default shall have occurred and be continuing or would result therefrom, (i) the liquidation, dissolution, merger or consolidation of any Subsidiary with or into the Borrower in a transaction in which the Borrower is the survivor or the requirements of Section 6.05(o) are otherwise complied with, (ii) the merger or consolidation of any Subsidiary (other than the Borrower) with or into the Borrower or any other Subsidiary in a transaction in which the surviving or resulting entity is or becomes the Borrower or a Subsidiary and, in the case of each of clauses (i) and (ii), no person other than the Borrower, the Borrower or a Subsidiary receives any consideration (unless otherwise permitted by Section 6.04), (iii) the liquidation, dissolution or merger or consolidation of any Subsidiary (other than the Borrower) with or into the Borrower or any other Subsidiary, (iv) the change in form of entity of the Borrower or any Subsidiary if the Borrower determines in good faith that such change in form is advisable or in the best interests of the Borrower and is not materially disadvantageous to the Lenders, (v) any Subsidiary (other than the Borrower) may merge or consolidate with any other person in order to effect an Investment permitted pursuant to Section 6.04 so long as the continuing or surviving person shall be the Borrower or a Subsidiary (unless otherwise permitted by Section 6.04), and which together with each of its Subsidiaries shall have complied with any applicable requirements of Section 5.10 or (vi) any Subsidiary (other than the Borrower) may merge or consolidate with any other person in order to effect an Asset Sale otherwise permitted pursuant to this Section 6.05; (c) Dispositions to the Borrower or a Subsidiary (upon voluntary liquidation or otherwise); provided, that following any such Disposition of all or substantially all of the assets of the Borrower, the Borrower is the surviving entity or the requirements of Section 6.05(o) are otherwise complied with; (d) Sale and Lease-Back Transactions permitted by Section 6.03; (e) (i) Investments permitted by Section 6.04, Permitted Liens and Restricted Payments permitted by Section 6.06 and (ii) any Disposition made in connection with the Transactions; (f) Dispositions of defaulted receivables in the ordinary course of business and not as part of an accounts receivables financing transaction; (g) other Dispositions of assets; provided, that the Net Proceeds thereof, if any, are applied in accordance with Section 2.11(b) to the extent required thereby; (h) Permitted Business Acquisitions (including any merger, consolidation or amalgamation in order to effect a Permitted Business Acquisition); provided, that following any such merger, consolidation or amalgamation involving the Borrower, the Borrower is the surviving entity or the requirements of Section 6.05(o) are otherwise complied with; (i) leases, assignments, licenses or subleases or sublicenses of any real or personal property in the ordinary course of business or consistent with past practice or industry norm; (j) Dispositions of inventory or equipment or Dispositions or abandonment of Intellectual Property of the Borrower and its Subsidiaries determined in good faith by the management of the Borrower to be no longer useful or necessary in the operation of the business of, or material to the conduct of the business of, the Borrower or any of the Subsidiaries; (k) acquisitions and purchases made with the proceeds of any Asset Sale pursuant to the first proviso of clause (a) of the definition of “Net Proceeds”; (l) the purchase and Disposition (including by capital contribution) of (i) Securitization Assets including pursuant to Permitted Securitization Financings, (ii) any other Securitization Assets subject to Liens securing Permitted Securitization Financing and (iii) receivables in connection with a receivables financing; (m) to the extent constituting a Disposition, any termination, settlement, extinguishment or unwinding of obligations in respect of any Hedging Agreement; (n) any exchange of assets for services and/or other assets used or useful in a Similar Business of comparable or greater value; provided, that (i) to the extent the consideration received consists of assets, at least 90% of the consideration received by the transferor consists of assets that will be used in a business or business activity permitted hereunder, (ii) in the event of a swap with a fair market value (as determined in good faith by the Borrower) in excess of $10,000,000, the Administrative Agent shall have received a certificate from a Responsible Officer of the Borrower with respect to such fair market value and (iii) in the event of a swap with a fair market value (as determined in good faith by the Borrower) in excess of $15,000,000, such exchange shall have been approved by at least a majority of the Board of Directors of Holdings or the Borrower; (o) if at the time thereof and immediately after giving effect thereto no Event of Default shall have occurred and be continuing or would result therefrom, the Borrower, any Subsidiary or any other person may be liquidated, dissolved, merged, amalgamated or consolidated with or into the Borrower; provided that (A) the Borrower shall be the surviving entity or (B) if the surviving entity is not the Borrower (such other person, the “Successor Borrower”), (1) the Successor Borrower shall be an entity organized or existing under the laws of the United States, any state thereof or the District of Columbia, (2) the Successor Borrower shall expressly assume all the obligations of the Borrower under this Agreement and the other Loan Documents pursuant to a supplement hereto or thereto in form reasonably satisfactory to the Administrative Agent, (3) each Guarantor, unless it is the other party to such merger or consolidation, shall have by a counterpart to this Agreement, as applicable, confirmed that its guarantee thereunder shall apply to any Successor Borrower’s obligations under this Agreement, (4) each Subsidiary Guarantor, unless it is the other party to such merger or consolidation, shall have by a supplement to any applicable Collateral Document affirmed that its obligations thereunder shall apply to its guarantee as reaffirmed pursuant to clause (3), (5) each mortgagor of a Mortgaged Property, unless it is the other party to such merger or consolidation, shall have affirmed that its obligations under the applicable Mortgage shall apply to its guarantee as reaffirmed pursuant to clause (3) and (6) the Successor Borrower shall have delivered to the Administrative Agent (x) an officer’s certificate stating that such merger or consolidation does not violate this Agreement or any other Loan Document and (y) if requested by the Administrative Agent, an opinion of counsel to the effect that such liquidation, dissolution, merger, amalgamation or consolidation does not violate this Agreement or any other Loan Document and covering such other matters as are contemplated by the Collateral and Guarantee Requirement to be covered in opinions of counsel (it being understood that if the foregoing are satisfied, the Successor Borrower will succeed to, and be substituted for, the Borrower under this Agreement); (p) Dispositions in connection with the exercise of any subscriptions, options, warrants, puts, calls or other rights or commitments pursuant to agreements set forth on Schedule 3.08(b); (q) Dispositions of property or assets (i) acquired after the Closing Date which property or assets are not used or useful to the core or principal business of the Borrower and the Subsidiaries in the good faith determination of the Borrower or (ii) that are made in connection with the approval of any applicable antitrust authority or as otherwise necessary or advisable in the good faith determination of the Borrower to consummate any Permitted Business Acquisition, New Project, Investment or other transaction; and (r) any Disposition to effect the formation of any Subsidiary that is a Delaware Divided LLC and would otherwise not be prohibited hereunder; provided that any disposition or other allocation of any assets (including any Equity Interests of such Delaware Divided LLC) in connection therewith is otherwise permitted hereunder. Notwithstanding anything to the contrary contained in Section 6.05 above, no Disposition of assets under Section 6.05(g) or, solely with respect to Sale and Lease-Back Transactions referred to in clause (b)(y) of Section 6.03, under Section 6.05(d), shall be permitted unless (i) such Disposition is for fair market value (as determined in good faith by the Borrower), or if not for fair market value, the shortfall is permitted as an Investment under Section 6.04, and (ii) at least 75% of the proceeds of such Disposition (except to Loan Parties) consist of cash or Permitted Investments; provided, that the provisions of this clause (ii) shall not apply to any individual transaction or series of related transactions involving assets with a fair market value (as determined in good faith by the Borrower) of less than $12,500,000 or to other transactions involving assets with a fair market value (as determined in good faith by the Borrower) of not more than the greater of $85,000,000 and 0.20 times the Adjusted EBITDA calculated on a Pro Forma Basis for the then most recently ended Test Period in the aggregate for all such transactions during the term of this Agreement; provided, further, that for purposes of this clause (ii), each of the following shall be deemed to be cash: (a) the amount of any liabilities (as shown on the Borrower’s or such Subsidiary’s most recent balance sheet or in the notes thereto or, if incurred or increased subsequent to the date of such balance sheet, such liabilities that would have been shown on the Borrower’s or such Subsidiary’s balance sheet or in the notes thereto if such incurrence or increase had taken place on or prior to the date of such balance sheet, as determined by the Borrower) of the Borrower or any Subsidiary that are assumed by the transferee of any such assets (or a third party in connection with such transfer) or are otherwise cancelled or terminated in connection with such transaction, (b) any notes or other obligations or other securities or assets received by the Borrower or such Subsidiary from the transferee that are converted by the Borrower or such Subsidiary into cash within 180 days after receipt thereof (to the extent of the cash received), (c) any Designated Non-Cash Consideration received by the Borrower or any of its Subsidiaries in such Disposition having an aggregate fair market value (as determined in good faith by the Borrower), taken together with all other Designated Non-Cash Consideration received pursuant to this clause (c) that is at that time outstanding, not to exceed the greater of $165,000,000 and 0.35 times the Adjusted EBITDA calculated on a Pro Forma Basis for the Test Period ended immediately prior to the receipt of such Designated Non-Cash Consideration (with the fair market value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value), (d) the amount of Indebtedness of any Subsidiary that is no longer a Subsidiary as a result of such Asset Sale, to the extent that Holdings, the Borrower and each other Subsidiary are released from any guarantee of payment of such Indebtedness in connection with the Asset Sale and (e) consideration consisting of Indebtedness of the Borrower or a Subsidiary (other than Indebtedness that is subordinated in right of payment to the Loan Obligations) received from persons who are not Holdings, the Borrower or a Subsidiary in connection with the Asset Sale and that is cancelled or otherwise extinguished. For purposes of this Agreement, the fair market value of any assets acquired, leased, exchanged, Disposed of, sold, conveyed or transferred by the Borrower or any Subsidiary shall be determined in good faith by the Borrower and may be determined either, at the option of the Borrower, at the time of such acquisition, lease, exchange, Disposition, sale, conveyance or transfer, as applicable, or as of the date of the definitive agreement with respect to such acquisition, lease, exchange, Disposition, sale, conveyance or transfer, as applicable.
Appears in 3 contracts
Samples: Credit Agreement (United Parks & Resorts Inc.), Credit Agreement (SeaWorld Entertainment, Inc.), Credit Agreement (SeaWorld Entertainment, Inc.)
Mergers, Consolidations, Sales of Assets and Acquisitions. Merge into or consolidate with any other person, or permit any other person to merge into or consolidate with it, or Dispose of (in one transaction or in a series of related transactions) all or any part of its assets (whether now owned or hereafter acquired), effect any Delaware LLC Division or Dispose of any Equity Interests of any Subsidiary, or purchase, lease or otherwise acquire (in one transaction or a series of related transactions) all of the assets of any other person or division or line of business of a person, except that this Section 6.05 shall not prohibit:
(a) (i) the purchase, discount or purchase and Disposition of equipment, inventory, accounts receivable, notes receivable or other assetsthe sale of receivables pursuant to non-recourse factoring arrangements, in each case in the ordinary course of business or and consistent with past practice or industry norm norms by the Borrower or any Subsidiary or the conversion of accounts receivable to notes receivableSubsidiary, (ii) the acquisition or lease (pursuant to an operating lease) of any other asset in the ordinary course of business or consistent with past practice or industry norm by the Borrower or any Subsidiary or, with respect to operating leases, otherwise for fair market value on market terms (as determined in good faith by the Borrower), (iii) the Disposition of surplus, obsolete, damaged or worn out equipment or other property by the Borrower or any Subsidiary in the ordinary course of business or and consistent with past practice or industry norm norms or determined in good faith by the Borrower to be no longer used or useful or necessary in the operation of the business of the Borrower or any SubsidiarySubsidiary and consistent with past practice or industry norms, (iv) [reserved]assignments by the Borrower and any Subsidiary in connection with insurance arrangements of their rights and remedies under, and with respect to, any definitive agreement related to an acquisition, Investment or Disposition in respect of any breach of its representations and warranties set forth therein or (v) the Disposition of Permitted Investments in the ordinary course of business or (vi) the Disposition of property or equipment or the abandonment of Intellectual Property rights that is otherwise economically impracticable to maintainbusiness;
(b) if at the time thereof and immediately after giving effect thereto no Event of Default shall have occurred and be continuing or would result therefrom, (i) the liquidation, dissolution, merger or consolidation of any Subsidiary with or into the Borrower in a transaction in which the Borrower is the survivor or the requirements of Section 6.05(o) are otherwise complied withsurvivor, (ii) the merger or consolidation of any Subsidiary (other than the Borrower) with or into the Borrower or any other Subsidiary in a transaction in which the surviving or resulting entity is or becomes the Borrower or a Subsidiary and, in the case of each of clauses (i) and (ii), no person other than the Borrower, the Borrower or a Subsidiary receives any consideration (unless otherwise permitted by Section 6.04)Loan Party, (iii) the liquidation, dissolution or merger or consolidation of any Subsidiary (other than the Borrower) that is not a Subsidiary Loan Party with or into the Borrower or any other Subsidiary, (iv) the liquidation or dissolution or change in form of entity of the Borrower or any Subsidiary if the Borrower determines in good faith that such liquidation, dissolution or change in form is advisable or in the best interests of the Borrower and is not materially disadvantageous to the Lenders, (v) any Subsidiary (other than the Borrower) may merge or consolidate with any other person in order to effect an Investment permitted pursuant to Section 6.04 so long as as, in the case of any Subsidiary Loan Party, the continuing or surviving person shall be the Borrower or a Subsidiary Loan Party (unless otherwise permitted by Section 6.04), ) and which together with each of its Subsidiaries shall have complied with any applicable requirements of Section 5.10 or (vi) any Subsidiary (other than the Borrower) may merge or consolidate with any other person in order to effect an Asset Sale otherwise permitted pursuant to this Section 6.05;
(c) Dispositions to the Borrower or a Subsidiary (upon voluntary liquidation or otherwise); provided, that following any such Disposition of all or substantially all of the assets of the Borrower, the Borrower Dispositions by a Loan Party to a Subsidiary that is the surviving entity or the requirements of not a Subsidiary Loan Party in reliance on this clause (c) shall be made in compliance with Section 6.05(o) are otherwise complied with6.04;
(d) Sale and Lease-Back Transactions permitted by Section 6.03;
(e) (i) Investments permitted by Section 6.04, Permitted Liens and Restricted Payments permitted by Section 6.06 and (ii) any Disposition made in connection with the Transactions6.06;
(f) Dispositions of defaulted receivables in the ordinary course of business and consistent with past practice or industry norms and not as part of an accounts receivables financing transaction;
(g) other Dispositions of assets; provided, that the Net Proceeds thereof, if any, are applied in accordance with Section 2.11(b) to the extent required thereby;
(h) Permitted Business Acquisitions (including any merger, consolidation or amalgamation in order to effect a Permitted Business Acquisition); provided, that following any such merger, consolidation or amalgamation involving the Borrower, the Borrower is the surviving entity or the requirements of Section 6.05(o) are otherwise complied with;
(i) leases, assignments, licenses or subleases or sublicenses of any real or personal property in the ordinary course of business or and consistent with past practice or industry normnorms;
(j) Dispositions of inventory or equipment or Dispositions or abandonment of Intellectual Property of the Borrower and its Subsidiaries determined in good faith by the management of the Borrower to be no longer useful or necessary in the operation of the business of, or material to the conduct of the business of, the Borrower or any of the Subsidiaries;
(k) acquisitions and purchases made with the proceeds of any Asset Sale pursuant to the first proviso of clause (a) of the definition of “Net Proceeds”;
(l) the purchase and Disposition (including by capital contribution) of (i) Securitization Assets including pursuant to Permitted Securitization Financings, Financings and (ii) any other Securitization Assets subject to Liens securing Permitted Securitization Financing and (iii) receivables in connection with a receivables financingFinancing;
(m) to the extent constituting a Disposition, any termination, settlement, settlement or extinguishment or unwinding of obligations in respect of any Hedging Agreement;
(n) any exchange of assets for services and/or other assets used or useful in a Similar Business of comparable or greater value; provided, that (i) to the extent the consideration received consists of assets, at least 90100% of the consideration received by the transferor consists of assets that will be used in a business or business activity permitted hereunder, (ii) in the event of a swap with a fair market value (as determined in good faith by the Borrower) in excess of $10,000,0001,000,000, the Administrative Agent shall have received a certificate from a Responsible Officer of the Borrower with respect to such fair market value and value, (iii) in the event of a swap with a fair market value (as determined in good faith by the Borrower) in excess of $15,000,0005,000,000, such exchange shall have been approved by at least a majority of the Board of Directors of Holdings or the BorrowerBorrower and (iv) to the extent that the assets exchanged constitute Collateral for the Term B Loans, the consideration received in respect thereof shall constitute Collateral for the Term B Loans; provided, further, that no Default or Event of Default exists or would result therefrom;
(o) if at the time thereof and immediately after giving effect thereto no Event of Default shall have occurred and be continuing or would result therefrom, the Borrower, any Subsidiary or any other person may be liquidated, dissolved, merged, amalgamated or consolidated with or into the Borrower; , provided that (A) the Borrower shall be the surviving entity or (B) if the surviving entity is not the Borrower (such other person, the “Successor Borrower”), (1) the Successor Borrower shall be an entity organized or existing under the laws of the United States, any state thereof or thereof, the District of ColumbiaColumbia or any territory thereof, (2) the Successor Borrower shall expressly assume all the obligations of the Borrower under this Agreement and the other Loan Documents pursuant to a supplement hereto or thereto in form reasonably satisfactory to the Administrative Agent, (3) each Guarantor, unless it is the other party to such merger or consolidation, shall have by a counterpart supplement to this the Holdings Guarantee and Pledge Agreement or the Subsidiary Guarantee Agreement, as applicable, confirmed that its guarantee thereunder shall apply to any Successor Borrower’s obligations under this Agreement, (4) each Subsidiary GuarantorLoan Party, unless it is the other party to such merger or consolidation, shall have by a supplement to any applicable Collateral Security Document affirmed that its obligations thereunder shall apply to its guarantee as reaffirmed pursuant to clause (3), (5) each mortgagor of a Mortgaged Property, unless it is the other party to such merger or consolidation, shall have affirmed that its obligations under the applicable Mortgage shall apply to its guarantee as reaffirmed pursuant to clause (3) and (6) the Successor Borrower shall have delivered to the Administrative Agent (x) an officer’s certificate stating that such merger or consolidation does not violate this Agreement or any other Loan Document and (y) if requested by the Administrative Agent, an opinion of counsel to the effect that such liquidation, dissolution, merger, amalgamation merger or consolidation does not violate this Agreement or any other Loan Document and covering such other matters as are contemplated by the Collateral and Guarantee Requirement to be covered in opinions of counsel (it being understood that if the foregoing are satisfied, the Successor Borrower will succeed to, and be substituted for, the Borrower under this Agreement);
(p) Dispositions in connection with the exercise of any subscriptions, options, warrants, puts, calls or other rights or commitments pursuant to agreements set forth on Schedule 3.08(b);
(q) Dispositions of property or assets (i) acquired after the Closing Date which property or assets are not used or useful to the core or principal business of the Borrower and the Subsidiaries in the good faith determination of the Borrower or (ii) that are made in connection with the approval of any applicable antitrust authority or as otherwise necessary or advisable in the good faith determination of the Borrower to consummate any Permitted Business Acquisition, New Project, Investment or other transaction; and
(rp) any Disposition to effect the formation of any Subsidiary that is a Delaware Divided LLC and would otherwise not be prohibited hereunder; provided that any disposition or other allocation of any assets (including any Equity Interests of such Delaware Divided LLC) in connection therewith is otherwise permitted hereunder; provided, further, that any Subsidiary formed as a result of a Delaware LLC Division from a Subsidiary Loan Party shall also be a Subsidiary Loan Party (unless otherwise permitted by Section 6.04). Notwithstanding anything to the contrary contained in Section 6.05 above, no Disposition of assets under Section 6.05(g) or, solely with respect to Sale and Lease-Back Transactions referred to in clause (b)(y) of Section 6.03, under Section 6.05(d), shall be permitted unless (i) such Disposition is for fair market value (as determined in good faith by the Borrower), or if not for fair market value, the shortfall is permitted as an Investment under Section 6.04, and (ii) at least 75% of the proceeds of such Disposition (except to Loan Parties) consist of cash or Permitted Investments; provided, that the provisions of this clause (ii) shall not apply to any individual transaction or series of related transactions involving assets with a fair market value (as determined in good faith by the Borrower) of less than $12,500,000 5,000,000 or to other transactions involving assets with a fair market value (as determined in good faith by the Borrower) of not more than the greater of $85,000,000 and 0.20 times the Adjusted EBITDA calculated on a Pro Forma Basis for the then most recently ended Test Period 15,000,000 in the aggregate for all such transactions during the term of this Agreement; provided, further, that for purposes of this clause (ii), each of the following shall be deemed to be cash: (a) the amount of any liabilities (as shown on the Borrower’s or such Subsidiary’s most recent balance sheet or in the notes thereto or, if incurred or increased subsequent to the date of such balance sheet, such liabilities that would have been shown on the Borrower’s or such Subsidiary’s balance sheet or in the notes thereto if such incurrence or increase had taken place on or prior to the date of such balance sheet, as determined by the Borrowerthereto) of the Borrower or any Subsidiary that are assumed by the transferee of any such assets (or a third party in connection with such transfer) or are otherwise cancelled or terminated in connection with such transaction, (b) any notes or other obligations or other securities or assets received by the Borrower or such Subsidiary from the transferee that are converted by the Borrower or such Subsidiary into cash within 180 days after receipt thereof (to the extent of the cash received), (c) any Designated Non-Cash Consideration received by the Borrower or any of its Subsidiaries in such Disposition having an aggregate fair market value (as determined in good faith by the Borrower), taken together with all other Designated Non-Cash Consideration received pursuant to this clause (c) that is at that time outstanding, not to exceed the greater of $165,000,000 and 0.35 times the Adjusted EBITDA calculated on a Pro Forma Basis for the Test Period ended immediately prior to the receipt of such Designated Non-Cash Consideration (with the fair market value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value)[reserved], (d) the amount of Indebtedness of any Subsidiary that is no longer a Subsidiary as a result of such Asset Sale, to the extent that Holdings, the Borrower and each other Subsidiary are released from any guarantee of payment of such Indebtedness in connection with the Asset Sale and (e) consideration consisting of Indebtedness of the Borrower or a Subsidiary (other than Indebtedness that is subordinated in right of payment to the Loan Obligations) received from persons who are not Holdings, the Borrower or a Subsidiary in connection with the Asset Sale and that is cancelled or otherwise extinguishedcancelled. For purposes of this AgreementSection 6.05, the fair market value of any assets acquired, leased, exchanged, Disposed of, sold, conveyed or transferred of by the Borrower or any Subsidiary shall be determined in good faith by the Borrower and may be determined either, at the option of the Borrower, at the time of such acquisition, lease, exchange, Disposition, sale, conveyance or transfer, as applicable, Disposition or as of the date of the definitive agreement with respect to such acquisition, lease, exchange, Disposition, sale, conveyance or transfer, as applicable.
Appears in 1 contract
Samples: Incremental Assumption and Amendment Agreement (Rackspace Technology, Inc.)
Mergers, Consolidations, Sales of Assets and Acquisitions. Merge into or consolidate with any other person, or permit any other person to merge into or consolidate with it, or Dispose of (in one transaction or in a series of related transactions) all or any part of its assets (whether now owned or hereafter acquired), effect any Delaware LLC Division or Dispose of any Equity Interests of any Subsidiary, or purchase, lease or otherwise acquire (in one transaction or a series of related transactions) all of the assets of any other person or division or line of business of a person, except that this Section 6.05 shall not prohibit:
(a) (i) the purchase, discount or Disposition of equipment, inventory, accounts receivable, notes receivable or other assets, in each case in the ordinary course of business or consistent with past practice or industry norm by the Borrower or any Subsidiary or the conversion of accounts receivable to notes receivable, (ii) the acquisition or lease (pursuant to an operating lease) of any other asset in the ordinary course of business or consistent with past practice or industry norm by the Borrower or any Subsidiary or, with respect to operating leases, otherwise for fair market value on market terms (as determined in good faith by the Borrower), (iii) the Disposition of surplus, obsolete, damaged or worn out equipment or other property by the Borrower or any Subsidiary in the ordinary course of business or consistent with past practice or industry norm or determined in good faith by the Borrower to be no longer used or useful or necessary in the operation of the business of the Borrower or any Subsidiary, (iv) [reserved], (v) the Disposition of Permitted Investments in the ordinary course of business or (vi) the Disposition of property or equipment or the abandonment of Intellectual Property rights that is otherwise economically impracticable to maintain;
(b) if at the time thereof and immediately after giving effect thereto no Event of Default shall have occurred and be continuing or would result therefrom, (i) the liquidation, dissolution, merger or consolidation of any Subsidiary with or into the Borrower in a transaction in which the Borrower is the survivor or the requirements of Section 6.05(o) are otherwise complied with, (ii) the merger or consolidation of any Subsidiary (other than the Borrower) with or into the Borrower or any other Subsidiary in a transaction in which the surviving or resulting entity is or becomes the Borrower or a Subsidiary and, in the case of each of clauses (i) and (ii), no person other than the Borrower, the Borrower or a Subsidiary receives any consideration (unless otherwise permitted by Section 6.04), (iii) the liquidation, dissolution or merger or consolidation of any Subsidiary (other than the Borrower) with or into the Borrower or any other Subsidiary, (iv) the change in form of entity of the Borrower or any Subsidiary if the Borrower determines in good faith that such change in form is advisable or in the best interests of the Borrower and is not materially disadvantageous to the Lenders, (v) any Subsidiary (other than the Borrower) may merge or consolidate with any other person in order to effect an Investment permitted pursuant to Section 6.04 so long as the continuing or surviving person shall be the Borrower or a Subsidiary (unless otherwise permitted by Section 6.04), and which together with each of its Subsidiaries shall have complied with any applicable requirements of Section 5.10 or (vi) any Subsidiary (other than the Borrower) may merge or consolidate with any other person in order to effect an Asset Sale otherwise permitted pursuant to this Section 6.05;
(c) Dispositions to the Borrower or a Subsidiary (upon voluntary liquidation or otherwise); provided, that following any such Disposition of all or substantially all of the assets of the Borrower, the Borrower is the surviving entity or the requirements of Section 6.05(o) are otherwise complied with;
(d) Sale and Lease-Back Transactions permitted by Section 6.03;
(e) (i) Investments permitted by Section 6.04, Permitted Liens permitted by Section 6.02 and Restricted Payments permitted by Section 6.06 and (ii) any Disposition made in connection with the Transactions6.06;
(f) Dispositions of defaulted receivables in the ordinary course of business and not as part of an accounts receivables financing transaction;
(g) other Dispositions of assets; provided, that the Net Proceeds thereof, if any, are applied in accordance with Section 2.11(b) to the extent required thereby;
(h) Permitted Business Acquisitions (including any merger, consolidation or amalgamation in order to effect a Permitted Business Acquisition); provided, that following any such merger, consolidation or amalgamation involving the Borrower, the Borrower is the surviving entity or the requirements of Section 6.05(o) are otherwise complied with;
(i) leases, assignments, licenses or subleases or sublicenses of any real or personal property in the ordinary course of business or consistent with past practice or industry norm;
(j) Dispositions of inventory or equipment or Dispositions or abandonment of Intellectual Property of the Borrower and its Subsidiaries determined in good faith by the management of the Borrower to be no longer useful or necessary in the operation of the business of, or material to the conduct of the business of, the Borrower or any of the Subsidiaries;
(k) acquisitions and purchases made with the proceeds of any Asset Sale pursuant to the first proviso of clause (a) of the definition of “Net Proceeds”;[reserved]
(l) the purchase and Disposition (including by capital contribution) of (i) Securitization Assets including pursuant to Permitted Securitization Financings, (ii) any other Securitization Assets subject to Liens securing Permitted Securitization Financing and (iii) receivables Receivables Assets in connection with a receivables factoring or financing;
(m) to the extent constituting a Disposition, any termination, settlement, extinguishment or unwinding of obligations in respect of any Hedging Agreement;
(n) any exchange of assets for services and/or other assets used or useful in a Similar Business of comparable or greater value; provided, that (i) to the extent the consideration received consists of assets, at least 90% of the consideration received by the transferor consists of assets that will be used in a business or business activity permitted hereunder, (ii) in the event of a swap with a fair market value (as determined in good faith by the Borrower) in excess of $10,000,000, the Administrative Agent shall have received a certificate from a Responsible Officer of the Borrower with respect to such fair market value and (iii) in the event of a swap with a fair market value (as determined in good faith by the Borrower) in excess of $15,000,000, such exchange shall have been approved by at least a majority of the Board of Directors of Holdings or the Borrower;
(o) if at the time thereof and immediately after giving effect thereto no Event of Default shall have occurred and be continuing or would result therefrom, the Borrower, any Subsidiary or any other person may be liquidated, dissolved, merged, amalgamated or consolidated with or into the Borrower; provided that (A) the Borrower shall be the surviving entity or (B) if the surviving entity is not the Borrower (such other person, the “Successor Borrower”), (1) the Successor Borrower shall be an entity organized or existing under the laws of the United States, any state thereof or the District of Columbia, (2) the Successor Borrower shall expressly assume all the obligations of the Borrower under this Agreement and the other Loan Documents pursuant to a supplement hereto or thereto in form reasonably satisfactory to the Administrative Agent, (3) each Guarantor, unless it is the other party to such merger or consolidation, shall have by a counterpart to this Agreement, as applicable, confirmed that its guarantee thereunder shall apply to any Successor Borrower’s obligations under this Agreement, (4) each Subsidiary Guarantor, unless it is the other party to such merger or consolidation, shall have by a supplement to any applicable Collateral Document affirmed that its obligations thereunder shall apply to its guarantee as reaffirmed pursuant to clause (3), (5) each mortgagor of a Mortgaged Property), unless it is the other party to such merger or consolidation, shall have affirmed that its obligations under the applicable Mortgage shall apply to its guarantee as reaffirmed pursuant to clause (3) [reserved] and (6) the Successor Borrower shall have delivered to the Administrative Agent (x) an officer’s certificate stating that such merger or consolidation does not violate this Agreement or any other Loan Document and (y) if requested by the Administrative Agent, an opinion of counsel to the effect that such liquidation, dissolution, merger, amalgamation or consolidation does not violate this Agreement or any other Loan Document and covering such other matters as are contemplated by the Collateral and Guarantee Requirement to be covered in opinions of counsel (it being understood that if the foregoing are satisfied, the Successor Borrower will succeed to, and be substituted for, the Borrower under this Agreement);
(p) Dispositions in connection with the exercise of any subscriptions, options, warrants, puts, calls or other rights or commitments pursuant to agreements set forth on Schedule 3.08(b);
(q) Dispositions of property or assets (i) acquired after the Closing Date which property or assets are not used or useful to the core or principal business of the Borrower and the Subsidiaries in the good faith determination of the Borrower or (ii) that are made in connection with the approval of any applicable antitrust authority or as otherwise necessary or advisable in the good faith determination of the Borrower to consummate any Permitted Business Acquisition, New Project, Investment or other transaction; and;
(r) any Disposition to effect the formation of any Subsidiary that is a Delaware Divided LLC and would otherwise not be prohibited hereunder; provided that any disposition or other allocation of any assets (including any Equity Interests of such Delaware Divided LLC) in connection therewith is otherwise permitted hereunder; and
(s) the consummation of the Merger pursuant to, and in accordance with the requirements of, the Merger Agreement. Notwithstanding anything to the contrary contained in Section 6.05 above, no Disposition of assets under Section 6.05(g) or, solely with respect to Sale and Lease-Back Transactions referred to in clause (b)(y) of Section 6.03, under Section 6.05(d), shall be permitted unless (i) such Disposition is for fair market value (as determined in good faith by the Borrower), or if not for fair market value, the shortfall is permitted as an Investment under Section 6.046.04 (and reduces the applicable Investment basket on a dollar-for-dollar basis), and (ii) at least 75% of the proceeds of such Disposition (except to Loan Parties) consist of cash or Permitted Investments; provided, that the provisions of this clause (ii) shall not apply to any individual transaction or series of related transactions involving assets with a fair market value (as determined in good faith by the Borrower) of less than $12,500,000 or to other transactions involving assets with a fair market value (as determined in good faith by the Borrower) of not more than the greater of $85,000,000 107,000,000 and 0.20 times the Adjusted EBITDA calculated on a Pro Forma Basis for the then most recently ended Test Period in the aggregate for all such transactions during the term of this Agreement; provided, further, that for purposes of this clause (ii), each of the following shall be deemed to be cash: (a) the amount of any liabilities (as shown on the Borrower’s or such Subsidiary’s most recent balance sheet or in the notes thereto or, if incurred or increased subsequent to the date of such balance sheet, such liabilities that would have been shown on the Borrower’s or such any Subsidiary’s balance sheet or in the notes thereto if such incurrence or increase had taken place on or prior to the date of such balance sheet, as determined by the Borrower) of the Borrower or any Subsidiary that are assumed by the transferee of any such assets (or a third party in connection with such transfer) or are otherwise cancelled or terminated in connection with such transaction, (b) any notes or other obligations or other securities or assets received by the Borrower or such any Subsidiary from the transferee that are converted by the Borrower or such any Subsidiary into cash within 180 days after receipt thereof (to the extent of the cash received), (c) any Designated Non-Cash Consideration received by the Borrower or any of its Subsidiaries in such Disposition having an aggregate fair market value (as determined in good faith by the Borrower), taken together with all other Designated Non-Cash Consideration received pursuant to this clause (c) that is at that time outstanding, not to exceed the greater of $165,000,000 187,000,000 and 0.35 times the Adjusted EBITDA calculated on a Pro Forma Basis for the Test Period ended immediately prior to the receipt of such Designated Non-Cash Consideration (with the fair market value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value), (d) the amount of Indebtedness of any Subsidiary that is no longer a Subsidiary as a result of such Asset Sale, to the extent that Holdings, the Borrower and each other Subsidiary are released from any guarantee of payment of such Indebtedness in connection with the Asset Sale and (e) consideration consisting of Indebtedness of the Borrower or a Subsidiary (other than Indebtedness that is subordinated in right of payment to the Loan Obligations) received from persons who are not Holdings, the Borrower or a Subsidiary in connection with the Asset Sale and that is cancelled or otherwise extinguished. Notwithstanding the foregoing, the Borrower shall not, nor shall it permit any Subsidiary to, (x) transfer (including by way of sale, investment, exclusive license or designation of a Subsidiary as an Unrestricted Subsidiary) any Intellectual Property that is material to the business of the Borrower and the Subsidiaries taken as a whole to any Unrestricted Subsidiary and (y) transfer legal or beneficial ownership of, or an exclusive license to, any Intellectual Property that is material to the business of the Borrower and the Subsidiaries taken as a whole to any Unrestricted Subsidiary to Holdings or any Subsidiary that is not a Loan Party (including by way of sale or investment). For purposes of this Agreement, the fair market value of any assets acquired, leased, exchanged, Disposed of, sold, conveyed or transferred by the Borrower or any Subsidiary shall be determined in good faith by the Borrower and may be determined either, at the option of the Borrower, at the time of such acquisition, lease, exchange, Disposition, sale, conveyance or transfer, as applicable, or as of the date of the definitive agreement with respect to such acquisition, lease, exchange, Disposition, sale, conveyance or transfer, as applicable.
Appears in 1 contract
Samples: Credit Agreement (Dave & Buster's Entertainment, Inc.)
Mergers, Consolidations, Sales of Assets and Acquisitions. Merge into or consolidate with any other person, or permit any other person to merge into or consolidate with it, or Dispose of (in one transaction or in a series of related transactions) all or any part of its assets (whether now owned or hereafter acquired), effect any Delaware LLC Division or Dispose of any Equity Interests of any Subsidiary, or purchase, lease or otherwise acquire (in one transaction or a series of related transactions) all of the assets of any other person or division or line of business of a person, except that this Section 6.05 shall not prohibit:
(a) (i) the purchase, discount or Disposition of equipment, inventory, accounts receivable, notes receivable or other assets, in each case in the ordinary course of business or consistent with past practice or industry norm by the Borrower or any Subsidiary or the conversion of accounts receivable to notes receivable, (ii) the acquisition or lease (pursuant to an operating lease) of any other asset in the ordinary course of business or consistent with past practice or industry norm by the Borrower or any Subsidiary or, with respect to operating leases, otherwise for fair market value on market terms (as determined in good faith by the Borrower), (iii) the Disposition of surplus, obsolete, damaged or worn out equipment or other property by the Borrower or any Subsidiary in the ordinary course of business or consistent with past practice or industry norm or determined in good faith by the Borrower to be no longer used or useful or necessary in the operation of the business of the Borrower or any Subsidiary, (iv) [reserved], (v) the Disposition of Permitted Investments in the ordinary course of business or (vi) the Disposition of property or equipment or the abandonment of Intellectual Property rights that is otherwise economically impracticable to maintain;
(b) if at the time thereof and immediately after giving effect thereto no Event of Default shall have occurred and be continuing or would result therefrom, (i) the liquidation, dissolution, merger or consolidation of any Subsidiary with or into the Borrower in a transaction in which the Borrower is the survivor or the requirements of Section 6.05(o) are otherwise complied with, (ii) the merger or consolidation of any Subsidiary (other than the Borrower) with or into the Borrower or any other Subsidiary in a transaction in which the surviving or resulting entity is or becomes the Borrower or a Subsidiary and, in the case of each of clauses (i) and (ii), no person other than the Borrower, the Borrower or a Subsidiary receives any consideration (unless otherwise permitted by Section 6.04), (iii) the liquidation, dissolution or merger or consolidation of any Subsidiary (other than the Borrower) with or into the Borrower or any other Subsidiary, (iv) the change in form of entity of the Borrower or any Subsidiary if the Borrower determines in good faith that such change in form is advisable or in the best interests of the Borrower and is not materially disadvantageous to the Lenders, (v) any Subsidiary (other than the Borrower) may merge or consolidate with any other person in order to effect an Investment permitted pursuant to Section 6.04 so long as the continuing or surviving person shall be the Borrower or a Subsidiary (unless otherwise permitted by Section 6.04), and which together with each of its Subsidiaries shall have complied with any applicable requirements of Section 5.10 or (vi) any Subsidiary (other than the Borrower) may merge or consolidate with any other person in order to effect an Asset Sale otherwise permitted pursuant to this Section 6.05;
(c) Dispositions to the Borrower or a Subsidiary (upon voluntary liquidation or otherwise); provided, that following any such Disposition of all or substantially all of the assets of the Borrower, the Borrower is the surviving entity or the requirements of Section 6.05(o) are otherwise complied with;
(d) Sale and Lease-Back Transactions permitted by Section 6.03;
(e) (i) Investments permitted by Section 6.04, Permitted Liens and Restricted Payments permitted by Section 6.06 and (ii) any Disposition made in connection with the Transactions;
(f) Dispositions of defaulted receivables in the ordinary course of business and not as part of an accounts receivables financing transaction;
(g) other Dispositions of assets; provided, that the Net Proceeds thereof, if any, are applied in accordance with Section 2.11(b) to the extent required thereby;
(h) Permitted Business Acquisitions (including any merger, consolidation or amalgamation in order to effect a Permitted Business Acquisition); provided, that following any such merger, consolidation or amalgamation involving the Borrower, the Borrower is the surviving entity or the requirements of Section 6.05(o) are otherwise complied with;
(i) leases, assignments, licenses or subleases or sublicenses of any real or personal property in the ordinary course of business or consistent with past practice or industry norm;
(j) Dispositions of inventory or equipment or Dispositions or abandonment of Intellectual Property of the Borrower and its Subsidiaries determined in good faith by the management of the Borrower to be no longer useful or necessary in the operation of the business of, or material to the conduct of the business of, the Borrower or any of the Subsidiaries;
(k) acquisitions and purchases made with the proceeds of any Asset Sale pursuant to the first proviso of clause (a) of the definition of “Net Proceeds”;
(l) the purchase and Disposition (including by capital contribution) of (i) Securitization Assets including pursuant to Permitted Securitization Financings, (ii) any other Securitization Assets subject to Liens securing Permitted Securitization Financing and (iii) receivables in connection with a receivables financing;
(m) to the extent constituting a Disposition, any termination, settlement, extinguishment or unwinding of obligations in respect of any Hedging Agreement;
(n) any exchange of assets for services and/or other assets used or useful in a Similar Business of comparable or greater value; provided, that (i) to the extent the consideration received consists of assets, at least 90% of the consideration received by the transferor consists of assets that will be used in a business or business activity permitted hereunder, (ii) in the event of a swap with a fair market value (as determined in good faith by the Borrower) in excess of $10,000,000, the Administrative Agent shall have received a certificate from a Responsible Officer of the Borrower with respect to such fair market value and (iii) in the event of a swap with a fair market value (as determined in good faith by the Borrower) in excess of $15,000,000, such exchange shall have been approved by at least a majority of the Board of Directors of Holdings or the Borrower;
(o) if at the time thereof and immediately after giving effect thereto no Event of Default shall have occurred and be continuing or would result therefrom, the Borrower, any Subsidiary or any other person may be liquidated, dissolved, merged, amalgamated or consolidated with or into the Borrower; provided that (A) the Borrower shall be the surviving entity or (B) if the surviving entity is not the Borrower (such other person, the “Successor Borrower”), (1) the Successor Borrower shall be an entity organized or existing under the laws of the United States, any state thereof or the District of Columbia, (2) the Successor Borrower shall expressly assume all the obligations of the Borrower under this Agreement and the other Loan Documents pursuant to a supplement hereto or thereto in form reasonably satisfactory to the Administrative Agent, (3) each Guarantor, unless it is the other party to such merger or consolidation, shall have by a counterpart to this Agreement, as applicable, confirmed that its guarantee thereunder shall apply to any Successor Borrower’s obligations under this Agreement, (4) each Subsidiary Guarantor, unless it is the other party to such merger or consolidation, shall have by a supplement to any applicable Collateral Document affirmed that its obligations thereunder shall apply to its guarantee as reaffirmed pursuant to clause (3), (5) each mortgagor of a Mortgaged Property, unless it is the other party to such merger or consolidation, shall have affirmed that its obligations under the applicable Mortgage shall apply to its guarantee as reaffirmed pursuant to clause (3) and (6) the Successor Borrower shall have delivered to the Administrative Agent (x) an officer’s certificate stating that such merger or consolidation does not violate this Agreement or any other Loan Document and (y) if requested by the Administrative Agent, an opinion of counsel to the effect that such liquidation, dissolution, merger, amalgamation or consolidation does not violate this Agreement or any other Loan Document and covering such other matters as are contemplated by the Collateral and Guarantee Requirement to be covered in opinions of counsel (it being understood that if the foregoing are satisfied, the Successor Borrower will succeed to, and be substituted for, the Borrower under this Agreement);
(p) Dispositions in connection with the exercise of any subscriptions, options, warrants, puts, calls or other rights or commitments pursuant to agreements set forth on Schedule 3.08(b);
(q) Dispositions of property or assets (i) acquired after the Closing Date which property or assets are not used or useful to the core or principal business of the Borrower and the Subsidiaries in the good faith determination of the Borrower or (ii) that are made in connection with the approval of any applicable antitrust authority or as otherwise necessary or advisable in the good faith determination of the Borrower to consummate any Permitted Business Acquisition, New Project, Investment or other transaction; and
(r) any Disposition to effect the formation of any Subsidiary that is a Delaware Divided LLC and would otherwise not be prohibited hereunder; provided that any disposition or other allocation of any assets (including any Equity Interests of such Delaware Divided LLC) in connection therewith is otherwise permitted hereunder. Notwithstanding anything to the contrary contained in Section 6.05 above, no Disposition of assets under Section 6.05(g) or, solely with respect to Sale and Lease-Back Transactions referred to in clause (b)(y) of Section 6.03, under Section 6.05(d), shall be permitted unless (i) such Disposition is for fair market value (as determined in good faith by the Borrower), or if not for fair market value, the shortfall is permitted as an Investment under Section 6.04, and (ii) at least 75% of the proceeds of such Disposition (except to Loan Parties) consist of cash or Permitted Investments; provided, that the provisions of this clause (ii) shall not apply to any individual transaction or series of related transactions involving assets with a fair market value (as determined in good faith by the Borrower) of less than $12,500,000 or to other transactions involving assets with a fair market value (as determined in good faith by the Borrower) of not more than the greater of $85,000,000 85,000,000147,000,000 and 0.20 times the Adjusted EBITDA calculated on a Pro Forma Basis for the then most recently ended Test Period in the aggregate for all such transactions during the term of this Agreement; provided, further, that for purposes of this clause (ii), each of the following shall be deemed to be cash: (a) the amount of any liabilities (as shown on the Borrower’s or such Subsidiary’s most recent balance sheet or in the notes thereto or, if incurred or increased subsequent to the date of such balance sheet, such liabilities that would have been shown on the Borrower’s or such Subsidiary’s balance sheet or in the notes thereto if such incurrence or increase had taken place on or prior to the date of such balance sheet, as determined by the Borrower) of the Borrower or any Subsidiary that are assumed by the transferee of any such assets (or a third party in connection with such transfer) or are otherwise cancelled or terminated in connection with such transaction, (b) any notes or other obligations or other securities or assets received by the Borrower or such Subsidiary from the transferee that are converted by the Borrower or such Subsidiary into cash within 180 days after receipt thereof (to the extent of the cash received), (c) any Designated Non-Cash Consideration received by the Borrower or any of its Subsidiaries in such Disposition having an aggregate fair market value (as determined in good faith by the Borrower), taken together with all other Designated Non-Cash Consideration received pursuant to this clause (c) that is at that time outstanding, not to exceed the greater of $165,000,000 165,000,000257,250,000 and 0.35 times the Adjusted EBITDA calculated on a Pro Forma Basis for the Test Period ended immediately prior to the receipt of such Designated Non-Cash Consideration (with the fair market value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value), (d) the amount of Indebtedness of any Subsidiary that is no longer a Subsidiary as a result of such Asset Sale, to the extent that Holdings, the Borrower and each other Subsidiary are released from any guarantee of payment of such Indebtedness in connection with the Asset Sale and (e) consideration consisting of Indebtedness of the Borrower or a Subsidiary (other than Indebtedness that is subordinated in right of payment to the Loan Obligations) received from persons who are not Holdings, the Borrower or a Subsidiary in connection with the Asset Sale and that is cancelled or otherwise extinguished. For purposes of this Agreement, the fair market value of any assets acquired, leased, exchanged, Disposed of, sold, conveyed or transferred by the Borrower or any Subsidiary shall be determined in good faith by the Borrower and may be determined either, at the option of the Borrower, at the time of such acquisition, lease, exchange, Disposition, sale, conveyance or transfer, as applicable, or as of the date of the definitive agreement with respect to such acquisition, lease, exchange, Disposition, sale, conveyance or transfer, as applicable.
Appears in 1 contract
Mergers, Consolidations, Sales of Assets and Acquisitions. Merge into into, amalgamate with or consolidate with any other person, or permit any other person to merge into into, amalgamate with or consolidate with it, or Dispose of (in one transaction or in a series of related transactions) all or any part of its assets (whether now owned or hereafter acquired), effect any Delaware LLC Division or Dispose of any Equity Interests of any Subsidiary, or purchase, lease or otherwise acquire (in one transaction or a series of related transactions) all or substantially all of the assets of any other person or division or line of business of a personperson (including, in each case, pursuant to a Division), except that this Section 6.05 shall not prohibit:
(a) (i) the purchasepurchase and Disposition by Parent or any Subsidiary of inventory, discount or Disposition of products, equipment, inventory, services or accounts receivable, notes receivable or other assets, in each case in the ordinary course of business or consistent with past practice or industry norm by the Borrower or any Subsidiary or the conversion of accounts receivable to notes receivable, practice,
(ii) the disposition of a business not comprising the disposition of an entire line of business,
(iii) the acquisition or lease (pursuant to an operating lease) of any other asset in the ordinary course of business or consistent with past practice or industry norm by the Borrower Parent or any Subsidiary or, with respect to operating leases, otherwise for fair market value Fair Market Value on market terms (as determined in good faith by the Borrower), ,
(iiiiv) the Disposition by Parent or any Subsidiary of surplus, obsolete, damaged or worn out equipment or other property by the Borrower or any Subsidiary in the ordinary course of business or consistent with past practice or industry norm or determined in good faith by the Borrower to be no longer used or useful or necessary in the operation of the business of the Borrower or any Subsidiary, (iv) [reserved], practice,
(v) the Disposition of Permitted Investments in the ordinary course of business or business,
(vi) sales of non-core personal property acquired in connection with an acquisition permitted hereunder and sales of real property acquired in an acquisition permitted hereunder, which, within ninety (90) days of the Disposition date of property the acquisition, are designated in writing to the Administrative Agent as being held for sale and not for the continued operation of Parent or equipment any of its Subsidiaries or the abandonment any of Intellectual Property rights that is otherwise economically impracticable to maintaintheir respective businesses,
(vii) any Disclosed Transaction;
(b) if at the time thereof and immediately after giving effect thereto no Event of Default shall have occurred and be continuing or would result therefrom, ,
(i) the liquidationmerger, dissolution, merger amalgamation or consolidation of any Subsidiary with or into Parent or the Borrower in a transaction in which Parent or the Borrower is the survivor or the requirements of Section 6.05(o) are otherwise complied with, survivor,
(ii) the merger merger, amalgamation or consolidation of any Subsidiary (other than the Borrower) with or into the Borrower or any other Subsidiary Guarantor in a transaction in which the surviving or resulting entity is or becomes the Borrower or a Subsidiary Guarantor, and, in the case of each of clauses (i) and (ii)) above, no person other than the Borrower, the Borrower or a Subsidiary Guarantor receives any consideration (unless otherwise permitted by Section 6.04), ,
(iii) the liquidationmerger, amalgamation or consolidation of any Subsidiary that is not a Guarantor with or into any other Subsidiary that is not a Guarantor,
(iv) the liquidation or dissolution or merger or consolidation change in form of entity of any Subsidiary (other than the Borrower) with or into if (x) the Borrower or any other Subsidiary, (iv) the change in form of entity of the Borrower or any Subsidiary if the Borrower Parent determines in good faith that such liquidation, dissolution or change in form is advisable or in the best interests of the Borrower Parent and its Subsidiaries and is not materially disadvantageous to the Lenders, Lenders and (y) the same meets the requirements contained in the proviso to Section 5.01(a),
(v) the merger, amalgamation or consolidation of any Subsidiary (other than the Borrower) may merge or consolidate with any other person in order to effect an Investment permitted pursuant to Section 6.04 so long as the continuing or surviving person shall be the Borrower or a Subsidiary (unless otherwise permitted by Section 6.046.04 (other than Section 6.04(m)(ii))), which shall be a Loan Party if the merging, amalgamating or consolidating Subsidiary was a Loan Party and which together with each of its Subsidiaries shall have complied with any applicable requirements of Section 5.10 5.10, or (vi) any Subsidiary (other than the Borrower) may merge merge, amalgamate or consolidate with any other person in order to effect an Asset Sale otherwise permitted pursuant to this Section 6.05;
(c) Dispositions to Parent, the Borrower or a Subsidiary (upon voluntary liquidation or otherwise)Subsidiary; provided, that following any such Disposition of all or substantially all of the assets of Dispositions by a Loan Party to a Subsidiary that is not a Loan Party in reliance on this clause (c) shall be for Fair Market Value (as determined in good faith by the Borrower, the Borrower is the surviving entity ) or the requirements of made in compliance with Section 6.05(o) are otherwise complied with6.04;
(d) Sale and Lease-Back Transactions permitted licenses, sublicenses, or covenants not to sue by Section 6.03Parent or any Subsidiary of or under Intellectual Property or software or other technology;
(e) (i) Investments permitted by Section 6.046.04 (other than Section 6.04(m)(ii)), Permitted Liens Liens, and Restricted Payments permitted by Section 6.06 and (ii) any Disposition made in connection with the Transactions6.06;
(f) Dispositions of defaulted receivables the discount, forgiveness or sale, in each case without recourse and in the ordinary course of business business, of past due receivables arising in the ordinary course of business, but only in connection with the compromise or collection thereof consistent with customary industry practice (and not as part of an accounts receivables any bulk sale or financing transactionof receivables);
(g) other Dispositions of assetsassets (including in connection with sale leaseback transactions); provided, that (i) the Net Proceeds thereof, if any, are applied in accordance with Section 2.11(b) to the extent required therebythereby and (ii) any such Dispositions shall comply with the final sentence of this Section 6.05;
(h) Permitted Business Acquisitions (including any merger, consolidation or amalgamation in order to effect a Permitted Business Acquisition); provided, that following any such merger, consolidation or amalgamation involving the Borrower, the Borrower is the surviving entity or the requirements of Section 6.05(o6.05(n) are otherwise complied with;
(i) leases, assignments, licenses or subleases or sublicenses of any real or personal property in the ordinary course of business or consistent with past practice or industry normbusiness;
(j) Dispositions of inventory or equipment or Dispositions or abandonment of Intellectual Property of the Borrower Parent and its Subsidiaries determined in good faith by the management of the Borrower to be no longer economically practicable or commercially reasonable to maintain or useful or necessary in the operation of the business of, or material to the conduct of the business of, the Borrower Parent or any of the Subsidiaries;
(k) acquisitions and purchases made with the proceeds of any Asset Sale Dispositions pursuant to the first proviso any individual transaction or series of clause (a) related transactions involving assets with a Fair Market Value of the definition of “Net Proceeds”less than $25,000,000;
(l) the purchase and Disposition (including by capital contribution) of (i) Securitization Assets and Permitted Receivables Facility Assets, or participations therein, including pursuant to Permitted Qualified Securitization Financings, (ii) any other Securitization Assets subject to Liens securing Permitted Securitization Financing and (iii) receivables in connection with a receivables financingTransactions or Qualified Receivables Facilities;
(m) to the extent constituting a Disposition, any termination, settlement, extinguishment or unwinding of obligations in respect of any Hedging Agreement;
(n) any exchange or swap of assets (other than cash and Permitted Investments) for services and/or other assets used or useful in a Similar Business (other than cash and Permitted Investments) of comparable or greater value; provided, that (i) value or usefulness to the extent business of Parent and the consideration received consists of assetsSubsidiaries as a whole, at least 90% of the consideration received by the transferor consists of assets that will be used in a business or business activity permitted hereunder, (ii) in the event of a swap with a fair market value (as determined in good faith by the Borrower) in excess management of $10,000,000, the Administrative Agent shall have received a certificate from a Responsible Officer of the Borrower with respect to such fair market value and (iii) in the event of a swap with a fair market value (as determined in good faith by the Borrower) in excess of $15,000,000, such exchange shall have been approved by at least a majority of the Board of Directors of Holdings or the Borrower;
(on) if at the time thereof and immediately after giving effect thereto no Event of Default shall have occurred and be continuing or would result therefrom, the Borrower, any Subsidiary or any other person may be liquidated, dissolved, merged, amalgamated or consolidated with or into the Borrower; , provided that (A) the Borrower shall be the surviving entity or (B) if the surviving entity is not the Borrower (such other person, the “Successor Borrower”), (1) the Successor Borrower shall be an entity organized or existing under the laws of the United States, any state thereof or the District of Columbia, (2) the Successor Borrower shall expressly assume all the obligations of the Borrower under this Agreement and the other Loan Documents pursuant to a supplement hereto or thereto and, in the case of any Security Document, by executing and/or delivering any additional required documents, in each case in a form reasonably satisfactory to the Administrative Agent, (3) each Guarantor, unless it is the other party to such merger merger, amalgamation or consolidation, shall have by a counterpart supplement to this the Guarantee Agreement, as applicable, confirmed that its guarantee thereunder shall apply to any Successor Borrower’s obligations under this Agreement, (4) each Subsidiary Guarantor, unless it is the other party to such merger merger, amalgamation or consolidation, shall have by a supplement to any applicable Collateral Security Document affirmed that its obligations thereunder shall apply to its guarantee as reaffirmed pursuant to clause (3), (5) each mortgagor of a Mortgaged Property[reserved], unless it is the other party to such merger or consolidation, shall have affirmed that its obligations under the applicable Mortgage shall apply to its guarantee as reaffirmed pursuant to clause (3) and (6) the Successor Borrower shall have delivered to the Administrative Agent (x) an officer’s a certificate of a Responsible Officer stating that such merger merger, amalgamation or consolidation does not violate this Agreement or any other Loan Document and (y) if requested by the Administrative Agent, an opinion of counsel to the effect that such liquidation, dissolution, merger, amalgamation or consolidation does not violate this Agreement or any other Loan Document and covering such other matters as are contemplated by the Collateral and Guarantee Requirement to be covered in opinions of counsel and (7) to the extent requested by the Administrative Agent or a Lender (as requested through the Administrative Agent), the Administrative Agent and any such Lender shall have received at least three (3) Business Days prior to the consummation of such merger, amalgamation or consolidation all documentation and other information required with respect to the Successor Borrower by regulatory authorities under applicable “know your customer” and anti-money laundering rules and regulations, including, without limitation, the USA PATRIOT Act and the Beneficial Ownership Regulation (it being understood that if the foregoing are satisfied, the Successor Borrower Bxxxxxxx will succeed to, and be substituted for, the Borrower under this Agreement);
(o) any conversion of a Loan Party from a corporation to a limited liability company, or from a limited liability company to a corporation, or other change in corporate formation;
(p) Dispositions in connection with the exercise any surrender, termination or waiver of contract rights or settlement, release, waiver of, recovery on or surrender of contract, tort or other claims of any subscriptions, options, warrants, puts, calls or other rights or commitments pursuant to agreements set forth on Schedule 3.08(b)kind;
(q) Dispositions any solvent liquidation or dissolution of property a Subsidiary of Parent, provided that such Subsidiary’s direct parent is also either Parent or assets (i) acquired after a Subsidiary and immediately becomes the Closing Date which property or assets are not used or useful to the core or principal business owner of the Borrower and the Subsidiaries in the good faith determination of the Borrower or (ii) that are made in connection with the approval of any applicable antitrust authority or as otherwise necessary or advisable in the good faith determination of the Borrower to consummate any Permitted Business Acquisition, New Project, Investment or other transaction; andsuch Subsidiary’s assets;
(r) any Disposition financing transaction with respect to effect property built, acquired, replaced, repaired or improved (including any reconstruction, refurbishment, renovation and/or development of real property) by Parent or any of its Subsidiaries after the formation Closing Date, including, sale leaseback transactions and Securitization Transactions permitted by this Agreement;
(s) any issuance, sale, pledge or other disposition of Equity Interests in, or Indebtedness or other securities of, an Unrestricted Subsidiary;
(t) the sale, transfer, termination or other disposition in connection with Hedging Agreements incurred in compliance with this Agreement or the partial or total unwinding of obligations in respect of any Cash Management Agreements or Hedging Agreements in compliance with this Agreement;
(u) sales of assets received by Parent or any Subsidiary that is upon the foreclosure on a Delaware Divided LLC Lien;
(v) dispositions arising from foreclosures, condemnations, eminent domain, seizure, nationalization or any similar action with respect to assets, and would otherwise not be prohibited hereunderdispositions of property subject to casualty events (including, without limitation, resulting from any involuntary loss or damage to or destruction of any property or assets of Parent or any Subsidiary);
(w) the termination of leases and subleases in the ordinary course of business;
(x) to the extent allowable under Section 1031 of the Code, any exchange of like property (excluding any boot thereon) for use in a Permitted Business;
(y) dispositions of assets or Investments (including Equity Interests) in connection with the establishment or operation of joint ventures to the extent required by, or made pursuant to (including customary buy/sell arrangements or rights of first refusal between the joint venture parties set forth in) joint venture arrangements and similar binding arrangements;
(z) any exchange of assets for other assets used in the business of Parent or any Subsidiary (including a combination of such assets and a de minimis amount of cash or Permitted Investments) of comparable or greater market value than the assets exchanged, as determined in good faith by Parent, which exchange occurs within 90 days of the transfer of such assets;
(aa) any sale leaseback transaction of any property acquired or built after the Closing Date; provided that such sale is for at least Fair Market Value;
(bb) the surrender or waiver of obligations of trade creditors or customers or other contract rights that were incurred in the ordinary course of business of Parent or any of Subsidiary, including pursuant to any plan of reorganization or similar arrangement upon the bankruptcy or insolvency of any trade creditor or customer or compromise, settlement, release or surrender of a contract, tort or other litigation claim, arbitration or other disputes;
(cc) dispositions of property to the extent that (i) such property is exchanged for credit against the purchase price of similar replacement property that is purchased within 90 days of such disposition or (ii) the proceeds of such disposition are applied within 90 days of such disposition to the purchase price of such replacement property (which replacement property is purchased within 90 days of such disposition);
(dd) sales of property in connection with factoring agreements or arrangements in the ordinary course of business, including to: (i) Citibank, N.A. under that certain Supplier Agreement, dated as of October 1, 2017, by and among the Borrower and Citibank, N.A. (as amended, restated, amended and restated, supplemented, and/or otherwise modified from time to time); and (ii) Taulia Inc. under the Taulia Business Exchange Hosted Service Terms and Conditions by and between Spirit AeroSystems (Europe) Limited and Taulia Inc. (as amended, restated, amended and restated, supplemented, and/or otherwise modified from time to time);
(ee) sales, transfers and/or other allocation dispositions of property by one or more Loan Parties in connection with the incurrence of any assets Qualifying IRB Financing or other Permitted Incentive Program; and
(including any Equity Interests of such Delaware Divided LLCff) in connection therewith is otherwise permitted hereundersales, transfers or other dispositions to customers pursuant to customer contracts. Notwithstanding anything to the contrary contained in Section 6.05 above, no Disposition of assets under Section 6.05(g) or, solely with respect to Sale and Lease-Back Transactions referred to shall in clause (b)(y) of Section 6.03, under Section 6.05(d), shall each case be permitted unless (i) such Disposition is for fair market value (as determined in good faith by the Borrower), or if not for fair market value, the shortfall is permitted as an Investment under Section 6.04Fair Market Value, and (ii) at least 75% of the proceeds of such Disposition (except to Loan Parties) consist of cash or Permitted Investments; provided, that the provisions of this clause (ii) shall not apply to any individual transaction or series of related transactions involving assets with a fair market value (as determined in good faith by the Borrower) of less than $12,500,000 or to other transactions involving assets with a fair market value (as determined in good faith by the Borrower) of not more than the greater of $85,000,000 and 0.20 times the Adjusted EBITDA calculated on a Pro Forma Basis for the then most recently ended Test Period in the aggregate for all such transactions during the term of this Agreement; provided, further, that for purposes of this clause (ii), each of the following shall be deemed to be cash: (a) the amount of any liabilities (as shown on the Borrower’s or such Subsidiary’s most recent balance sheet or in the notes thereto or, if incurred or increased subsequent to the date of such balance sheet, such liabilities that would have been shown on the Borrower’s or such Subsidiary’s balance sheet or in the notes thereto if such incurrence or increase had taken place on or prior to the date of such balance sheet, as determined by the Borrower) of the Borrower or any Subsidiary that are assumed by the transferee of any such assets (or a third party in connection with such transfer) or are otherwise cancelled or terminated in connection with such transaction, (b) any notes or other obligations or other securities or assets received by the Borrower or such Subsidiary from the transferee that are converted by the Borrower or such Subsidiary into cash within 180 days after receipt thereof (to the extent of the cash received), (c) any Designated Non-Cash Consideration received by the Borrower or any of its Subsidiaries in such Disposition having an aggregate fair market value (as determined in good faith by the Borrower), taken together with all other Designated Non-Cash Consideration received pursuant to this clause (c) that is at that time outstanding, not to exceed the greater of $165,000,000 and 0.35 times the Adjusted EBITDA calculated on a Pro Forma Basis for the Test Period ended immediately prior to the receipt of such Designated Non-Cash Consideration (with the fair market value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value), (d) the amount of Indebtedness of any Subsidiary that is no longer a Subsidiary as a result of such Asset Sale, to the extent that Holdings, the Borrower and each other Subsidiary are released from any guarantee of payment of such Indebtedness in connection with the Asset Sale and (e) consideration consisting of Indebtedness of the Borrower or a Subsidiary (other than Indebtedness that is subordinated in right of payment to the Loan Obligations) received from persons who are not Holdings, the Borrower or a Subsidiary in connection with the Asset Sale and that is cancelled or otherwise extinguished. For purposes of this Agreement, the fair market value of any assets acquired, leased, exchanged, Disposed of, sold, conveyed or transferred by the Borrower or any Subsidiary shall be determined in good faith by the Borrower and may be determined either, at the option of the Borrower, at the time of such acquisition, lease, exchange, Disposition, sale, conveyance or transfer, as applicable, or as of the date of the definitive agreement with respect to such acquisition, lease, exchange, Disposition, sale, conveyance or transfer, as applicable.
Appears in 1 contract
Samples: Delayed Draw Bridge Credit Agreement (Spirit AeroSystems Holdings, Inc.)
Mergers, Consolidations, Sales of Assets and Acquisitions. Merge into or consolidate with any other person, or permit any other person to merge into or consolidate with it, or Dispose of (in one transaction or in a series of related transactions) all or any part of its assets (whether now owned or hereafter acquired), effect any Delaware LLC Division or Dispose of any Equity Interests of any Subsidiary, or purchase, lease or otherwise acquire (in one transaction or a series of related transactions) all of the assets of any other person or division or line of business of a person, except that this Section 6.05 shall not prohibit:
(a) (i) the purchase, discount or Disposition of equipment, inventory, accounts receivable, notes receivable or other assets, in each case in the ordinary course of business or consistent with past practice or industry norm by the Borrower or any Subsidiary or the conversion of accounts receivable to notes receivable, (ii) the acquisition or lease (pursuant to an operating lease) of any other asset in the ordinary course of business or consistent with past practice or industry norm by the Borrower or any Subsidiary or, with respect to operating leases, otherwise for fair market value on market terms (as determined in good faith by the Borrower), (iii) the Disposition of surplus, obsolete, damaged or worn out equipment or other property by the Borrower or any Subsidiary in the ordinary course of business or consistent with past practice or industry norm or determined in good faith by the Borrower to be no longer used or useful or necessary in the operation of the business of the Borrower or any Subsidiary, (iv) [reserved], (v) the Disposition of Permitted Investments in the ordinary course of business or (vi) the Disposition of property or equipment or the abandonment of Intellectual Property rights that is otherwise economically impracticable to maintain;
(b) if at the time thereof and immediately after giving effect thereto no Event of Default shall have occurred and be continuing or would result therefrom, (i) the liquidation, dissolution, merger or consolidation of any Subsidiary with or into the Borrower in a transaction in which the Borrower is the survivor or the requirements of Section 6.05(o) are otherwise complied with, (ii) the merger or consolidation of any Subsidiary (other than the Borrower) with or into the Borrower or any other Subsidiary in a transaction in which the surviving or resulting entity is or becomes the Borrower or a Subsidiary and, in the case of each of clauses (i) and (ii), no person other than the Borrower, the Borrower or a Subsidiary receives any consideration (unless otherwise permitted by Section 6.04), (iii) the liquidation, dissolution or merger or consolidation of any Subsidiary (other than the Borrower) with or into the Borrower or any other Subsidiary, (iv) the change in form of entity of the Borrower or any Subsidiary if the Borrower determines in good faith that such change in form is advisable or in the best interests of the Borrower and is not materially disadvantageous to the Lenders, (v) any Subsidiary (other than the Borrower) may merge or consolidate with any other person in order to effect an Investment permitted pursuant to Section 6.04 so long as the continuing or surviving person shall be the Borrower or a Subsidiary (unless otherwise permitted by Section 6.04), and which together with each of its Subsidiaries shall have complied with any applicable requirements of Section 5.10 or (vi) any Subsidiary (other than the Borrower) may merge or consolidate with any other person in order to effect an Asset Sale otherwise permitted pursuant to this Section 6.05;; 179
(c) Dispositions to the Borrower or a Subsidiary (upon voluntary liquidation or otherwise); provided, that following any such Disposition of all or substantially all of the assets of the Borrower, the Borrower is the surviving entity or the requirements of Section 6.05(o) are otherwise complied with;
(d) Sale and Lease-Back Transactions permitted by Section 6.03;
(e) (i) Investments permitted by Section 6.04, Permitted Liens permitted by Section 6.02 and Restricted Payments permitted by Section 6.06 and (ii) any Disposition made in connection with the Transactions6.06;
(f) Dispositions of defaulted receivables in the ordinary course of business and not as part of an accounts receivables financing transaction;
(g) other Dispositions of assets; provided, that the Net Proceeds thereof, if any, are applied in accordance with Section 2.11(b) to the extent required thereby;
(h) Permitted Business Acquisitions (including any merger, consolidation or amalgamation in order to effect a Permitted Business Acquisition); provided, that following any such merger, consolidation or amalgamation involving the Borrower, the Borrower is the surviving entity or the requirements of Section 6.05(o) are otherwise complied with;
(i) leases, assignments, licenses or subleases or sublicenses of any real or personal property in the ordinary course of business or consistent with past practice or industry norm;
(j) Dispositions of inventory or equipment or Dispositions or abandonment of Intellectual Property of the Borrower and its Subsidiaries determined in good faith by the management of the Borrower to be no longer useful or necessary in the operation of the business of, or material to the conduct of the business of, the Borrower or any of the Subsidiaries;
(k) acquisitions and purchases made with the proceeds of any Asset Sale pursuant to the first proviso of clause (a) of the definition of “Net Proceeds”;[reserved]
(l) the purchase and Disposition (including by capital contribution) of (i) Securitization Assets including pursuant to Permitted Securitization Financings, (ii) any other Securitization Assets subject to Liens securing Permitted Securitization Financing and (iii) receivables Receivables Assets in connection with a receivables factoring or financing;
(m) to the extent constituting a Disposition, any termination, settlement, extinguishment or unwinding of obligations in respect of any Hedging Agreement;; 180
(n) any exchange of assets for services and/or other assets used or useful in a Similar Business of comparable or greater value; provided, that (i) to the extent the consideration received consists of assets, at least 90% of the consideration received by the transferor consists of assets that will be used in a business or business activity permitted hereunder, (ii) in the event of a swap with a fair market value (as determined in good faith by the Borrower) in excess of $10,000,000, the Administrative Agent shall have received a certificate from a Responsible Officer of the Borrower with respect to such fair market value and (iii) in the event of a swap with a fair market value (as determined in good faith by the Borrower) in excess of $15,000,000, such exchange shall have been approved by at least a majority of the Board of Directors of Holdings or the Borrower;
(o) if at the time thereof and immediately after giving effect thereto no Event of Default shall have occurred and be continuing or would result therefrom, the Borrower, any Subsidiary or any other person may be liquidated, dissolved, merged, amalgamated or consolidated with or into the Borrower; provided that (A) the Borrower shall be the surviving entity or (B) if the surviving entity is not the Borrower (such other person, the “Successor Borrower”), (1) the Successor Borrower shall be an entity organized or existing under the laws of the United States, any state thereof or the District of Columbia, (2) the Successor Borrower shall expressly assume all the obligations of the Borrower under this Agreement and the other Loan Documents pursuant to a supplement hereto or thereto in form reasonably satisfactory to the Administrative Agent, (3) each Guarantor, unless it is the other party to such merger or consolidation, shall have by a counterpart to this Agreement, as applicable, confirmed that its guarantee thereunder shall apply to any Successor Borrower’s obligations under this Agreement, (4) each Subsidiary Guarantor, unless it is the other party to such merger or consolidation, shall have by a supplement to any applicable Collateral Document affirmed that its obligations thereunder shall apply to its guarantee as reaffirmed pursuant to clause (3), (5) each mortgagor of a Mortgaged Property), unless it is the other party to such merger or consolidation, shall have affirmed that its obligations under the applicable Mortgage shall apply to its guarantee as reaffirmed pursuant to clause (3) [reserved] and (6) the Successor Borrower shall have delivered to the Administrative Agent (x) an officer’s certificate stating that such merger or consolidation does not violate this Agreement or any other Loan Document and (y) if requested by the Administrative Agent, an opinion of counsel to the effect that such liquidation, dissolution, merger, amalgamation or consolidation does not violate this Agreement or any other Loan Document and covering such other matters as are contemplated by the Collateral and Guarantee Requirement to be covered in opinions of counsel (it being understood that if the foregoing are satisfied, the Successor Borrower Xxxxxxxx will succeed to, and be substituted for, the Borrower under this Agreement);
(p) Dispositions in connection with the exercise of any subscriptions, options, warrants, puts, calls or other rights or commitments pursuant to agreements set forth on Schedule 3.08(b);
(q) Dispositions of property or assets (i) acquired after the Closing Date which property or assets are not used or useful to the core or principal business of the Borrower and the Subsidiaries in the good faith determination of the Borrower or (ii) that are made in connection with the approval of any applicable antitrust authority or as otherwise necessary or advisable in the good faith determination of the Borrower to consummate any Permitted Business Acquisition, New Project, Investment or other transaction; and181
(r) any Disposition to effect the formation of any Subsidiary that is a Delaware Divided LLC and would otherwise not be prohibited hereunder; provided that any disposition or other allocation of any assets (including any Equity Interests of such Delaware Divided LLC) in connection therewith is otherwise permitted hereunder; and
(s) the consummation of the Merger pursuant to, and in accordance with the requirements of, the Merger Agreement. Notwithstanding anything to the contrary contained in Section 6.05 above, no Disposition of assets under Section 6.05(g) or, solely with respect to Sale and Lease-Back Transactions referred to in clause (b)(y) of Section 6.03, under Section 6.05(d), shall be permitted unless (i) such Disposition is for fair market value (as determined in good faith by the Borrower), or if not for fair market value, the shortfall is permitted as an Investment under Section 6.046.04 (and reduces the applicable Investment basket on a dollar-for-dollar basis), and (ii) at least 75% of the proceeds of such Disposition (except to Loan Parties) consist of cash or Permitted Investments; provided, that the provisions of this clause (ii) shall not apply to any individual transaction or series of related transactions involving assets with a fair market value (as determined in good faith by the Borrower) of less than $12,500,000 or to other transactions involving assets with a fair market value (as determined in good faith by the Borrower) of not more than the greater of $85,000,000 107,000,000 and 0.20 times the Adjusted EBITDA calculated on a Pro Forma Basis for the then most recently ended Test Period in the aggregate for all such transactions during the term of this Agreement; provided, further, that for purposes of this clause (ii), each of the following shall be deemed to be cash: (a) the amount of any liabilities (as shown on the Borrower’s or such Subsidiary’s most recent balance sheet or in the notes thereto or, if incurred or increased subsequent to the date of such balance sheet, such liabilities that would have been shown on the Borrower’s or such any Subsidiary’s balance sheet or in the notes thereto if such incurrence or increase had taken place on or prior to the date of such balance sheet, as determined by the Borrower) of the Borrower or any Subsidiary that are assumed by the transferee of any such assets (or a third party in connection with such transfer) or are otherwise cancelled or terminated in connection with such transaction, (b) any notes or other obligations or other securities or assets received by the Borrower or such any Subsidiary from the transferee that are converted by the Borrower or such any Subsidiary into cash within 180 days after receipt thereof (to the extent of the cash received), (c) any Designated Non-Cash Consideration received by the Borrower or any of its Subsidiaries in such Disposition having an aggregate fair market value (as determined in good faith by the Borrower), taken together with all other Designated Non-Cash Consideration received pursuant to this clause (c) that is at that time outstanding, not to exceed the greater of $165,000,000 187,000,000 and 0.35 times the Adjusted EBITDA calculated on a Pro Forma Basis for the Test Period ended immediately prior to the receipt of such Designated Non-Cash Consideration (with the fair market value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value), (d) the amount of Indebtedness of any Subsidiary that is no longer a Subsidiary as a result of such Asset Sale, to the extent that Holdings, the Borrower and each other Subsidiary are released from any guarantee of payment of such Indebtedness in connection with the Asset Sale and (e) consideration consisting of Indebtedness of the Borrower or a Subsidiary (other than Indebtedness that is subordinated in right of payment to the Loan Obligations) received from persons who are not Holdings, the Borrower or a Subsidiary in connection with the Asset Sale and that is cancelled or otherwise extinguished. 182 Notwithstanding the foregoing, the Borrower shall not, nor shall it permit any Subsidiary to, (x) transfer (including by way of sale, investment, exclusive license or designation of a Subsidiary as an Unrestricted Subsidiary) any Intellectual Property that is material to the business of the Borrower and the Subsidiaries taken as a whole to any Unrestricted Subsidiary and (y) transfer legal or beneficial ownership of, or an exclusive license to, any Intellectual Property that is material to the business of the Borrower and the Subsidiaries taken as a whole to any Unrestricted Subsidiary to Holdings or any Subsidiary that is not a Loan Party (including by way of sale or investment). For purposes of this Agreement, the fair market value of any assets acquired, leased, exchanged, Disposed of, sold, conveyed or transferred by the Borrower or any Subsidiary shall be determined in good faith by the Borrower and may be determined either, at the option of the Borrower, at the time of such acquisition, lease, exchange, Disposition, sale, conveyance or transfer, as applicable, or as of the date of the definitive agreement with respect to such acquisition, lease, exchange, Disposition, sale, conveyance or transfer, as applicable.
Appears in 1 contract
Samples: Credit Agreement (Dave & Buster's Entertainment, Inc.)
Mergers, Consolidations, Sales of Assets and Acquisitions. Merge into or consolidate with any other person, or permit any other person to merge into or consolidate with it, or Dispose of (in one transaction or in a series of related transactions) all or any part of its assets (whether now owned or hereafter acquired), effect any Delaware LLC Division or Dispose of any Equity Interests of any Subsidiary, or purchase, lease or otherwise acquire (in one transaction or a series of related transactions) all of the assets of any other person or division or line of business of a person, except that this Section 6.05 shall not prohibit:
(a) (i) the purchase, discount or Disposition of equipment, inventory, accounts receivable, notes receivable or other assets, in each case in the ordinary course of business or consistent with past practice or industry norm by the Borrower or any Subsidiary or the conversion of accounts receivable to notes receivable, (ii) the acquisition or lease (pursuant to an operating lease) of any other asset in the ordinary course of business or consistent with past practice or industry norm by the Borrower or any Subsidiary or, with respect to operating leases, otherwise for fair market value on market terms (as determined in good faith by the Borrower), (iii) the Disposition of surplus, obsolete, damaged or worn out equipment or other property by the Borrower or any Subsidiary in the ordinary course of business or consistent with past practice or industry norm or determined in good faith by the Borrower to be no longer used or useful or necessary in the operation of the business of the Borrower or any Subsidiary, (iv) [reserved], (v) the Disposition of Permitted Investments in the ordinary course of business or (vi) the Disposition of property or equipment or the abandonment of Intellectual Property rights that is otherwise economically impracticable to maintain;
(b) if at the time thereof and immediately after giving effect thereto no Event of Default shall have occurred and be continuing or would result therefrom, (i) the liquidation, dissolution, merger or consolidation of any Subsidiary with or into the Borrower in a transaction in which the Borrower is the survivor or the requirements of Section 6.05(o) are otherwise complied with, (ii) the merger or consolidation of any Subsidiary (other than the Borrower) with or into the Borrower or any other Subsidiary in a transaction in which the surviving or resulting entity is or becomes the Borrower or a Subsidiary and, in the case of each of clauses (i) and (ii), no person other than the Borrower, the Borrower or a Subsidiary receives any consideration (unless otherwise permitted by Section 6.04), (iii) the liquidation, dissolution or merger or consolidation of any Subsidiary (other than the Borrower) with or into the Borrower or any other Subsidiary, (iv) the change in form of entity of the Borrower or any Subsidiary if the Borrower determines in good faith that such change in form is advisable or in the best interests of the Borrower and is not materially disadvantageous to the Lenders, (v) any Subsidiary (other than the Borrower) may merge or consolidate with any other person in order to effect an Investment permitted pursuant to Section 6.04 so long as the continuing or surviving person shall be the Borrower or a Subsidiary (unless otherwise permitted by Section 6.04), and which together with each of its Subsidiaries shall have complied with any applicable requirements of Section 5.10 or (vi) any Subsidiary (other than the Borrower) may merge or consolidate with any other person in order to effect an Asset Sale otherwise permitted pursuant to this Section 6.05;
(c) Dispositions to the Borrower or a Subsidiary (upon voluntary liquidation or otherwise); provided, that following any such Disposition of all or substantially all of the assets of the Borrower, the Borrower is the surviving entity or the requirements of Section 6.05(o) are otherwise complied with;
(d) Sale and Lease-Back Transactions permitted by Section 6.03;
(e) (i) Investments permitted by Section 6.04, Permitted Liens and Restricted Payments permitted by Section 6.06 and (ii) any Disposition made in connection with the Transactions;
(f) Dispositions of defaulted receivables in the ordinary course of business and not as part of an accounts receivables financing transaction;
(g) other Dispositions of assets; provided, that the Net Proceeds thereof, if any, are applied in accordance with Section 2.11(b) to the extent required thereby;
(h) Permitted Business Acquisitions (including any merger, consolidation or amalgamation in order to effect a Permitted Business Acquisition); provided, that following any such merger, consolidation or amalgamation involving the Borrower, the Borrower is the surviving entity or the requirements of Section 6.05(o) are otherwise complied with;
(i) leases, assignments, licenses or subleases or sublicenses of any real or personal property in the ordinary course of business or consistent with past practice or industry norm;
(j) Dispositions of inventory or equipment or Dispositions or abandonment of Intellectual Property of the Borrower and its Subsidiaries determined in good faith by the management of the Borrower to be no longer useful or necessary in the operation of the business of, or material to the conduct of the business of, the Borrower or any of the Subsidiaries;
(k) acquisitions and purchases made with the proceeds of any Asset Sale pursuant to the first proviso of clause (a) of the definition of “Net Proceeds”;
(l) the purchase and Disposition (including by capital contribution) of (i) Securitization Assets including pursuant to Permitted Securitization Financings, (ii) any other Securitization Assets subject to Liens securing Permitted Securitization Financing and (iii) receivables in connection with a receivables financing;
(m) to the extent constituting a Disposition, any termination, settlement, extinguishment or unwinding of obligations in respect of any Hedging Agreement;
(n) any exchange of assets for services and/or other assets used or useful in a Similar Business of comparable or greater value; provided, that (i) to the extent the consideration received consists of assets, at least 90% of the consideration received by the transferor consists of assets that will be used in a business or business activity permitted hereunder, (ii) in the event of a swap with a fair market value (as determined in good faith by the Borrower) in excess of $10,000,000, the Administrative Agent shall have received a certificate from a Responsible Officer of the Borrower with respect to such fair market value and (iii) in the event of a swap with a fair market value (as determined in good faith by the Borrower) in excess of $15,000,000, such exchange shall have been approved by at least a majority of the Board of Directors of Holdings or the Borrower;
(o) if at the time thereof and immediately after giving effect thereto no Event of Default shall have occurred and be continuing or would result therefrom, the Borrower, any Subsidiary or any other person may be liquidated, dissolved, merged, amalgamated or consolidated with or into the Borrower; provided that (A) the Borrower shall be the surviving entity or (B) if the surviving entity is not the Borrower (such other person, the “Successor Borrower”), (1) the Successor Borrower shall be an entity organized or existing under the laws of the United States, any state thereof or the District of Columbia, (2) the Successor Borrower shall expressly assume all the obligations of the Borrower under this Agreement and the other Loan Documents pursuant to a supplement hereto or thereto in form reasonably satisfactory to the Administrative Agent, (3) each Guarantor, unless it is the other party to such merger or consolidation, shall have by a counterpart to this Agreement, as applicable, confirmed that its guarantee thereunder shall apply to any Successor Borrower’s obligations under this Agreement, (4) each Subsidiary Guarantor, unless it is the other party to such merger or consolidation, shall have by a supplement to any applicable Collateral Document affirmed that its obligations thereunder shall apply to its guarantee as reaffirmed pursuant to clause (3), (5) each mortgagor of a Mortgaged Property, unless it is the other party to such merger or consolidation, shall have affirmed that its obligations under the applicable Mortgage shall apply to its guarantee as reaffirmed pursuant to clause (3) and (6) the Successor Borrower shall have delivered to the Administrative Agent (x) an officer’s certificate stating that such merger or consolidation does not violate this Agreement or any other Loan Document and (y) if requested by the Administrative Agent, an opinion of counsel to the effect that such liquidation, dissolution, merger, amalgamation or consolidation does not violate this Agreement or any other Loan Document and covering such other matters as are contemplated by the Collateral and Guarantee Requirement to be covered in opinions of counsel (it being understood that if the foregoing are satisfied, the Successor Borrower will succeed to, and be substituted for, the Borrower under this Agreement);
(p) Dispositions in connection with the exercise of any subscriptions, options, warrants, puts, calls or other rights or commitments pursuant to agreements set forth on Schedule 3.08(b);
(q) Dispositions of property or assets (i) acquired after the Closing Date which property or assets are not used or useful to the core or principal business of the Borrower and the Subsidiaries in the good faith determination of the Borrower or (ii) that are made in connection with the approval of any applicable antitrust authority or as otherwise necessary or advisable in the good faith determination of the Borrower to consummate any Permitted Business Acquisition, New Project, Investment or other transaction; and
(r) any Disposition to effect the formation of any Subsidiary that is a Delaware Divided LLC and would otherwise not be prohibited hereunder; provided that any disposition or other allocation of any assets (including any Equity Interests of such Delaware Divided LLC) in connection therewith is otherwise permitted hereunder. Notwithstanding anything to the contrary contained in Section 6.05 above, no Disposition of assets under Section 6.05(g) or, solely with respect to Sale and Lease-Back Transactions referred to in clause (b)(y) of Section 6.03, under Section 6.05(d), shall be permitted unless (i) such Disposition is for fair market value (as determined in good faith by the Borrower), or if not for fair market value, the shortfall is permitted as an Investment under Section 6.04, and (ii) at least 75% of the proceeds of such Disposition (except to Loan Parties) consist of cash or Permitted Investments; provided, that the provisions of this clause (ii) shall not apply to any individual transaction or series of related transactions involving assets with a fair market value (as determined in good faith by the Borrower) of less than $12,500,000 or to other transactions involving assets with a fair market value (as determined in good faith by the Borrower) of not more than the greater of $85,000,000 and 0.20 times the Adjusted EBITDA calculated on a Pro Forma Basis for the then most recently ended Test Period in the aggregate for all such transactions during the term of this Agreement; provided, further, that for purposes of this clause (ii), each of the following shall be deemed to be cash: (a) the amount of any liabilities (as shown on the Borrower’s or such Subsidiary’s most recent balance sheet or in the notes thereto or, if incurred or increased subsequent to the date of such balance sheet, such liabilities that would have been shown on the Borrower’s or such Subsidiary’s balance sheet or in the notes thereto if such incurrence or increase had taken place on or prior to the date of such balance sheet, as determined by the Borrower) of the Borrower or any Subsidiary that are assumed by the transferee of any such assets (or a third party in connection with such transfer) or are otherwise cancelled or terminated in connection with such transaction, (b) any notes or other obligations or other securities or assets received by the Borrower or such Subsidiary from the transferee that are converted by the Borrower or such Subsidiary into cash within 180 days after receipt thereof (to the extent of the cash received), (c) any Designated Non-Cash Consideration received by the Borrower or any of its Subsidiaries in such Disposition having an aggregate fair market value (as determined in good faith by the Borrower), taken together with all other Designated Non-Cash Consideration received pursuant to this clause (c) that is at that time outstanding, not to exceed the greater of $165,000,000 and 0.35 times the Adjusted EBITDA calculated on a Pro Forma Basis for the Test Period ended immediately prior to the receipt of such Designated Non-Cash Consideration (with the fair market value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value), (d) the amount of Indebtedness of any Subsidiary that is no longer a Subsidiary as a result of such Asset Sale, to the extent that Holdings, the Borrower and each other Subsidiary are released from any guarantee of payment of such Indebtedness in connection with the Asset Sale and (e) consideration consisting of Indebtedness of the Borrower or a Subsidiary (other than Indebtedness that is subordinated in right of payment to the Loan Obligations) received from persons who are not Holdings, the Borrower or a Subsidiary in connection with the Asset Sale and that is cancelled or otherwise extinguished. For purposes of this Agreement, the fair market value of any assets acquired, leased, exchanged, Disposed of, sold, conveyed or transferred by the Borrower or any Subsidiary shall be determined in good faith by the Borrower and may be determined either, at the option of the Borrower, at the time of such acquisition, lease, exchange, Disposition, sale, conveyance or transfer, as applicable, or as of the date of the definitive agreement with respect to such acquisition, lease, exchange, Disposition, sale, conveyance or transfer, as applicable.
Appears in 1 contract
Mergers, Consolidations, Sales of Assets and Acquisitions. Merge into or consolidate with any other person, or permit any other person to merge into or consolidate with it, or Dispose of (in one transaction or in a series of related transactions) all or any part of its assets (whether now owned or hereafter acquired), effect any Delaware LLC Division or Dispose of any Equity Interests of any Subsidiary, or purchase, lease or otherwise acquire (in one transaction or a series of related transactions) all of the assets of any other person or division or line of business of a person, except that this Section 6.05 shall not prohibit:
(a) (i) the purchase, discount or purchase and Disposition of equipment, inventory, accounts receivable, notes receivable or other assetsthe sale of receivables pursuant to non-recourse factoring arrangements, in each case in the ordinary course of business or and consistent with past practice or industry norm norms by the Borrower or any Subsidiary or the conversion of accounts receivable to notes receivableSubsidiary, (ii) the acquisition or lease (pursuant to an operating lease) of any other asset in the ordinary course of business or consistent with past practice or industry norm by the Borrower or any Subsidiary or, with respect to operating leases, otherwise for fair market value on market terms (as determined in good faith by the Borrower), (iii) the Disposition of surplus, obsolete, damaged or worn out equipment or other property by the Borrower or any Subsidiary in the ordinary course of business or and consistent with past practice or industry norm norms or determined in good faith by the Borrower to be no longer used or useful or necessary in the operation of the business of the Borrower or any SubsidiarySubsidiary and consistent with past practice or industry norms, (iv) [reserved]assignments by the Borrower and any Subsidiary in connection with insurance arrangements of their rights and remedies under, and with respect to, any definitive agreement related to an acquisition, Investment or Disposition in respect of any breach of its representations and warranties set forth therein or (v) the Disposition of Permitted Investments in the ordinary course of business or (vi) the Disposition of property or equipment or the abandonment of Intellectual Property rights that is otherwise economically impracticable to maintainbusiness;
(b) if at the time thereof and immediately after giving effect thereto no Event of Default shall have occurred and be continuing or would result therefrom, (i) the liquidation, dissolution, merger or consolidation of any Subsidiary with or into the Borrower in a transaction in which the Borrower is the survivor or the requirements of Section 6.05(o) are otherwise complied withsurvivor, (ii) the merger or consolidation of any Subsidiary (other than the Borrower) with or into the Borrower or any other Subsidiary in a transaction in which the surviving or resulting entity is or becomes the Borrower or a Subsidiary and, in the case of each of clauses (i) and (ii), no person other than the Borrower, the Borrower or a Subsidiary receives any consideration (unless otherwise permitted by Section 6.04)Loan Party, (iii) the liquidation, dissolution or merger or consolidation of any Subsidiary (other than the Borrower) that is not a Subsidiary Loan Party with or into the Borrower or any other Subsidiary, (iv) the liquidation or dissolution or change in form of entity of the Borrower or any Subsidiary if the Borrower determines in good faith that such liquidation, dissolution or change in form is advisable or in the best interests of the Borrower and is not materially disadvantageous to the Lenders, (v) any Subsidiary (other than the Borrower) may merge or consolidate with any other person in order to effect an Investment permitted pursuant to Section 6.04 so long as as, in the case of any Subsidiary Loan Party, the continuing or surviving person shall be the Borrower or a Subsidiary Loan Party (unless otherwise permitted by Section 6.04), ) and which together with each of its Subsidiaries shall have complied with any applicable requirements of Section 5.10 or (vi) any Subsidiary (other than the Borrower) may merge or consolidate with any other person in order to effect an Asset Sale otherwise permitted pursuant to this Section 6.05;
(c) Dispositions to the Borrower or a Subsidiary (upon voluntary liquidation or otherwise); provided, that following any such Disposition of all or substantially all of the assets of the Borrower, the Borrower Dispositions by a Loan Party to a Subsidiary that is the surviving entity or the requirements of not a Subsidiary Loan Party in reliance on this clause (c) shall be made in compliance with Section 6.05(o) are otherwise complied with6.04;
(d) Sale and Lease-Back Transactions permitted by Section 6.03;
(e) (i) Investments permitted by Section 6.04, Permitted Liens and Restricted Payments permitted by Section 6.06 and (ii) any Disposition made in connection with the Transactions6.06;
(f) Dispositions of defaulted receivables in the ordinary course of business and consistent with past practice or industry norms and not as part of an accounts receivables financing transaction;
(g) other Dispositions of assets; provided, that the Net Proceeds thereof, if any, are applied in accordance with Section 2.11(b) to the extent required thereby;
(h) Permitted Business Acquisitions (including any merger, consolidation or amalgamation in order to effect a Permitted Business Acquisition); provided, that following any such merger, consolidation or amalgamation involving the Borrower, the Borrower is the surviving entity or the requirements of Section 6.05(o) are otherwise complied with;
(i) leases, assignments, licenses or subleases or sublicenses of any real or personal property in the ordinary course of business or and consistent with past practice or industry normnorms;
(j) Dispositions of inventory or equipment or Dispositions or abandonment of Intellectual Property of the Borrower and its Subsidiaries determined in good faith by the management of the Borrower to be no longer useful or necessary in the operation of the business of, or material to the conduct of the business of, the Borrower or any of the Subsidiaries;
(k) acquisitions and purchases made with the proceeds of any Asset Sale pursuant to the first proviso of clause (a) of the definition of “Net Proceeds”;
(l) the purchase and Disposition (including by capital contribution) of (i) Securitization Assets including pursuant to Permitted Securitization Financings, Financings and (ii) any other Securitization Assets subject to Liens securing Permitted Securitization Financing and (iii) receivables in connection with a receivables financingFinancing;
(m) to the extent constituting a Disposition, any termination, settlement, settlement or extinguishment or unwinding of obligations in respect of any Hedging Agreement;
(n) any exchange of assets for services and/or other assets used or useful in a Similar Business of comparable or greater value; provided, that (i) to the extent the consideration received consists of assets, at least 90100% of the consideration received by the transferor consists of assets that will be used in a business or business activity permitted hereunder, (ii) in the event of a swap with a fair market value (as determined in good faith by the Borrower) in excess of $10,000,0001,000,000, the Administrative Agent shall have received a certificate from a Responsible Officer of the Borrower with respect to such fair market value and value, (iii) in the event of a swap with a fair market value (as determined in good faith by the Borrower) in excess of $15,000,0005,000,000, such exchange shall have been approved by at least a majority of the Board of Directors of Holdings or the BorrowerBorrower and (iv) to the extent that the assets exchanged constitute Collateral for the Term B Loans, the consideration received in respect thereof shall constitute Collateral for the Term B Loans; provided, further, that no Default or Event of Default exists or would result therefrom;
(o) if at the time thereof and immediately after giving effect thereto no Event of Default shall have occurred and be continuing or would result therefrom, the Borrower, any Subsidiary or any other person may be liquidated, dissolved, merged, amalgamated or consolidated with or into the Borrower; , provided that (A) the Borrower shall be the surviving entity or (B) if the surviving entity is not the Borrower (such other person, the “Successor Borrower”), (1) the Successor Borrower shall be an entity organized or existing under the laws of the United States, any state thereof or thereof, the District of ColumbiaColumbia or any territory thereof, (2) the Successor Borrower shall expressly assume all the obligations of the Borrower under this Agreement and the other Loan Documents pursuant to a supplement hereto or thereto in form reasonably satisfactory to the Administrative Agent, (3) each Guarantor, unless it is the other party to such merger or consolidation, shall have by a counterpart supplement to this the Holdings Guarantee and Pledge Agreement or the Subsidiary Guarantee Agreement, as applicable, confirmed that its guarantee thereunder shall apply to any Successor Borrower’s obligations under this Agreement, (4) each Subsidiary GuarantorLoan Party, unless it is the other party to such merger or consolidation, shall have by a supplement to any applicable Collateral Security Document affirmed that its obligations thereunder shall apply to its guarantee as reaffirmed pursuant to clause (3), (5) each mortgagor of a Mortgaged Property, unless it is the other party to such merger or consolidation, shall have affirmed that its obligations under the applicable Mortgage shall apply to its guarantee as reaffirmed pursuant to clause (3) and (6) the Successor Borrower shall have delivered to the Administrative Agent (x) an officer’s certificate stating that such merger or consolidation does not violate this Agreement or any other Loan Document and (y) if requested by the Administrative Agent, an opinion of counsel to the effect that such liquidation, dissolution, merger, amalgamation merger or consolidation does not violate this Agreement or any other Loan Document and covering such other matters as are contemplated by the Collateral and Guarantee Requirement to be covered in opinions of counsel (it being understood that if the foregoing are satisfied, the Successor Borrower Xxxxxxxx will succeed to, and be substituted for, the Borrower under this Agreement);
(p) Dispositions in connection with the exercise of any subscriptions, options, warrants, puts, calls or other rights or commitments pursuant to agreements set forth on Schedule 3.08(b);
(q) Dispositions of property or assets (i) acquired after the Closing Date which property or assets are not used or useful to the core or principal business of the Borrower and the Subsidiaries in the good faith determination of the Borrower or (ii) that are made in connection with the approval of any applicable antitrust authority or as otherwise necessary or advisable in the good faith determination of the Borrower to consummate any Permitted Business Acquisition, New Project, Investment or other transaction; and
(rp) any Disposition to effect the formation of any Subsidiary that is a Delaware Divided LLC and would otherwise not be prohibited hereunder; provided that any disposition or other allocation of any assets (including any Equity Interests of such Delaware Divided LLC) in connection therewith is otherwise permitted hereunder; provided, further, that any Subsidiary formed as a result of a Delaware LLC Division from a Subsidiary Loan Party shall also be a Subsidiary Loan Party (unless otherwise permitted by Section 6.04). Notwithstanding anything to the contrary contained in Section 6.05 above, no Disposition of assets under Section 6.05(g) or, solely with respect to Sale and Lease-Back Transactions referred to in clause (b)(y) of Section 6.03, under Section 6.05(d), shall be permitted unless (i) such Disposition is for fair market value (as determined in good faith by the Borrower), or if not for fair market value, the shortfall is permitted as an Investment under Section 6.04, and (ii) at least 75% of the proceeds of such Disposition (except to Loan Parties) consist of cash or Permitted Investments; provided, that the provisions of this clause (ii) shall not apply to any individual transaction or series of related transactions involving assets with a fair market value (as determined in good faith by the Borrower) of less than $12,500,000 5,000,000 or to other transactions involving assets with a fair market value (as determined in good faith by the Borrower) of not more than the greater of $85,000,000 and 0.20 times the Adjusted EBITDA calculated on a Pro Forma Basis for the then most recently ended Test Period 15,000,000 in the aggregate for all such transactions during the term of this Agreement; provided, further, that for purposes of this clause (ii), each of the following shall be deemed to be cash: (a) the amount of any liabilities (as shown on the Borrower’s or such Subsidiary’s most recent balance sheet or in the notes thereto or, if incurred or increased subsequent to the date of such balance sheet, such liabilities that would have been shown on the Borrower’s or such Subsidiary’s balance sheet or in the notes thereto if such incurrence or increase had taken place on or prior to the date of such balance sheet, as determined by the Borrowerthereto) of the Borrower or any Subsidiary that are assumed by the transferee of any such assets (or a third party in connection with such transfer) or are otherwise cancelled or terminated in connection with such transaction, (b) any notes or other obligations or other securities or assets received by the Borrower or such Subsidiary from the transferee that are converted by the Borrower or such Subsidiary into cash within 180 days after receipt thereof (to the extent of the cash received), (c) any Designated Non-Cash Consideration received by the Borrower or any of its Subsidiaries in such Disposition having an aggregate fair market value (as determined in good faith by the Borrower), taken together with all other Designated Non-Cash Consideration received pursuant to this clause (c) that is at that time outstanding, not to exceed the greater of $165,000,000 and 0.35 times the Adjusted EBITDA calculated on a Pro Forma Basis for the Test Period ended immediately prior to the receipt of such Designated Non-Cash Consideration (with the fair market value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value)[reserved], (d) the amount of Indebtedness of any Subsidiary that is no longer a Subsidiary as a result of such Asset Sale, to the extent that Holdings, the Borrower and each other Subsidiary are released from any guarantee of payment of such Indebtedness in connection with the Asset Sale and (e) consideration consisting of Indebtedness of the Borrower or a Subsidiary (other than Indebtedness that is subordinated in right of payment to the Loan Obligations) received from persons who are not Holdings, the Borrower or a Subsidiary in connection with the Asset Sale and that is cancelled or otherwise extinguishedcancelled. For purposes of this AgreementSection 6.05, the fair market value of any assets acquired, leased, exchanged, Disposed of, sold, conveyed or transferred of by the Borrower or any Subsidiary shall be determined in good faith by the Borrower and may be determined either, at the option of the Borrower, at the time of such acquisition, lease, exchange, Disposition, sale, conveyance or transfer, as applicable, Disposition or as of the date of the definitive agreement with respect to such acquisition, lease, exchange, Disposition, sale, conveyance or transfer, as applicable.
Appears in 1 contract
Samples: First Lien Credit Agreement (Rackspace Technology, Inc.)
Mergers, Consolidations, Sales of Assets and Acquisitions. Merge into or consolidate with any other person, or permit any other person to merge into or consolidate with it, or Dispose of (in one transaction or in a series of related transactions) all or any part of its assets (whether now owned or hereafter acquired), effect any Delaware LLC Division or Dispose of any Equity Interests of any Subsidiary, or purchase, lease or otherwise acquire (in one transaction or a series of related transactions) all of the assets of any other person or division or line of business of a person, except that this Section 6.05 shall not prohibit:
(a) (i) the purchase, discount or Disposition of equipment, inventory, accounts receivable, notes receivable or other assets, in each case in the ordinary course of business or consistent with past practice or industry norm by the Borrower or any Subsidiary or the conversion of accounts receivable to notes receivable, (ii) the acquisition or lease (pursuant to an operating lease) of any other asset in the ordinary course of business or consistent with past practice or industry norm by the Borrower or any Subsidiary or, with respect to operating leases, otherwise for fair market value on market terms (as determined in good faith by the Borrower), (iii) the Disposition of surplus, obsolete, damaged or worn out equipment or other property by the Borrower or any Subsidiary in the ordinary course of business or consistent with past practice or industry norm or determined in good faith by the Borrower to be no longer used or useful or necessary in the operation of the business of the Borrower or any Subsidiary, (iv) [reserved], (v) the Disposition of Permitted Investments in the ordinary course of business or (vi) the Disposition of property or equipment or the abandonment of Intellectual Property rights that is otherwise economically impracticable to maintain;
(b) if at the time thereof and immediately after giving effect thereto no Event of Default shall have occurred and be continuing or would result therefrom, (i) the liquidation, dissolution, merger or consolidation of any Subsidiary with or into the Borrower in a transaction in which the Borrower is the survivor or the requirements of Section 6.05(o) are otherwise complied with, (ii) the merger or consolidation of any Subsidiary (other than the Borrower) with or into the Borrower or any other Subsidiary in a transaction in which the surviving or resulting entity is or becomes the Borrower or a Subsidiary and, in the case of each of clauses (i) and (ii), no person other than the Borrower, the Borrower or a Subsidiary receives any consideration (unless otherwise permitted by Section 6.04), (iii) the liquidation, dissolution or merger or consolidation of any Subsidiary (other than the Borrower) with or into the Borrower or any other Subsidiary, (iv) the change in form of entity of the Borrower or any Subsidiary if the Borrower determines in good faith that such change in form is advisable or in the best interests of the Borrower and is not materially disadvantageous to the Lenders, (v) any Subsidiary (other than the Borrower) may merge or consolidate with any other person in order to effect an Investment permitted pursuant to Section 6.04 so long as the continuing or surviving person shall be the Borrower or a Subsidiary (unless otherwise permitted by Section 6.04), and which together with each of its Subsidiaries shall have complied with any applicable requirements of Section 5.10 or (vi) any Subsidiary (other than the Borrower) may merge or consolidate with any other person in order to effect an Asset Sale otherwise permitted pursuant to this Section 6.05;
(c) Dispositions to the Borrower or a Subsidiary (upon voluntary liquidation or otherwise); provided, that following any such Disposition of all or substantially all of the assets of the Borrower, the Borrower is the surviving entity or the requirements of Section 6.05(o) are otherwise complied with;
(d) Sale and Lease-Back Transactions permitted by Section 6.03;
(e) (i) Investments permitted by Section 6.04, Permitted Liens and Restricted Payments permitted by Section 6.06 and (ii) any Disposition made in connection with the Transactions;
(f) Dispositions of defaulted receivables in the ordinary course of business and not as part of an accounts receivables financing transaction;
(g) other Dispositions of assets; provided, that the Net Proceeds thereof, if any, are applied in accordance with Section 2.11(b) to the extent required thereby;
(h) Permitted Business Acquisitions (including any merger, consolidation or amalgamation in order to effect a Permitted Business Acquisition); provided, that following any such merger, consolidation or amalgamation involving the Borrower, the Borrower is the surviving entity or the requirements of Section 6.05(o) are otherwise complied with;
(i) leases, assignments, licenses or subleases or sublicenses of any real or personal property in the ordinary course of business or consistent with past practice or industry norm;
(j) Dispositions of inventory or equipment or Dispositions or abandonment of Intellectual Property of the Borrower and its Subsidiaries determined in good faith by the management of the Borrower to be no longer useful or necessary in the operation of the business of, or material to the conduct of the business of, the Borrower or any of the Subsidiaries;
(k) acquisitions and purchases made with the proceeds of any Asset Sale pursuant to the first proviso of clause (a) of the definition of “Net Proceeds”;
(l) the purchase and Disposition (including by capital contribution) of (i) Securitization Assets including pursuant to Permitted Securitization Financings, (ii) any other Securitization Assets subject to Liens securing Permitted Securitization Financing and (iii) receivables in connection with a receivables financing;
(m) to the extent constituting a Disposition, any termination, settlement, extinguishment or unwinding of obligations in respect of any Hedging Agreement;
(n) any exchange of assets for services and/or other assets used or useful in a Similar Business of comparable or greater value; provided, that (i) to the extent the consideration received consists of assets, at least 90% of the consideration received by the transferor consists of assets that will be used in a business or business activity permitted hereunder, (ii) in the event of a swap with a fair market value (as determined in good faith by the Borrower) in excess of $10,000,000, the Administrative Agent shall have received a certificate from a Responsible Officer of the Borrower with respect to such fair market value and (iii) in the event of a swap with a fair market value (as determined in good faith by the Borrower) in excess of $15,000,000, such exchange shall have been approved by at least a majority of the Board of Directors of Holdings or the Borrower;
(o) if at the time thereof and immediately after giving effect thereto no Event of Default shall have occurred and be continuing or would result therefrom, the Borrower, any Subsidiary or any other person may be liquidated, dissolved, merged, amalgamated or consolidated with or into the Borrower; provided that (A) the Borrower shall be the surviving entity or (B) if the surviving entity is not the Borrower (such other person, the “Successor Borrower”), (1) the Successor Borrower shall be an entity organized or existing under the laws of the United States, any state thereof or the District of Columbia, (2) the Successor Borrower shall expressly assume all the obligations of the Borrower under this Agreement and the other Loan Documents pursuant to a supplement hereto or thereto in form reasonably satisfactory to the Administrative Agent, (3) each Guarantor, unless it is the other party to such merger or consolidation, shall have by a counterpart to this Agreement, as applicable, confirmed that its guarantee thereunder shall apply to any Successor Borrower’s obligations under this Agreement, (4) each Subsidiary Guarantor, unless it is the other party to such merger or consolidation, shall have by a supplement to any applicable Collateral Document affirmed that its obligations thereunder shall apply to its guarantee as reaffirmed pursuant to clause (3), (5) each mortgagor of a Mortgaged Property, unless it is the other party to such merger or consolidation, shall have affirmed that its obligations under the applicable Mortgage shall apply to its guarantee as reaffirmed pursuant to clause (3) and (6) the Successor Borrower shall have delivered to the Administrative Agent (x) an officer’s certificate stating that such merger or consolidation does not violate this Agreement or any other Loan Document and (y) if requested by the Administrative Agent, an opinion of counsel to the effect that such liquidation, dissolution, merger, amalgamation or consolidation does not violate this Agreement or any other Loan Document and covering such other matters as are contemplated by the Collateral and Guarantee Requirement to be covered in opinions of counsel (it being understood that if the foregoing are satisfied, the Successor Borrower will succeed to, and be substituted for, the Borrower under this Agreement);
(p) Dispositions in connection with the exercise of any subscriptions, options, warrants, puts, calls or other rights or commitments pursuant to agreements set forth on Schedule 3.08(b);
(q) Dispositions of property or assets (i) acquired after the Closing Date which property or assets are not used or useful to the core or principal business of the Borrower and the Subsidiaries in the good faith determination of the Borrower or (ii) that are made in connection with the approval of any applicable antitrust authority or as otherwise necessary or advisable in the good faith determination of the Borrower to consummate any Permitted Business Acquisition, New Project, Investment or other transaction; and
(r) any Disposition to effect the formation of any Subsidiary that is a Delaware Divided LLC and would otherwise not be prohibited hereunder; provided that any disposition or other allocation of any assets (including any Equity Interests of such Delaware Divided LLC) in connection therewith is otherwise permitted hereunder. Notwithstanding anything to the contrary contained in Section 6.05 above, no Disposition of assets under Section 6.05(g) or, solely with respect to Sale and Lease-Back Transactions referred to in clause (b)(y) of Section 6.03, under Section 6.05(d), shall be permitted unless (i) such Disposition is for fair market value (as determined in good faith by the Borrower), or if not for fair market value, the shortfall is permitted as an Investment under Section 6.04, and (ii) at least 75% of the proceeds of such Disposition (except to Loan Parties) consist of cash or Permitted Investments; provided, that the provisions of this clause (ii) shall not apply to any individual transaction or series of related transactions involving assets with a fair market value (as determined in good faith by the Borrower) of less than $12,500,000 or to other transactions involving assets with a fair market value (as determined in good faith by the Borrower) of not more than the greater of $85,000,000 and 0.20 times the Adjusted EBITDA calculated on a Pro Forma Basis for the then most recently ended Test Period in the aggregate for all such transactions during the term of this Agreement; provided, further, that for purposes of this clause (ii), each of the following shall be deemed to be cash: (a) the amount of any liabilities (as shown on the Borrower’s or such Subsidiary’s most recent balance sheet or in the notes thereto or, if incurred or increased subsequent to the date of such balance sheet, such liabilities that would have been shown on the Borrower’s or such Subsidiary’s balance sheet or in the notes thereto if such incurrence or increase had taken place on or prior to the date of such balance sheet, as determined by the Borrower) of the Borrower or any Subsidiary that are assumed by the transferee of any such assets (or a third party in connection with such transfer) or are otherwise cancelled or terminated in connection with such transaction, (b) any notes or other obligations or other securities or assets received by the Borrower or such Subsidiary from the transferee that are converted by the Borrower or such Subsidiary into cash within 180 days after receipt thereof (to the extent of the cash received), (c) any Designated Non-Cash Consideration received by the Borrower or any of its Subsidiaries in such Disposition having an aggregate fair market value (as determined in good faith by the Borrower), taken together with all other Designated Non-Cash Consideration received pursuant to this clause (c) that is at that time outstanding, not to exceed the greater of $165,000,000 and 0.35 times the Adjusted EBITDA calculated on a Pro Forma Basis for the Test Period ended immediately prior to the receipt of such Designated Non-Cash Consideration (with the fair market value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value), (d) the amount of Indebtedness of any Subsidiary that is no longer a Subsidiary as a result of such Asset Sale, to the extent that Holdings, the Borrower and each other Subsidiary are released from any guarantee of payment of such Indebtedness in connection with the Asset Sale and (e) consideration consisting of Indebtedness of the Borrower or a Subsidiary (other than Indebtedness that is subordinated in right of payment to the Loan Obligations) received from persons who are not Holdings, the Borrower or a Subsidiary in connection with the Asset Sale and that is cancelled or otherwise extinguished. For purposes of this Agreement, the fair market value of any assets acquired, leased, exchanged, Disposed of, sold, conveyed or transferred by the Borrower or any Subsidiary shall be determined in good faith by the Borrower and may be determined either, at the option of the Borrower, at the time of such acquisition, lease, exchange, Disposition, sale, conveyance or transfer, as applicable, or as of the date of the definitive agreement with respect to such acquisition, lease, exchange, Disposition, sale, conveyance or transfer, as applicable.
Appears in 1 contract
Mergers, Consolidations, Sales of Assets and Acquisitions. Merge into or consolidate with any other person, or permit any other person to merge into or consolidate with it, or Dispose of (in one transaction or in a series of related transactions) all or any part of its assets (whether now owned or hereafter acquired), effect any Delaware LLC Division or Dispose of any Equity Interests of any Subsidiary, or purchase, lease or otherwise acquire (in one transaction or a series of related transactions) all of the assets of any other person or division or line of business of a person, except that this Section 6.05 shall not prohibit:
(a) (i) the purchase, discount or Disposition of equipment, inventory, accounts receivable, notes receivable or other assets, in each case in the ordinary course of business or consistent with past practice or industry norm by the Borrower or any Subsidiary or the conversion of accounts receivable to notes receivable, (ii) the acquisition or lease (pursuant to an operating lease) of any other asset in the ordinary course of business or consistent with past practice or industry norm by the Borrower or any Subsidiary or, with respect to operating leases, otherwise for fair market value on market terms (as determined in good faith by the Borrower), (iii) the Disposition of surplus, obsolete, damaged or worn out equipment or other property by the Borrower or any Subsidiary in the ordinary course of business or consistent with past practice or industry norm or determined in good faith by the Borrower to be no longer used or useful or necessary in the operation of the business of the Borrower or any Subsidiary, (iv) [reserved], (v) the Disposition of Permitted Investments in the ordinary course of business or (vi) the Disposition of property or equipment or the abandonment of Intellectual Property rights that is otherwise economically impracticable to maintain;
(b) if at the time thereof and immediately after giving effect thereto no Event of Default shall have occurred and be continuing or would result therefrom, (i) the liquidation, dissolution, merger or consolidation of any Subsidiary with or into the Borrower in a transaction in which the Borrower is the survivor or the requirements of Section 6.05(o) are otherwise complied with, (ii) the merger or consolidation of any Subsidiary (other than the Borrower) with or into the Borrower or any other Subsidiary in a transaction in which the surviving or resulting entity is or becomes the Borrower or a Subsidiary and, in the case of each of clauses (i) and (ii), no person other than the Borrower, the Borrower or a Subsidiary receives any consideration (unless otherwise permitted by Section 6.04), (iii) the liquidation, dissolution or merger or consolidation of any Subsidiary (other than the Borrower) with or into the Borrower or any other Subsidiary, (iv) the change in form of entity of the Borrower or any Subsidiary if the Borrower determines in good faith that such change in form is advisable or in the best interests of the Borrower and is not materially disadvantageous to the Lenders, (v) any Subsidiary (other than the Borrower) may merge or consolidate with any other person in order to effect an Investment permitted pursuant to Section 6.04 so long as the continuing or surviving person shall be the Borrower or a Subsidiary (unless otherwise permitted by Section 6.04), and which together with each of its Subsidiaries shall have complied with any applicable requirements of Section 5.10 or (vi) any Subsidiary (other than the Borrower) may merge or consolidate with any other person in order to effect an Asset Sale otherwise permitted pursuant to this Section 6.05;
(c) Dispositions to the Borrower or a Subsidiary (upon voluntary liquidation or otherwise); provided, that following any such Disposition of all or substantially all of the assets of the Borrower, the Borrower is the surviving entity or the requirements of Section 6.05(o) are otherwise complied with;
(d) Sale and Lease-Back Transactions permitted by Section 6.03;
(e) (i) Investments permitted by Section 6.04, Permitted Liens permitted by Section 6.02 and Restricted Payments permitted by Section 6.06 and (ii) any Disposition made in connection with the Transactions6.06;
(f) Dispositions of defaulted receivables in the ordinary course of business and not as part of an accounts receivables financing transaction;
(g) other Dispositions of assets; provided, that the Net Proceeds thereof, if any, are applied in accordance with Section 2.11(b) to the extent required thereby;
(h) Permitted Business Acquisitions (including any merger, consolidation or amalgamation in order to effect a Permitted Business Acquisition); provided, that following any such merger, consolidation or amalgamation involving the Borrower, the Borrower is the surviving entity or the requirements of Section 6.05(o) are otherwise complied with;
(i) leases, assignments, licenses or subleases or sublicenses of any real or personal property in the ordinary course of business or consistent with past practice or industry norm;
(j) Dispositions of inventory or equipment or Dispositions or abandonment of Intellectual Property of the Borrower and its Subsidiaries determined in good faith by the management of the Borrower to be no longer useful or necessary in the operation of the business of, or material to the conduct of the business of, the Borrower or any of the Subsidiaries;
(k) acquisitions and purchases made with the proceeds of any Asset Sale pursuant to the first proviso of clause (a) of the definition of “Net Proceeds”;[reserved]
(l) the purchase and Disposition (including by capital contribution) of (i) Securitization Assets including pursuant to Permitted Securitization Financings, (ii) any other Securitization Assets subject to Liens securing Permitted Securitization Financing and (iii) receivables Receivables Assets in connection with a receivables factoring or financing;
(m) to the extent constituting a Disposition, any termination, settlement, extinguishment or unwinding of obligations in respect of any Hedging Agreement;
(n) any exchange of assets for services and/or other assets used or useful in a Similar Business of comparable or greater value; provided, that (i) to the extent the consideration received consists of assets, at least 90% of the consideration received by the transferor consists of assets that will be used in a business or business activity permitted hereunder, (ii) in the event of a swap with a fair market value (as determined in good faith by the Borrower) in excess of $10,000,000, the Administrative Agent shall have received a certificate from a Responsible Officer of the Borrower with respect to such fair market value and (iii) in the event of a swap with a fair market value (as determined in good faith by the Borrower) in excess of $15,000,000, such exchange shall have been approved by at least a majority of the Board of Directors of Holdings or the Borrower;
(o) if at the time thereof and immediately after giving effect thereto no Event of Default shall have occurred and be continuing or would result therefrom, the Borrower, any Subsidiary or any other person may be liquidated, dissolved, merged, amalgamated or consolidated with or into the Borrower; provided that (A) the Borrower shall be the surviving entity or (B) if the surviving entity is not the Borrower (such other person, the “Successor Borrower”), (1) the Successor Borrower shall be an entity organized or existing under the laws of the United States, any state thereof or the District of Columbia, (2) the Successor Borrower shall expressly assume all the obligations of the Borrower under this Agreement and the other Loan Documents pursuant to a supplement hereto or thereto in form reasonably satisfactory to the Administrative Agent, (3) each Guarantor, unless it is the other party to such merger or consolidation, shall have by a counterpart to this Agreement, as applicable, confirmed that its guarantee thereunder shall apply to any Successor Borrower’s obligations under this Agreement, (4) each Subsidiary Guarantor, unless it is the other party to such merger or consolidation, shall have by a supplement to any applicable Collateral Document affirmed that its obligations thereunder shall apply to its guarantee as reaffirmed pursuant to clause (3), (5) each mortgagor of a Mortgaged Property), unless it is the other party to such merger or consolidation, shall have affirmed that its obligations under the applicable Mortgage shall apply to its guarantee as reaffirmed pursuant to clause (3) [reserved] and (6) the Successor Borrower shall have delivered to the Administrative Agent (x) an officer’s certificate stating that such merger or consolidation does not violate this Agreement or any other Loan Document and (y) if requested by the Administrative Agent, an opinion of counsel to the effect that such liquidation, dissolution, merger, amalgamation or consolidation does not violate this Agreement or any other Loan Document and covering such other matters as are contemplated by the Collateral and Guarantee Requirement to be covered in opinions of counsel (it being understood that if the foregoing are satisfied, the Successor Borrower Bxxxxxxx will succeed to, and be substituted for, the Borrower under this Agreement);
(p) Dispositions in connection with the exercise of any subscriptions, options, warrants, puts, calls or other rights or commitments pursuant to agreements set forth on Schedule 3.08(b);
(q) Dispositions of property or assets (i) acquired after the Closing Date which property or assets are not used or useful to the core or principal business of the Borrower and the Subsidiaries in the good faith determination of the Borrower or (ii) that are made in connection with the approval of any applicable antitrust authority or as otherwise necessary or advisable in the good faith determination of the Borrower to consummate any Permitted Business Acquisition, New Project, Investment or other transaction; and;
(r) any Disposition to effect the formation of any Subsidiary that is a Delaware Divided LLC and would otherwise not be prohibited hereunder; provided that any disposition or other allocation of any assets (including any Equity Interests of such Delaware Divided LLC) in connection therewith is otherwise permitted hereunder; and
(s) the consummation of the Merger pursuant to, and in accordance with the requirements of, the Merger Agreement. Notwithstanding anything to the contrary contained in Section 6.05 above, no Disposition of assets under Section 6.05(g) or, solely with respect to Sale and Lease-Back Transactions referred to in clause (b)(y) of Section 6.03, under Section 6.05(d), shall be permitted unless (i) such Disposition is for fair market value (as determined in good faith by the Borrower), or if not for fair market value, the shortfall is permitted as an Investment under Section 6.046.04 (and reduces the applicable Investment basket on a dollar-for-dollar basis), and (ii) at least 75% of the proceeds of such Disposition (except to Loan Parties) consist of cash or Permitted Investments; provided, that the provisions of this clause (ii) shall not apply to any individual transaction or series of related transactions involving assets with a fair market value (as determined in good faith by the Borrower) of less than $12,500,000 or to other transactions involving assets with a fair market value (as determined in good faith by the Borrower) of not more than the greater of $85,000,000 107,000,000 and 0.20 times the Adjusted EBITDA calculated on a Pro Forma Basis for the then most recently ended Test Period in the aggregate for all such transactions during the term of this Agreement; provided, further, that for purposes of this clause (ii), each of the following shall be deemed to be cash: (a) the amount of any liabilities (as shown on the Borrower’s or such Subsidiary’s most recent balance sheet or in the notes thereto or, if incurred or increased subsequent to the date of such balance sheet, such liabilities that would have been shown on the Borrower’s or such any Subsidiary’s balance sheet or in the notes thereto if such incurrence or increase had taken place on or prior to the date of such balance sheet, as determined by the Borrower) of the Borrower or any Subsidiary that are assumed by the transferee of any such assets (or a third party in connection with such transfer) or are otherwise cancelled or terminated in connection with such transaction, (b) any notes or other obligations or other securities or assets received by the Borrower or such any Subsidiary from the transferee that are converted by the Borrower or such any Subsidiary into cash within 180 days after receipt thereof (to the extent of the cash received), (c) any Designated Non-Cash Consideration received by the Borrower or any of its Subsidiaries in such Disposition having an aggregate fair market value (as determined in good faith by the Borrower), taken together with all other Designated Non-Cash Consideration received pursuant to this clause (c) that is at that time outstanding, not to exceed the greater of $165,000,000 187,000,000 and 0.35 times the Adjusted EBITDA calculated on a Pro Forma Basis for the Test Period ended immediately prior to the receipt of such Designated Non-Cash Consideration (with the fair market value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value), (d) the amount of Indebtedness of any Subsidiary that is no longer a Subsidiary as a result of such Asset Sale, to the extent that Holdings, the Borrower and each other Subsidiary are released from any guarantee of payment of such Indebtedness in connection with the Asset Sale and (e) consideration consisting of Indebtedness of the Borrower or a Subsidiary (other than Indebtedness that is subordinated in right of payment to the Loan Obligations) received from persons who are not Holdings, the Borrower or a Subsidiary in connection with the Asset Sale and that is cancelled or otherwise extinguished. Notwithstanding the foregoing, the Borrower shall not, nor shall it permit any Subsidiary to, (x) transfer (including by way of sale, investment, exclusive license or designation of a Subsidiary as an Unrestricted Subsidiary) any Intellectual Property that is material to the business of the Borrower and the Subsidiaries taken as a whole to any Unrestricted Subsidiary and (y) transfer legal or beneficial ownership of, or an exclusive license to, any Intellectual Property that is material to the business of the Borrower and the Subsidiaries taken as a whole to any Unrestricted Subsidiary to Holdings or any Subsidiary that is not a Loan Party (including by way of sale or investment). For purposes of this Agreement, the fair market value of any assets acquired, leased, exchanged, Disposed of, sold, conveyed or transferred by the Borrower or any Subsidiary shall be determined in good faith by the Borrower and may be determined either, at the option of the Borrower, at the time of such acquisition, lease, exchange, Disposition, sale, conveyance or transfer, as applicable, or as of the date of the definitive agreement with respect to such acquisition, lease, exchange, Disposition, sale, conveyance or transfer, as applicable.
Appears in 1 contract
Samples: Credit Agreement (Dave & Buster's Entertainment, Inc.)
Mergers, Consolidations, Sales of Assets and Acquisitions. Merge into or consolidate with any other person, or permit any other person to merge into or consolidate with it, or Dispose of (in one transaction or in a series of related transactions) all or any part of its assets (whether now owned or hereafter acquired), effect any Delaware LLC Division or Dispose of any Equity Interests of any Subsidiary, or purchase, lease or otherwise acquire (in one transaction or a series of related transactions) all of the assets of any other person or division or line of business of a person, except that this Section 6.05 shall not prohibit:
(a) (i) the purchase, discount or Disposition of equipment, inventory, accounts receivable, notes receivable or other assets, in each case in the ordinary course of business or consistent with past practice or industry norm by the Borrower Agent or any Subsidiary or the conversion of accounts receivable to notes receivable, (ii) the acquisition or lease (pursuant to an operating lease) of any other asset in the ordinary course of business or consistent with past practice or industry norm by the Borrower Agent or any Subsidiary or, with respect to operating leases, otherwise for fair market value on market terms (as determined in good faith by the BorrowerBorrower Agent), (iii) the Disposition of surplus, obsolete, damaged or worn out equipment or other property by the Borrower Agent or any Subsidiary in the ordinary course of business or consistent with past practice or industry norm or determined in good faith by the Borrower Agent to be no longer used or useful or necessary in the operation of the business of the Borrower Agent or any Subsidiary, (iv) [reserved], (v) the Disposition of Permitted Investments in the ordinary course of business or (vi) the Disposition of property or equipment or the abandonment of Intellectual Property rights that is otherwise economically impracticable to maintain;
(b) if at the time thereof and immediately after giving effect thereto no Event of Default shall have occurred and be continuing or would result therefrom, (i) the liquidation, dissolution, merger or consolidation of any Subsidiary (other than the Borrower Agent) with or into the theany Borrower in a transaction in which the thea Borrower is the survivor or the requirements of Section 6.05(o) are otherwise complied with, (ii) the merger or consolidation of any Subsidiary (other than the BorrowerBorrower Agent) with or into the theany Borrower or any other Subsidiary in a transaction in which the surviving or resulting entity is or becomes thea Borrower or, a Subsidiary or, in the case of any merger or consolidation with or into the Borrower or a Subsidiary Agent, the Borrower Agent and, in the case of each of clauses (i) and (ii), no person other than the Borrower, the thea Borrower or a Subsidiary receives any consideration (unless otherwise permitted by Section 6.04), (iii) the liquidation, dissolution or merger or consolidation of any Subsidiary (other than the BorrowerBorrower Agent) with or into the theany Borrower or any other Subsidiary, (iv) the change in form of entity of the theany Borrower or any Subsidiary if the Borrower Agent determines in good faith that such change in form is advisable or in the best interests of the Borrower Borrowers and is not materially disadvantageous to the Lenders, (v) any Subsidiary (other than the BorrowerBorrower Agent) may merge or consolidate with any other person in order to effect an Investment permitted pursuant to Section 6.04 so long as the continuing or surviving person shall be thea Borrower or, a Subsidiary or, in the case of any merger or consolidation with or into the Borrower or a Subsidiary Agent, the Borrower Agent (unless otherwise permitted by Section 6.04), and which together with each of its Subsidiaries shall have complied with any applicable requirements of Section 5.10 or (vi) any Subsidiary (other than the BorrowerBorrower Agent) may merge or consolidate with any other person in order to effect an Asset Sale otherwise permitted pursuant to this Section 6.05;
(c) Dispositions to the Borrower Agent or a Subsidiary (upon voluntary liquidation or otherwise); provided, that following any such Disposition of all or substantially all of the assets of the BorrowerBorrower Agent, the Borrower Agent is the surviving entity or the requirements of Section 6.05(o) are otherwise complied with;
(d) Sale and Lease-Back Transactions permitted by Section 6.03;
(e) (i) Investments permitted by Section 6.04, Permitted Liens permitted by Section 6.02 and Restricted Payments permitted by Section 6.06 and (ii) any Disposition made in connection with the Transactions6.06;
(f) Dispositions of defaulted receivables in the ordinary course of business and not as part of an accounts receivables financing transaction;
(g) other Dispositions of assets; provided, that the Net Proceeds thereof, if any, are applied in accordance with Section 2.11(b) to the extent required thereby;
(h) Permitted Business Acquisitions (including any merger, consolidation or amalgamation in order to effect a Permitted Business Acquisition); provided, that following any such merger, consolidation or amalgamation involving the BorrowerBorrower Agent, the Borrower Agent is the surviving entity or the requirements of Section 6.05(o) are otherwise complied with;
(i) leases, assignments, licenses or subleases or sublicenses of any real or personal property in the ordinary course of business or consistent with past practice or industry norm;
(j) Dispositions of inventory or equipment or Dispositions or abandonment of Intellectual Property of the Borrower Agent and its Subsidiaries determined in good faith by the management of the Borrower Agent to be no longer useful or necessary in the operation of the business of, or material to the conduct of the business of, the Borrower Agent or any of the Subsidiaries;
(k) acquisitions and purchases made with the proceeds of any Asset Sale pursuant to the first proviso of clause (a) of the definition of “Net Proceeds”;[reserved]
(l) the purchase and Disposition (including by capital contribution) of (i) Securitization Assets including pursuant to Permitted Securitization Financings, (ii) any other Securitization Assets subject to Liens securing Permitted Securitization Financing and (iii) receivables Receivables Assets in connection with a receivables factoring or financing;
(m) to the extent constituting a Disposition, any termination, settlement, extinguishment or unwinding of obligations in respect of any Hedging Agreement;
(n) any exchange of assets for services and/or other assets used or useful in a Similar Business of comparable or greater value; provided, that (i) to the extent the consideration received consists of assets, at least 90% of the consideration received by the transferor consists of assets that will be used in a business or business activity permitted hereunder, (ii) in the event of a swap with a fair market value (as determined in good faith by the BorrowerBorrower Agent) in excess of $10,000,000, the Administrative Agent shall have received a certificate from a Responsible Officer of the Borrower Agent with respect to such fair market value and (iii) in the event of a swap with a fair market value (as determined in good faith by the BorrowerBorrower Agent) in excess of $15,000,000, such exchange shall have been approved by at least a majority of the Board of Directors of Holdings or the BorrowerBorrower Agent;
(o) if at the time thereof and immediately after giving effect thereto no Event of Default shall have occurred and be continuing or would result therefrom, the Borrower, any Subsidiary or any other person may be liquidated, dissolved, merged, amalgamated or consolidated with or into the BorrowerBorrower Agent; provided that (A) the Borrower Agent shall be the surviving entity or (B) if the surviving entity is not the Borrower Agent (such other person, the “Successor Borrower”), (1) the Successor Borrower shall be an entity organized or existing under the laws of the United States, any state thereof or the District of Columbia, (2) the Successor Borrower shall expressly assume all the obligations of the Borrower Agent under this Agreement and the other Loan Documents pursuant to a supplement hereto or thereto in form reasonably satisfactory to the Administrative Agent, (3) each Guarantor, unless it is the other party to such merger or consolidation, shall have by a counterpart to this Agreement, as applicable, confirmed that its guarantee thereunder shall apply to any Successor Borrower’s obligations under this Agreement, (4) each Subsidiary Guarantor, unless it is the other party to such merger or consolidation, shall have by a supplement to any applicable Collateral Document affirmed that its obligations thereunder shall apply to its guarantee as reaffirmed pursuant to clause (3), (5) each mortgagor of a Mortgaged Property), unless it is the other party to such merger or consolidation, shall have affirmed that its obligations under the applicable Mortgage shall apply to its guarantee as reaffirmed pursuant to clause (3) [reserved] and (6) the Successor Borrower shall have delivered to the Administrative Agent (x) an officer’s certificate stating that such merger or consolidation does not violate this Agreement or any other Loan Document and (y) if requested by the Administrative Agent, an opinion of counsel to the effect that such liquidation, dissolution, merger, amalgamation or consolidation does not violate this Agreement or any other Loan Document and covering such other matters as are contemplated by the Collateral and Guarantee Requirement to be covered in opinions of counsel (it being understood that if the foregoing are satisfied, the Successor Borrower Bxxxxxxx will succeed to, and be substituted for, the Borrower Agent under this Agreement);
(p) Dispositions in connection with the exercise of any subscriptions, options, warrants, puts, calls or other rights or commitments pursuant to agreements set forth on Schedule 3.08(b);
(q) Dispositions of property or assets (i) acquired after the Closing Date which property or assets are not used or useful to the core or principal business of the Borrower Agent and the Subsidiaries in the good faith determination of the Borrower Agent or (ii) that are made in connection with the approval of any applicable antitrust authority or as otherwise necessary or advisable in the good faith determination of the Borrower Agent to consummate any Permitted Business Acquisition, New Project, Investment or other transaction; and;
(r) any Disposition to effect the formation of any Subsidiary that is a Delaware Divided LLC and would otherwise not be prohibited hereunder; provided that any disposition or other allocation of any assets (including any Equity Interests of such Delaware Divided LLC) in connection therewith is otherwise permitted hereunder; and
(s) the consummation of the Merger pursuant to, and in accordance with the requirements of, the Merger Agreement. Notwithstanding anything to the contrary contained in Section 6.05 above, no Disposition of assets under Section 6.05(g) or, solely with respect to Sale and Lease-Back Transactions referred to in clause (b)(y) of Section 6.03, under Section 6.05(d), shall be permitted unless (i) such Disposition is for fair market value (as determined in good faith by the BorrowerBorrower Agent), or if not for fair market value, the shortfall is permitted as an Investment under Section 6.046.04 (and reduces the applicable Investment basket on a dollar-for-dollar basis), and (ii) at least 75% of the proceeds of such Disposition (except to Loan Parties) consist of cash or Permitted Investments; provided, that the provisions of this clause (ii) shall not apply to any individual transaction or series of related transactions involving assets with a fair market value (as determined in good faith by the BorrowerBorrower Agent) of less than $12,500,000 or to other transactions involving assets with a fair market value (as determined in good faith by the BorrowerBorrower Agent) of not more than the greater of $85,000,000 107,000,000 and 0.20 times the Adjusted EBITDA calculated on a Pro Forma Basis for the then most recently ended Test Period in the aggregate for all such transactions during the term of this Agreement; provided, further, that for purposes of this clause (ii), each of the following shall be deemed to be cash: (a) the amount of any liabilities (as shown on the Borrower’s Agent’s or such Subsidiary’s most recent balance sheet or in the notes thereto or, if incurred or increased subsequent to the date of such balance sheet, such liabilities that would have been shown on the Borrower’s Agent’s or such any Subsidiary’s balance sheet or in the notes thereto if such incurrence or increase had taken place on or prior to the date of such balance sheet, as determined by the BorrowerBorrower Agent) of the Borrower Agent or any Subsidiary that are assumed by the transferee of any such assets (or a third party in connection with such transfer) or are otherwise cancelled or terminated in connection with such transaction, (b) any notes or other obligations or other securities or assets received by the Borrower Agent or such any Subsidiary from the transferee that are converted by the Borrower Agent or such any Subsidiary into cash within 180 days after receipt thereof (to the extent of the cash received), (c) any Designated Non-Cash Consideration received by the Borrower Agent or any of its Subsidiaries in such Disposition having an aggregate fair market value (as determined in good faith by the BorrowerBorrower Agent), taken together with all other Designated Non-Cash Consideration received pursuant to this clause (c) that is at that time outstanding, not to exceed the greater of $165,000,000 187,000,000 and 0.35 times the Adjusted EBITDA calculated on a Pro Forma Basis for the Test Period ended immediately prior to the receipt of such Designated Non-Cash Consideration (with the fair market value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value), (d) the amount of Indebtedness of any Subsidiary that is no longer a Subsidiary as a result of such Asset Sale, to the extent that Holdings, the Borrower Agent and each other Subsidiary are released from any guarantee of payment of such Indebtedness in connection with the Asset Sale and (e) consideration consisting of Indebtedness of the Borrower Agent or a Subsidiary (other than Indebtedness that is subordinated in right of payment to the Loan Obligations) received from persons who are not Holdings, the Borrower Agent or a Subsidiary in connection with the Asset Sale and that is cancelled or otherwise extinguished. Notwithstanding the foregoing, the Borrower Agent shall not, nor shall it permit any Subsidiary to, (x) transfer (including by way of sale, investment, exclusive license or designation of a Subsidiary as an Unrestricted Subsidiary) any Intellectual Property that is material to the business of the Borrower Agent and the Subsidiaries taken as a whole to any Unrestricted Subsidiary and (y) transfer legal or beneficial ownership of, or an exclusive license to, any Intellectual Property that is material to the business of the Borrower Agent and the Subsidiaries taken as a whole to any Unrestricted Subsidiary to Holdings or any Subsidiary that is not a Loan Party (including by way of sale or investment). For purposes of this Agreement, the fair market value of any assets acquired, leased, exchanged, Disposed of, sold, conveyed or transferred by the Borrower Agent or any Subsidiary shall be determined in good faith by the Borrower Agent and may be determined either, at the option of the BorrowerBorrower Agent, at the time of such acquisition, lease, exchange, Disposition, sale, conveyance or transfer, as applicable, or as of the date of the definitive agreement with respect to such acquisition, lease, exchange, Disposition, sale, conveyance or transfer, as applicable.
Appears in 1 contract
Samples: Credit Agreement (Dave & Buster's Entertainment, Inc.)
Mergers, Consolidations, Sales of Assets and Acquisitions. Merge into or consolidate with any other person, or permit any other person to merge into or consolidate with it, or Dispose of (in one transaction or in a series of related transactions) all or any part of its assets (whether now owned or hereafter acquired), effect any Delaware LLC Division or Dispose of any Equity Interests of any Subsidiary, or purchase, lease or otherwise acquire (in one transaction or a series of related transactions) all of the assets of any other person or division or line of business of a person, except that this Section 6.05 shall not prohibit:
(a) (i) the purchase, discount or Disposition of equipment, inventory, accounts receivable, notes receivable or other assets, in each case in the ordinary course of business or consistent with past practice or industry norm by the Borrower Agent or any Subsidiary or the conversion of accounts receivable to notes receivable, (ii) the acquisition or lease (pursuant to an operating lease) of any other asset in the ordinary course of business or consistent with past practice or industry norm by the Borrower Agent or any Subsidiary or, with respect to operating leases, otherwise for fair market value on market terms (as determined in good faith by the BorrowerBorrower Agent), (iii) the Disposition of surplus, obsolete, damaged or worn out equipment or other property by the Borrower Agent or any Subsidiary in the ordinary course of business or consistent with past practice or industry norm or determined in good faith by the Borrower Agent to be no longer used or useful or necessary in the operation of the business of the Borrower Agent or any Subsidiary, (iv) [reserved], (v) the Disposition of Permitted Investments in the ordinary course of business or (vi) the Disposition of property or equipment or the abandonment of Intellectual Property rights that is otherwise economically impracticable to maintain;
(b) if at the time thereof and immediately after giving effect thereto no Event of Default shall have occurred and be continuing or would result therefrom, (i) the liquidation, dissolution, merger or consolidation of any Subsidiary (other than the Borrower Agent) with or into the any Borrower in a transaction in which the a Borrower is the survivor or the requirements of Section 6.05(o) are otherwise complied with, (ii) the merger or consolidation of any Subsidiary (other than the BorrowerBorrower Agent) with or into the any Borrower or any other Subsidiary in a transaction in which the surviving or resulting entity is or becomes a Borrower, a Subsidiary or, in the case of any merger or consolidation with or into the Borrower or a Subsidiary Agent, the Borrower Agent and, in the case of each of clauses (i) and (ii), no person other than the Borrower, the a Borrower or a Subsidiary receives any consideration (unless otherwise permitted by Section 6.04), (iii) the liquidation, dissolution or merger or consolidation of any Subsidiary (other than the BorrowerBorrower Agent) with or into the any Borrower or any other Subsidiary, (iv) the change in form of entity of the any Borrower or any Subsidiary if the Borrower Agent determines in good faith that such change in form is advisable or in the best interests of the Borrower Borrowers and is not materially disadvantageous to the Lenders, (v) any Subsidiary (other than the BorrowerBorrower Agent) may merge or consolidate with any other person in order to effect an Investment permitted pursuant to Section 6.04 so long as the continuing or surviving person shall be a Borrower, a Subsidiary or, in the case of any merger or consolidation with or into the Borrower or a Subsidiary Agent, the Borrower Agent (unless otherwise permitted by Section 6.04), and which together with each of its Subsidiaries shall have complied with any applicable requirements of Section 5.10 or (vi) any Subsidiary (other than the BorrowerBorrower Agent) may merge or consolidate with any other person in order to effect an Asset Sale otherwise permitted pursuant to this Section 6.05;
(c) Dispositions to the Borrower Agent or a Subsidiary (upon voluntary liquidation or otherwise); provided, that following any such Disposition of all or substantially all of the assets of the BorrowerBorrower Agent, the Borrower Agent is the surviving entity or the requirements of Section 6.05(o) are otherwise complied with;
(d) Sale and Lease-Back Transactions permitted by Section 6.03;
(e) (i) Investments permitted by Section 6.04, Permitted Liens permitted by Section 6.02 and Restricted Payments permitted by Section 6.06 and (ii) any Disposition made in connection with the Transactions6.06;
(f) Dispositions of defaulted receivables in the ordinary course of business and not as part of an accounts receivables financing transaction;
(g) other Dispositions of assets; provided, that the Net Proceeds thereof, if any, are applied in accordance with Section 2.11(b) to the extent required thereby;
(h) Permitted Business Acquisitions (including any merger, consolidation or amalgamation in order to effect a Permitted Business Acquisition); provided, that following any such merger, consolidation or amalgamation involving the BorrowerBorrower Agent, the Borrower Agent is the surviving entity or the requirements of Section 6.05(o) are otherwise complied with;
(i) leases, assignments, licenses or subleases or sublicenses of any real or personal property in the ordinary course of business or consistent with past practice or industry norm;
(j) Dispositions of inventory or equipment or Dispositions or abandonment of Intellectual Property of the Borrower Agent and its Subsidiaries determined in good faith by the management of the Borrower Agent to be no longer useful or necessary in the operation of the business of, or material to the conduct of the business of, the Borrower Agent or any of the Subsidiaries;
(k) acquisitions and purchases made with the proceeds of any Asset Sale pursuant to the first proviso of clause (a) of the definition of “Net Proceeds”;[reserved]
(l) the purchase and Disposition (including by capital contribution) of (i) Securitization Assets including pursuant to Permitted Securitization Financings, (ii) any other Securitization Assets subject to Liens securing Permitted Securitization Financing and (iii) receivables Receivables Assets in connection with a receivables factoring or financing;
(m) to the extent constituting a Disposition, any termination, settlement, extinguishment or unwinding of obligations in respect of any Hedging Agreement;
(n) any exchange of assets for services and/or other assets used or useful in a Similar Business of comparable or greater value; provided, that (i) to the extent the consideration received consists of assets, at least 90% of the consideration received by the transferor consists of assets that will be used in a business or business activity permitted hereunder, (ii) in the event of a swap with a fair market value (as determined in good faith by the BorrowerBorrower Agent) in excess of $10,000,000, the Administrative Agent shall have received a certificate from a Responsible Officer of the Borrower Agent with respect to such fair market value and (iii) in the event of a swap with a fair market value (as determined in good faith by the BorrowerBorrower Agent) in excess of $15,000,000, such exchange shall have been approved by at least a majority of the Board of Directors of Holdings or the BorrowerBorrower Agent;
(o) if at the time thereof and immediately after giving effect thereto no Event of Default shall have occurred and be continuing or would result therefrom, the Borrower, any Subsidiary or any other person may be liquidated, dissolved, merged, amalgamated or consolidated with or into the BorrowerBorrower Agent; provided that (A) the Borrower Agent shall be the surviving entity or (B) if the surviving entity is not the Borrower Agent (such other person, the “Successor Borrower”), (1) the Successor Borrower shall be an entity organized or existing under the laws of the United States, any state thereof or the District of Columbia, (2) the Successor Borrower shall expressly assume all the obligations of the Borrower Agent under this Agreement and the other Loan Documents pursuant to a supplement hereto or thereto in form reasonably satisfactory to the Administrative Agent, (3) each Guarantor, unless it is the other party to such merger or consolidation, shall have by a counterpart to this Agreement, as applicable, confirmed that its guarantee thereunder shall apply to any Successor Borrower’s obligations under this Agreement, (4) each Subsidiary Guarantor, unless it is the other party to such merger or consolidation, shall have by a supplement to any applicable Collateral Document affirmed that its obligations thereunder shall apply to its guarantee as reaffirmed pursuant to clause (3), (5) each mortgagor of a Mortgaged Property), unless it is the other party to such merger or consolidation, shall have affirmed that its obligations under the applicable Mortgage shall apply to its guarantee as reaffirmed pursuant to clause (3) [reserved] and (6) the Successor Borrower shall have delivered to the Administrative Agent (x) an officer’s certificate stating that such merger or consolidation does not violate this Agreement or any other Loan Document and (y) if requested by the Administrative Agent, an opinion of counsel to the effect that such liquidation, dissolution, merger, amalgamation or consolidation does not violate this Agreement or any other Loan Document and covering such other matters as are contemplated by the Collateral and Guarantee Requirement to be covered in opinions of counsel (it being understood that if the foregoing are satisfied, the Successor Borrower will Borxxxxx xxll succeed to, and be substituted for, the Borrower Agent under this Agreement);
(p) Dispositions in connection with the exercise of any subscriptions, options, warrants, puts, calls or other rights or commitments pursuant to agreements set forth on Schedule 3.08(b);
(q) Dispositions of property or assets (i) acquired after the Closing Date which property or assets are not used or useful to the core or principal business of the Borrower Agent and the Subsidiaries in the good faith determination of the Borrower Agent or (ii) that are made in connection with the approval of any applicable antitrust authority or as otherwise necessary or advisable in the good faith determination of the Borrower Agent to consummate any Permitted Business Acquisition, New Project, Investment or other transaction; and;
(r) any Disposition to effect the formation of any Subsidiary that is a Delaware Divided LLC and would otherwise not be prohibited hereunder; provided that any disposition or other allocation of any assets (including any Equity Interests of such Delaware Divided LLC) in connection therewith is otherwise permitted hereunder; and
(s) the consummation of the Merger pursuant to, and in accordance with the requirements of, the Merger Agreement. Notwithstanding anything to the contrary contained in Section 6.05 above, no Disposition of assets under Section 6.05(g) or, solely with respect to Sale and Lease-Back Transactions referred to in clause (b)(y) of Section 6.03, under Section 6.05(d), shall be permitted unless (i) such Disposition is for fair market value (as determined in good faith by the BorrowerBorrower Agent), or if not for fair market value, the shortfall is permitted as an Investment under Section 6.046.04 (and reduces the applicable Investment basket on a dollar-for-dollar basis), and (ii) at least 75% of the proceeds of such Disposition (except to Loan Parties) consist of cash or Permitted Investments; provided, that the provisions of this clause (ii) shall not apply to any individual transaction or series of related transactions involving assets with a fair market value (as determined in good faith by the BorrowerBorrower Agent) of less than $12,500,000 or to other transactions involving assets with a fair market value (as determined in good faith by the BorrowerBorrower Agent) of not more than the greater of $85,000,000 107,000,000 and 0.20 times the Adjusted EBITDA calculated on a Pro Forma Basis for the then most recently ended Test Period in the aggregate for all such transactions during the term of this Agreement; provided, further, that for purposes of this clause (ii), each of the following shall be deemed to be cash: (a) the amount of any liabilities (as shown on the BorrowerBorrower Agent’s or such Subsidiary’s most recent balance sheet or in the notes thereto or, if incurred or increased subsequent to the date of such balance sheet, such liabilities that would have been shown on the BorrowerBorrower Agent’s or such any Subsidiary’s balance sheet or in the notes thereto if such incurrence or increase had taken place on or prior to the date of such balance sheet, as determined by the BorrowerBorrower Agent) of the Borrower Agent or any Subsidiary that are assumed by the transferee of any such assets (or a third party in connection with such transfer) or are otherwise cancelled or terminated in connection with such transaction, (b) any notes or other obligations or other securities or assets received by the Borrower Agent or such any Subsidiary from the transferee that are converted by the Borrower Agent or such any Subsidiary into cash within 180 days after receipt thereof (to the extent of the cash received), (c) any Designated Non-Cash Consideration received by the Borrower Agent or any of its Subsidiaries in such Disposition having an aggregate fair market value (as determined in good faith by the BorrowerBorrower Agent), taken together with all other Designated Non-Cash Consideration received pursuant to this clause (c) that is at that time outstanding, not to exceed the greater of $165,000,000 187,000,000 and 0.35 times the Adjusted EBITDA calculated on a Pro Forma Basis for the Test Period ended immediately prior to the receipt of such Designated Non-Cash Consideration (with the fair market value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value), (d) the amount of Indebtedness of any Subsidiary that is no longer a Subsidiary as a result of such Asset Sale, to the extent that Holdings, the Borrower Agent and each other Subsidiary are released from any guarantee of payment of such Indebtedness in connection with the Asset Sale and (e) consideration consisting of Indebtedness of the Borrower Agent or a Subsidiary (other than Indebtedness that is subordinated in right of payment to the Loan Obligations) received from persons who are not Holdings, the Borrower Agent or a Subsidiary in connection with the Asset Sale and that is cancelled or otherwise extinguished. Notwithstanding the foregoing, the Borrower Agent shall not, nor shall it permit any Subsidiary to, (x) transfer (including by way of sale, investment, exclusive license or designation of a Subsidiary as an Unrestricted Subsidiary) any Intellectual Property that is material to the business of the Borrower Agent and the Subsidiaries taken as a whole to any Unrestricted Subsidiary and (y) transfer legal or beneficial ownership of, or an exclusive license to, any Intellectual Property that is material to the business of the Borrower Agent and the Subsidiaries taken as a whole to any Unrestricted Subsidiary to Holdings or any Subsidiary that is not a Loan Party (including by way of sale or investment). For purposes of this Agreement, the fair market value of any assets acquired, leased, exchanged, Disposed of, sold, conveyed or transferred by the Borrower Agent or any Subsidiary shall be determined in good faith by the Borrower Agent and may be determined either, at the option of the BorrowerBorrower Agent, at the time of such acquisition, lease, exchange, Disposition, sale, conveyance or transfer, as applicable, or as of the date of the definitive agreement with respect to such acquisition, lease, exchange, Disposition, sale, conveyance or transfer, as applicable.
Appears in 1 contract
Samples: Credit Agreement (Dave & Buster's Entertainment, Inc.)
Mergers, Consolidations, Sales of Assets and Acquisitions. Merge into into, amalgamate with or consolidate with any other person, or permit any other person to merge into into, amalgamate with or consolidate with it, or Dispose of (in one transaction or in a series of related transactions) all or any part of its assets (whether now owned or hereafter acquired), effect any Delaware LLC Division or Dispose of any Equity Interests of any Subsidiary, or purchase, lease or otherwise acquire (in one transaction or a series of related transactions) all or substantially all of the assets of any other person or division or line of business of a personperson (including, in each case, pursuant to a Division), except that this Section 6.05 shall not prohibit:
(a) (i) the purchasepurchase and Disposition by Parent or any Subsidiary of inventory, discount or Disposition of products, equipment, inventory, services or accounts receivable, notes receivable or other assets, in each case in the ordinary course of business or consistent with past practice or industry norm by the Borrower or any Subsidiary or the conversion of accounts receivable to notes receivable, practice,
(ii) the disposition of a business not comprising the disposition of an entire line of business,
(iii) the acquisition or lease (pursuant to an operating lease) of any other asset in the ordinary course of business or consistent with past practice or industry norm by the Borrower Parent or any Subsidiary or, with respect to operating leases, otherwise for fair market value Fair Market Value on market terms (as determined in good faith by the Borrower), ,
(iiiiv) the Disposition by Parent or any Subsidiary of surplus, obsolete, damaged or worn out equipment or other property by the Borrower or any Subsidiary in the ordinary course of business or consistent with past practice or industry norm or determined in good faith by the Borrower to be no longer used or useful or necessary in the operation of the business of the Borrower or any Subsidiary, (iv) [reserved], practice,
(v) the Disposition of Permitted Investments in the ordinary course of business or business, or
(vi) sales of non-core personal property acquired in connection with an acquisition permitted hereunder and sales of real property acquired in an acquisition permitted hereunder, which, within ninety (90) days of the Disposition date of property the acquisition, are designated in writing to the Administrative Agent as being held for sale and not for the continued operation of Parent or equipment any of its Subsidiaries or the abandonment any of Intellectual Property rights that is otherwise economically impracticable to maintaintheir respective businesses;
(b) if at the time thereof and immediately after giving effect thereto no Event of Default shall have occurred and be continuing or would result therefrom, ,
(i) the liquidationmerger, dissolution, merger amalgamation or consolidation of any Subsidiary with or into Parent or the Borrower in a transaction in which Parent or the Borrower is the survivor or the requirements of Section 6.05(o) are otherwise complied with, survivor,
(ii) the merger merger, amalgamation or consolidation of any Subsidiary (other than the Borrower) with or into the Borrower or any other Subsidiary Guarantor in a transaction in which the surviving or resulting entity is or becomes the Borrower or a Subsidiary Guarantor, and, in the case of each of clauses (i) and (ii)) above, no person other than the Borrower, the Borrower or a Subsidiary Guarantor receives any consideration (unless otherwise permitted by Section 6.04), ,
(iii) the liquidationmerger, amalgamation or consolidation of any Subsidiary that is not a Guarantor with or into any other Subsidiary that is not a Guarantor,
(iv) the liquidation or dissolution or merger or consolidation change in form of entity of any Subsidiary (other than the Borrower) with or into if (x) the Borrower or any other Subsidiary, (iv) the change in form of entity of the Borrower or any Subsidiary if the Borrower Parent determines in good faith that such liquidation, dissolution or change in form is advisable or in the best interests of the Borrower Parent and its Subsidiaries and is not materially disadvantageous to the Lenders, Lenders and (y) the same meets the requirements contained in the proviso to Section 5.01(a),
(v) the merger, amalgamation or consolidation of any Subsidiary (other than the Borrower) may merge or consolidate with any other person in order to effect an Investment permitted pursuant to Section 6.04 so long as the continuing or surviving person shall be the Borrower or a Subsidiary (unless otherwise permitted by Section 6.046.04 (other than Section 6.04(m)(ii))), which shall be a Loan Party if the merging, amalgamating or consolidating Subsidiary was a Loan Party and which together with each of its Subsidiaries shall have complied with any applicable requirements of Section 5.10 5.10, or (vi) any Subsidiary (other than the Borrower) may merge merge, amalgamate or consolidate with any other person in order to effect an Asset Sale otherwise permitted pursuant to this Section 6.05;
(c) Dispositions to Parent, the Borrower or a Subsidiary (upon voluntary liquidation or otherwise)Subsidiary; provided, that following any such Disposition of all or substantially all of the assets of Dispositions by a Loan Party to a Subsidiary that is not a Loan Party in reliance on this clause (c) shall be for Fair Market Value (as determined in good faith by the Borrower, the Borrower is the surviving entity ) or the requirements of made in compliance with Section 6.05(o) are otherwise complied with6.04;
(d) Sale and Lease-Back Transactions permitted licenses, sublicenses, or covenants not to sue by Section 6.03Parent or any Subsidiary of or under Intellectual Property or software or other technology;
(e) (i) Investments permitted by Section 6.046.04 (other than Section 6.04(m)(ii)), Permitted Liens Liens, and Restricted Payments permitted by Section 6.06 and (ii) any Disposition made in connection with the Transactions6.06;
(f) Dispositions of defaulted receivables the discount, forgiveness or sale, in each case without recourse and in the ordinary course of business business, of past due receivables arising in the ordinary course of business, but only in connection with the compromise or collection thereof consistent with customary industry practice (and not as part of an accounts receivables any bulk sale or financing transactionof receivables);
(g) other Dispositions of assetsassets (including in connection with sale leaseback transactions); provided, that (i) the Net Proceeds thereof, if any, are applied in accordance with Section 2.11(b) to the extent required therebythereby and (ii) any such Dispositions shall comply with the final sentence of this Section 6.05;
(h) Permitted Business Acquisitions (including any merger, consolidation or amalgamation in order to effect a Permitted Business Acquisition); provided, that following any such merger, consolidation or amalgamation involving the Borrower, the Borrower is the surviving entity or the requirements of Section 6.05(o6.05(n) are otherwise complied with;
(i) leases, assignments, licenses or subleases or sublicenses of any real or personal property in the ordinary course of business or consistent with past practice or industry normbusiness;
(j) Dispositions of inventory or equipment or Dispositions or abandonment of Intellectual Property of the Borrower Parent and its Subsidiaries determined in good faith by the management of the Borrower to be no longer economically practicable or commercially reasonable to maintain or useful or necessary in the operation of the business of, or material to the conduct of the business of, the Borrower Parent or any of the Subsidiaries;
(k) acquisitions and purchases made with the proceeds of any Asset Sale Dispositions pursuant to the first proviso any individual transaction or series of clause (a) related transactions involving assets with a Fair Market Value of the definition of “Net Proceeds”less than $25,000,000;
(l) the purchase and Disposition (including by capital contribution) of (i) Securitization Assets and Permitted Receivables Facility Assets, or participations therein, including pursuant to Permitted Qualified Securitization Financings, (ii) any other Securitization Assets subject to Liens securing Permitted Securitization Financing and (iii) receivables in connection with a receivables financingTransactions or Qualified Receivables Facilities;
(m) to the extent constituting a Disposition, any termination, settlement, extinguishment or unwinding of obligations in respect of any Hedging Agreement;
(n) any exchange or swap of assets (other than cash and Permitted Investments) for services and/or other assets used or useful in a Similar Business (other than cash and Permitted Investments) of comparable or greater value; provided, that (i) value or usefulness to the extent business of Parent and the consideration received consists of assetsSubsidiaries as a whole, at least 90% of the consideration received by the transferor consists of assets that will be used in a business or business activity permitted hereunder, (ii) in the event of a swap with a fair market value (as determined in good faith by the Borrower) in excess management of $10,000,000, the Administrative Agent shall have received a certificate from a Responsible Officer of the Borrower with respect to such fair market value and (iii) in the event of a swap with a fair market value (as determined in good faith by the Borrower) in excess of $15,000,000, such exchange shall have been approved by at least a majority of the Board of Directors of Holdings or the Borrower;
(on) if at the time thereof and immediately after giving effect thereto no Event of Default shall have occurred and be continuing or would result therefrom, the Borrower, any Subsidiary or any other person may be liquidated, dissolved, merged, amalgamated or consolidated with or into the Borrower; , provided that (A) the Borrower shall be the surviving entity or (B) if the surviving entity is not the Borrower (such other person, the “Successor Borrower”), (1) the Successor Borrower shall be an entity organized or existing under the laws of the United States, any state thereof or the District of Columbia, (2) the Successor Borrower shall expressly assume all the obligations of the Borrower under this Agreement and the other Loan Documents pursuant to a supplement hereto or thereto and, in the case of any Security Document, by executing and/or delivering any additional required documents, in each case in a form reasonably satisfactory to the Administrative Agent, (3) each Guarantor, unless it is the other party to such merger merger, amalgamation or consolidation, shall have by a counterpart supplement to this the Guarantee Agreement, as applicable, confirmed that its guarantee thereunder shall apply to any Successor Borrower’s obligations under this Agreement, (4) each Subsidiary Guarantor, unless it is the other party to such merger merger, amalgamation or consolidation, shall have by a supplement to any applicable Collateral Security Document affirmed that its obligations thereunder shall apply to its guarantee as reaffirmed pursuant to clause (3), (5) each mortgagor of a Mortgaged Property[reserved], unless it is the other party to such merger or consolidation, shall have affirmed that its obligations under the applicable Mortgage shall apply to its guarantee as reaffirmed pursuant to clause (3) and (6) the Successor Borrower shall have delivered to the Administrative Agent (x) an officer’s a certificate of a Responsible Officer stating that such merger merger, amalgamation or consolidation does not violate this Agreement or any other Loan Document and (y) if requested by the Administrative Agent, an opinion of counsel to the effect that such liquidation, dissolution, merger, amalgamation or consolidation does not violate this Agreement or any other Loan Document and covering such other matters as are contemplated by the Collateral and Guarantee Requirement to be covered in opinions of counsel and (7) to the extent requested by the Administrative Agent or a Lender (as requested through the Administrative Agent), the Administrative Agent and any such Lender shall have received at least three (3) Business Days prior to the consummation of such merger, amalgamation or consolidation all documentation and other information required with respect to the Successor Borrower by regulatory authorities under applicable “know your customer” and anti-money laundering rules and regulations, including, without limitation, the USA PATRIOT Act and the Beneficial Ownership Regulation (it being understood that if the foregoing are satisfied, the Successor Borrower will succeed to, and be substituted for, the Borrower under this Agreement);
(o) any conversion of a Loan Party from a corporation to a limited liability company, or from a limited liability company to a corporation, or other change in corporate formation;
(p) Dispositions in connection with the exercise any surrender, termination or waiver of contract rights or settlement, release, waiver of, recovery on or surrender of contract, tort or other claims of any subscriptions, options, warrants, puts, calls or other rights or commitments pursuant to agreements set forth on Schedule 3.08(b)kind;
(q) Dispositions any solvent liquidation or dissolution of property a Subsidiary of Parent, provided that such Subsidiary’s direct parent is also either Parent or assets (i) acquired after a Subsidiary and immediately becomes the Closing Date which property or assets are not used or useful to the core or principal business owner of the Borrower and the Subsidiaries in the good faith determination of the Borrower or (ii) that are made in connection with the approval of any applicable antitrust authority or as otherwise necessary or advisable in the good faith determination of the Borrower to consummate any Permitted Business Acquisition, New Project, Investment or other transaction; andsuch Subsidiary’s assets;
(r) any Disposition financing transaction with respect to effect property built, acquired, replaced, repaired or improved (including any reconstruction, refurbishment, renovation and/or development of real property) by Parent or any of its Subsidiaries after the formation Closing Date, including, sale leaseback transactions and Securitization Transactions permitted by this Agreement;
(s) any issuance, sale, pledge or other disposition of Equity Interests in, or Indebtedness or other securities of, an Unrestricted Subsidiary;
(t) the sale, transfer, termination or other disposition in connection with Hedging Agreements incurred in compliance with this Agreement or the partial or total unwinding of obligations in respect of any Cash Management Agreements or Hedging Agreements in compliance with this Agreement;
(u) sales of assets received by Parent or any Subsidiary that is upon the foreclosure on a Delaware Divided LLC Lien;
(v) dispositions arising from foreclosures, condemnations, eminent domain, seizure, nationalization or any similar action with respect to assets, and would otherwise not be prohibited hereunderdispositions of property subject to casualty events (including, without limitation, resulting from any involuntary loss or damage to or destruction of any property or assets of Parent or any Subsidiary);
(w) the termination of leases and subleases in the ordinary course of business;
(x) to the extent allowable under Section 1031 of the Code, any exchange of like property (excluding any boot thereon) for use in a Permitted Business;
(y) dispositions of assets or Investments (including Equity Interests) in connection with the establishment or operation of joint ventures to the extent required by, or made pursuant to (including customary buy/sell arrangements or rights of first refusal between the joint venture parties set forth in) joint venture arrangements and similar binding arrangements;
(z) any exchange of assets for other assets used in the business of Parent or any Subsidiary (including a combination of such assets and a de minimis amount of cash or Permitted Investments) of comparable or greater market value than the assets exchanged, as determined in good faith by Parent, which exchange occurs within 90 days of the transfer of such assets;
(aa) any sale leaseback transaction of any property acquired or built after the Closing Date; provided that such sale is for at least Fair Market Value;
(bb) the surrender or waiver of obligations of trade creditors or customers or other contract rights that were incurred in the ordinary course of business of Parent or any of Subsidiary, including pursuant to any plan of reorganization or similar arrangement upon the bankruptcy or insolvency of any trade creditor or customer or compromise, settlement, release or surrender of a contract, tort or other litigation claim, arbitration or other disputes;
(cc) dispositions of property to the extent that (i) such property is exchanged for credit against the purchase price of similar replacement property that is purchased within 90 days of such disposition or (ii) the proceeds of such disposition are applied within 90 days of such disposition to the purchase price of such replacement property (which replacement property is purchased within 90 days of such disposition);
(dd) sales of property in connection with factoring agreements or arrangements in the ordinary course of business, including to: (i) Citibank, N.A. under that certain Supplier Agreement, dated as of October 1, 2017, by and among the Borrower and Citibank, N.A. (as amended, restated, amended and restated, supplemented, and/or otherwise modified from time to time); and (ii) Taulia Inc. under the Taulia Business Exchange Hosted Service Terms and Conditions by and between Spirit AeroSystems (Europe) Limited and Taulia Inc. (as amended, restated, amended and restated, supplemented, and/or otherwise modified in writing from time to time);
(ee) sales, transfers and/or other allocation dispositions of property by one or more Loan Parties in connection with the incurrence of any assets Qualifying IRB Financing or other Permitted Incentive Program; and
(including any Equity Interests of such Delaware Divided LLCff) in connection therewith is otherwise permitted hereundersales, transfers or other dispositions to customers pursuant to customer contracts. Notwithstanding anything to the contrary contained in Section 6.05 above, no Disposition of assets under Section 6.05(g) or, solely with respect to Sale and Lease-Back Transactions referred to shall in clause (b)(y) of Section 6.03, under Section 6.05(d), shall each case be permitted unless (i) such Disposition is for fair market value (as determined in good faith by the Borrower), or if not for fair market value, the shortfall is permitted as an Investment under Section 6.04Fair Market Value, and (ii) at least 75% of the proceeds of such Disposition (except to Loan Parties) consist of cash or Permitted Investments; provided, that the provisions of this clause (ii) shall not apply to any individual transaction or series of related transactions involving assets with a fair market value (as determined in good faith by the Borrower) of less than $12,500,000 or to other transactions involving assets with a fair market value (as determined in good faith by the Borrower) of not more than the greater of $85,000,000 and 0.20 times the Adjusted EBITDA calculated on a Pro Forma Basis for the then most recently ended Test Period in the aggregate for all such transactions during the term of this Agreement; provided, further, that for purposes of this clause (ii), each of the following shall be deemed to be cash: (a) the amount of any liabilities (as shown on the BorrowerParent’s or such Subsidiary’s most recent balance sheet or in the notes thereto or, if incurred or increased subsequent to the date of such balance sheet, such liabilities that would have been shown on the Borrower’s or such Subsidiary’s balance sheet or in the notes thereto if such incurrence or increase had taken place on or prior to the date of such balance sheet, as determined by the Borrowerthereto) of the Borrower or any Subsidiary that are assumed by the transferee of any such assets (or a third party in connection with such transfer) or are otherwise cancelled or terminated in connection with such transaction, (b) any notes or other obligations or other securities or assets received by the Borrower Parent or such Subsidiary from the transferee that are converted by the Borrower Parent or such Subsidiary into cash or Permitted Investments within 180 days after receipt thereof (to the extent of the cash or Permitted Investments received), ) and (c) any Designated Non-Cash Consideration received by the Borrower Parent or any of its Subsidiaries in such Disposition or any series of related Dispositions, having an aggregate fair market value (as determined in good faith by the Borrower), taken together with all other Designated Non-Cash Consideration received pursuant to this clause (c) that is at that time outstanding, Fair Market Value not to exceed exceed, in the aggregate, the greater of $165,000,000 215,000,000 and 0.35 times the Adjusted EBITDA calculated on a Pro Forma Basis for the Test Period ended immediately prior to the receipt 3.0% of such Designated Non-Cash Consideration Consolidated Total Assets when received (with the fair market value Fair Market Value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value), (d) the amount of Indebtedness of any Subsidiary that is no longer a Subsidiary as a result of such Asset Sale, to the extent that Holdings, the Borrower and each other Subsidiary are released from any guarantee of payment of such Indebtedness in connection with the Asset Sale and (e) consideration consisting of Indebtedness of the Borrower or a Subsidiary (other than Indebtedness that is subordinated in right of payment to the Loan Obligations) received from persons who are not Holdings, the Borrower or a Subsidiary in connection with the Asset Sale and that is cancelled or otherwise extinguished. For purposes of this Agreement, the fair market value of any assets acquired, leased, exchanged, Disposed of, sold, conveyed or transferred by the Borrower or any Subsidiary shall be determined in good faith by the Borrower and may be determined either, at the option of the Borrower, at the time of such acquisition, lease, exchange, Disposition, sale, conveyance or transfer, as applicable, or as of the date of the definitive agreement with respect to such acquisition, lease, exchange, Disposition, sale, conveyance or transfer, as applicable.
Appears in 1 contract
Samples: Term Loan Credit Agreement (Spirit AeroSystems Holdings, Inc.)
