Common use of Restrictions on Subsidiary Distributions Clause in Contracts

Restrictions on Subsidiary Distributions. Except as provided herein, no Loan Party shall, nor shall it permit any of its Subsidiaries to, create or otherwise cause or suffer to exist or become effective any consensual encumbrance or restriction of any kind on the ability of any Subsidiary of Borrower to (a) pay dividends or make any other distributions on any of such Subsidiary’s Capital Stock owned by Borrower or any other Subsidiary of Borrower, (b) repay or prepay any Indebtedness owed by such Subsidiary to Borrower or any other Subsidiary of Borrower, (c) make loans or advances to Borrower or any other Subsidiary of Borrower, or (d) transfer any of its property or assets to Borrower or any other Subsidiary of Borrower other than restrictions (i) in agreements evidencing Permitted Purchase Money Indebtedness that impose restrictions on the property so acquired, (ii) by reason of customary provisions restricting assignments, subletting, or other transfers contained in leases, licenses, joint venture agreements, and similar agreements entered into in the ordinary course of business, (iii) that are or were created by virtue of any transfer of, agreement to transfer, or option or right with respect to any property, assets, or Capital Stock not otherwise prohibited under this Agreement, and (iv) that are imposed by law. No Loan Party shall, nor shall it permit its Subsidiaries to, enter into any Contractual Obligations which would prohibit a Subsidiary of Parent from being a Loan Party.

Restrictions on Subsidiary Distributions. Except as provided herein, no Loan Party shall, nor shall it permit any of its the Company’s Subsidiaries to, create or otherwise cause or suffer to exist or become effective any consensual encumbrance or restriction of any kind on the ability of any Subsidiary of Borrower Company to (a) pay dividends or make any other distributions on any of such Subsidiary’s Capital Stock owned by Borrower Company or any other Subsidiary of BorrowerCompany, (b) repay or prepay any Indebtedness owed by such Subsidiary to Borrower Company or any other Subsidiary of BorrowerCompany, (c) make loans or advances to Borrower Company or any other Subsidiary of BorrowerCompany, or (d) transfer any of its property or assets to Borrower Company or any other Subsidiary of Borrower Company, in each case, other than restrictions (i) in agreements evidencing purchase money Indebtedness permitted by clause (h) of the definition of Permitted Purchase Money Indebtedness that impose restrictions on the property so acquired, (ii) by reason of customary provisions restricting assignments, sublettingchange of control, subletting or other transfers contained in leases, licenses, joint venture agreementsagreements and other agreements (including, and similar agreements without limitation, Permitted Product Agreements, but solely to the extent that such customary provisions are not broader than the scope of the RPI Agreement, Royalty Monetization Transactions or Permitted Product Agreements expressly permitted under this Agreement) entered into in the ordinary course of business, and (iii) that are or were created by virtue of any transfer of, agreement to transfer, transfer or option or right with respect to any property, assets, assets or Capital Stock not otherwise prohibited under this Agreement, and (iv) that are imposed by law. No Loan Party shall, nor shall it permit its Subsidiaries to, enter into any Contractual Obligations which would prohibit a Subsidiary of Parent the Company from being a Loan PartyParty (other than Excluded Subsidiaries).

Restrictions on Subsidiary Distributions. Except as provided herein, no Loan Party shall, nor shall it permit any of its the Company’s Subsidiaries to, create or otherwise cause or suffer to exist or become effective any consensual encumbrance or restriction of any kind on the ability of any Subsidiary of Borrower Company to (a) pay dividends or make any other distributions on any of such Subsidiary’s Capital Stock owned by Borrower Company or any other Subsidiary of BorrowerCompany, (b) repay or prepay any Indebtedness owed by such Subsidiary to Borrower Company or any other Subsidiary of BorrowerCompany, (c) make loans or advances to Borrower Company or any other Subsidiary of BorrowerCompany, or (d) transfer any of its property or assets to Borrower Company or any other Subsidiary of Borrower Company, in each case, other than restrictions (i) in agreements evidencing purchase money Indebtedness permitted by clause (h) of the definition of Permitted Purchase Money Indebtedness that impose restrictions on the property so acquired, (ii) by reason of customary provisions restricting assignments, sublettingchange of control, subletting or other transfers contained in leases, licenses, joint venture agreementsagreements and other agreements (including, and similar agreements without limitation, Permitted Product Agreements, but solely to the extent that such customary provisions are not broader than the scope of the RPI Agreement, Royalty Monetization Transactions or Permitted Product Agreements expressly permitted under this Agreement) entered into in the ordinary course of business, and (iii) that are or were created by virtue of any transfer of, agreement to transfer, transfer or option or right with respect to any property, assets, assets or Capital Stock not otherwise prohibited under this Agreement, and (iv) that are imposed by law. No Loan Party shall, nor shall it permit its Subsidiaries to, enter into any Contractual Obligations which would prohibit a Subsidiary of Parent the Company from being a Loan Party.Party (other than Excluded Subsidiaries). - 96 - US-DOCS\116826573.25

Restrictions on Subsidiary Distributions. Except as provided hereinpursuant to any Credit Document, no Loan Credit Party shall, nor shall it permit any of its Subsidiaries to, create or otherwise cause or suffer to exist or become effective any consensual encumbrance or restriction of any kind on the ability of any Subsidiary of Borrower Company to (a) pay dividends or make any other distributions on any of such Subsidiary’s Capital Stock owned by Borrower Company or any other Subsidiary of BorrowerCompany, (b) repay or prepay any Indebtedness owed by such Subsidiary to Borrower Company or any other Subsidiary of BorrowerCompany, (c) make loans or advances to Borrower Company or any other Subsidiary of BorrowerCompany, or (d) transfer any of its property or assets to Borrower Company or any other Subsidiary of Borrower Company, in each case, other than restrictions (i) in agreements evidencing Permitted Purchase Money Indebtedness permitted by Section 6.1(b), (d), (h) and (k) (with respect to Indebtedness of Foreign Subsidiaries) that impose restrictions solely on the property so acquired, (ii) by reason of customary provisions restricting assignments, subletting, subletting or other transfers contained in leases, licenses, joint venture agreements, Joint Venture agreements and similar agreements entered into in the ordinary course of business, (iii) in the Infineum Agreement, (iv) in any of the Senior Subordinated Notes Documents, the Holdings Notes Indenture or any documents or agreements executed in connection with the Holdings Notes Indenture, (v) that are or were created by virtue of any transfer of, agreement to transfer, transfer or option or right with respect to any property, assets, assets or Capital Stock not otherwise prohibited under this Agreement, and (ivvi) Liens permitted to be incurred hereunder that are imposed by law. No Loan Party shall, nor shall it permit its Subsidiaries to, enter into any Contractual Obligations which would prohibit a Subsidiary limit the right to dispose of Parent from being a Loan Partythe assets subject to such Liens.

Restrictions on Subsidiary Distributions. Except as provided herein, no Loan Party shall, nor shall it permit any of its Subsidiaries to, create or otherwise cause or suffer to exist or become effective any consensual encumbrance or restriction of any kind on the ability of any Subsidiary of Borrower Company to (a) pay dividends or make any other distributions on any of such Subsidiary’s Capital Stock owned by Borrower Company or any other Subsidiary of BorrowerCompany, (b) repay or prepay any Indebtedness owed by such Subsidiary to Borrower Company or any other Subsidiary of BorrowerCompany, (c) make loans or advances to Borrower Company or any other Subsidiary of BorrowerCompany, or (d) transfer any of its property or assets to Borrower Company or any other Subsidiary of Borrower Company other than restrictions (i) in agreements evidencing (x) purchase money Indebtedness permitted by clause (h) of the definition of Permitted Purchase Money Indebtedness and (y) Indebtedness in respect of floorplan financings permitted by clause (i) of the definition of Permitted Indebtedness, in each case, that impose restrictions on the property so acquired, (ii) by reason of customary provisions restricting assignments, subletting, subletting or other transfers contained in leases, licenses, joint venture agreements, agreements and similar agreements entered into in the ordinary course of business, (iii) that are or were created by virtue of any transfer of, agreement to transfer, transfer or option or right with respect to any property, assets, assets or Capital Stock not otherwise prohibited under this Agreement, and (iv) that are imposed by lawin the ABL Loan Documents. No Loan Party shall, nor shall it permit its Subsidiaries to, enter into any Contractual Obligations which would prohibit a Subsidiary of Parent Company from being a Loan Party.

Restrictions on Subsidiary Distributions. Except as provided herein, no Loan Party shall, nor shall it permit any of its Subsidiaries to, create or otherwise cause or suffer to exist or become effective any consensual encumbrance or restriction of any kind on the ability of any Subsidiary of Borrower Company to (a) pay dividends or make any other distributions on any of such Subsidiary’s Capital Stock Company's Equity Interests owned by Borrower or any other Subsidiary of BorrowerCompany, (b) repay or prepay any Indebtedness owed by such Subsidiary Company to Borrower or any other Subsidiary of BorrowerCompany, (c) make loans or advances to Borrower or any other Subsidiary of BorrowerCompany, or (d) transfer any of its property or assets to Borrower or any other Subsidiary of Borrower Company other than restrictions (i) in effect on the Closing Date and set forth on Schedule 6.08, (ii) in agreements evidencing Permitted Purchase Money Indebtedness permitted by Section 6.01(k) that impose restrictions on the property so acquired, subject thereto and (iiiii) by reason of customary provisions restricting the disposition or distribution of assets, assignments, subletting, subletting or other transfers contained in leases, licenses, joint venture agreements, agreements and similar agreements entered into in the ordinary course of business, and (iiiiv) that are or were created by virtue of any transfer of, agreement to transfer, transfer or option or right with respect to any property, assets, assets or Capital Stock Equity Interests not otherwise prohibited under this Agreement, . Nothing contained in this Agreement shall prevent the U.S. Borrower and (iv) that are imposed by law. No Loan Party shall, nor shall it permit its Subsidiaries tofrom complying with their obligations under any joint venture agreement, enter into any Contractual Obligations which would prohibit a Subsidiary including, without limitation, fiduciary obligations to minority interest owners and the covenants of Parent from being a Loan Partygood faith and fair dealing.

Restrictions on Subsidiary Distributions. Except as provided hereinpursuant to any Credit Document, no Loan Credit Party shall, nor shall it permit any of its Subsidiaries to, create or otherwise cause or suffer to exist or become effective any consensual encumbrance or restriction of any kind on the ability of any Subsidiary of Borrower Company to (a) pay dividends or make any other distributions on any of such Subsidiary’s Capital Stock owned by Borrower Company or any other Subsidiary of BorrowerCompany, (b) repay or prepay any Indebtedness owed by such Subsidiary to Borrower Company or any other Subsidiary of BorrowerCompany, (c) make loans or advances to Borrower Company or any other Subsidiary of BorrowerCompany, or (d) transfer any of its property or assets to Borrower Company or any other Subsidiary of Borrower Company, in each case, other than restrictions (i) in agreements evidencing Permitted Purchase Money Indebtedness permitted by Section 6.1(b), (d), (h) and (k) (with respect to Indebtedness of Foreign Subsidiaries) that impose restrictions solely on the property so acquired, (ii) by reason of customary provisions restricting assignments, subletting, subletting or other transfers contained in leases, licenses, joint venture agreements, Joint Venture agreements and similar agreements entered into in the ordinary course of business, (iii) in the Infineum Agreement, (iv) in the Senior Subordinated Notes Documents, (v) that are or were created by virtue of any transfer of, agreement to transfer, transfer or option or right with respect to any property, assets, assets or Capital Stock not otherwise prohibited under this Agreement, and (ivvi) Liens permitted to be incurred hereunder that are imposed by law. No Loan Party shall, nor shall it permit its Subsidiaries to, enter into any Contractual Obligations which would prohibit a Subsidiary limit the right to dispose of Parent from being a Loan Partythe assets subject to such Liens.

Restrictions on Subsidiary Distributions. Except as provided herein, no Loan Party shall, nor shall it permit any of its Subsidiaries to, create or otherwise cause or suffer to exist or become effective any consensual encumbrance or restriction of any kind on the ability of any Subsidiary of Borrower to (a) pay dividends or make any other distributions on any of such Subsidiary’s Capital Stock owned by Borrower or any other Subsidiary of Borrower, (b) repay or prepay any Indebtedness owed by such Subsidiary to Borrower or any other Subsidiary of Borrower, (c) make loans or advances to Borrower or any other Subsidiary of Borrower, or (d) transfer any of its property or assets to Borrower or any other Subsidiary of Borrower other than restrictions (i) in agreements evidencing Permitted Purchase Money Indebtedness that impose restrictions on the property so acquired, (ii) by reason of customary provisions restricting assignments, subletting, or other transfers contained in leases, licenses, joint venture agreements, and similar agreements entered into in the ordinary course of business, (iii) that are or were created by virtue of any transfer of, agreement to transfer, or option or right with respect to any property, assets, or Capital Stock not otherwise prohibited under this Agreement, and (iv) that are imposed by law. No Loan Party shall, nor shall it permit its Subsidiaries to, enter into any Contractual Obligations which would prohibit a Subsidiary of Parent Holdings from being a Loan Party.

Restrictions on Subsidiary Distributions. Except as provided herein, no Loan Party shall, nor shall it permit any of its Subsidiaries to, create or otherwise cause or suffer to exist or become effective any consensual encumbrance or restriction of any kind on the ability of any Subsidiary of Borrower Company to (a) pay dividends or make any other distributions on any of such Subsidiary’s Capital Stock owned by Borrower Company or any other Subsidiary of BorrowerCompany, (b) repay or prepay any Indebtedness owed by such Subsidiary to Borrower Company or any other Subsidiary of BorrowerCompany, (c) make loans or advances to Borrower Company or any other Subsidiary of BorrowerCompany, or (d) transfer any of its property or assets to Borrower Company or any other Subsidiary of Borrower Company other than restrictions (i) in agreements evidencing purchase money Indebtedness permitted by clause (g) of the definition of Permitted Purchase Money Indebtedness that impose restrictions on the property so acquired, (ii) by reason of customary provisions restricting assignments, subletting, subletting or other transfers contained in leases, licenses, joint venture agreements, agreements and similar agreements entered into in the ordinary course of business, and (iii) that are or were created by virtue of any transfer of, agreement to transfer, transfer or option or right with respect to any property, assets, assets or Capital Stock not otherwise prohibited under this Agreement, and (iv) that are imposed by law. No Loan Party shall, nor shall it permit its Subsidiaries to, enter into any Contractual Obligations which would prohibit a Subsidiary of Parent Company from being a Loan Party.

Restrictions on Subsidiary Distributions. Except as provided herein, no Loan No Credit Party shall, nor shall it permit any of its Subsidiaries to, create or otherwise cause or suffer to exist or become effective any consensual encumbrance or restriction of any kind on the ability of any Subsidiary of Borrower GS/Landec – Credit and Guaranty Agreement Holdings to (a) pay dividends or make any other distributions on any of such Subsidiary’s Capital Stock owned by Borrower Holdings or any other Subsidiary of BorrowerHoldings, (b) repay or prepay any Indebtedness owed by such Subsidiary to Borrower Holdings or any other Subsidiary of BorrowerHoldings, (c) make loans or advances to Borrower Holdings or any other Subsidiary of BorrowerHoldings, or (d) transfer any of its property or assets to Borrower Holdings or any other Subsidiary of Borrower Holdings, in each case, other than restrictions (i) in the Credit Documents and the ABL Credit Documents, (ii) in agreements evidencing Permitted Purchase Money purchase money Indebtedness permitted by Section 6.1(i) that impose restrictions on the property so acquired, (iiiii) by reason of customary provisions restricting assignments, subletting, subletting or other transfers contained in leases, licenses, joint venture agreements, agreements and similar agreements entered into in the ordinary course of business, (iiiiv) that are or were created by virtue of any transfer of, agreement to transfer, transfer or option or right with respect to any property, assets, assets or Capital Stock not otherwise prohibited under this Agreement, and (ivv) that are restrictions and conditions imposed by law. No Loan Party shall, nor shall it permit its Subsidiaries to, enter into any Contractual Obligations which would prohibit law and (vi) that are customary restrictions and conditions contained in agreements relating to the sale of a Subsidiary of Parent from being a Loan Partypending such sale, provided such restrictions and conditions apply only to the Subsidiary that is to be sold and such sale is permitted hereunder.

Restrictions on Subsidiary Distributions. Except as provided herein, no Loan Party shall, nor shall it permit any of its Subsidiaries to, create or otherwise cause or suffer to exist or become effective any consensual encumbrance or restriction of any kind on the ability of any Subsidiary of Borrower Company to (a) pay dividends or make any other distributions on any of such Subsidiary’s 's Capital Stock owned by Borrower Company or any other Subsidiary of BorrowerCompany, (b) repay or prepay any Indebtedness owed by such Subsidiary to Borrower Company or any other Subsidiary of BorrowerCompany, (c) make loans or advances to Borrower Company or any other Subsidiary of BorrowerCompany, or (d) transfer any of its property or assets to Borrower Company or any other Subsidiary of Borrower Company other than restrictions (i) in agreements evidencing Indebtedness permitted by clause (h) of the definition of Permitted Purchase Money Indebtedness that impose restrictions on the property so acquiredacquired or subject of such Indebtedness, (ii) by reason of customary provisions restricting assignments, subletting, subletting or other transfers contained in leases, licenses, joint venture agreements, agreements and similar agreements entered into in the ordinary course of business, (iii) that are or were created by virtue of any transfer of, agreement to transfer, transfer or option or right with respect to any property, assets, assets or Capital Stock not otherwise prohibited under this Agreement, and (iv) that are in agreements entered into in the ordinary course of business in accordance with customary industry practice or (v) on net worth imposed by lawcustomers or suppliers under contracts entered into in the ordinary course of business in accordance with customary industry practice. No Loan Party shall, nor shall it permit its Subsidiaries to, enter into any Contractual Obligations which would prohibit a Domestic Subsidiary of Parent Company from being a Loan Party.

Restrictions on Subsidiary Distributions. Except as provided herein, no Loan Party shallCompany shall not, nor shall it permit any of its Subsidiaries to, create or otherwise cause or suffer to exist or become effective any consensual encumbrance or restriction of any kind on the ability of any Subsidiary of Borrower Company to (a) pay dividends or make any other distributions on any of such Subsidiary’s 's Capital Stock owned by Borrower Company or any other Subsidiary of BorrowerCompany, (b) repay or prepay any Indebtedness owed by such Subsidiary to Borrower Company or any other Subsidiary of BorrowerCompany, (c) make loans or advances to Borrower Company or any other Subsidiary of BorrowerCompany, or (d) transfer any of its property or assets to Borrower Company or any other Subsidiary of Borrower Company other than restrictions (i) in agreements evidencing Permitted Purchase Money Indebtedness permitted by Section 6.1(i) or Section 6.1(j) that impose restrictions on the property so acquired, securing such Indebtedness as permitted by Section 6.2(m); (ii) by reason of customary provisions restricting assignments, subletting, subletting or other transfers contained in leases, licenses, joint venture agreements, agreements and similar agreements entered into in the ordinary course of business, ; (iii) that are or were created by virtue of any transfer of, agreement to transfer, transfer or option or right with respect to any property, assets, assets or Capital Stock not otherwise prohibited under this Agreement, and ; (iv) that in the Senior Subordinated Note Documents (and Permitted Refinancings of the Senior Subordinated Notes; provided such restrictions contained in such Permitted Refinancings are imposed by law. No Loan Party shallno more burdensome than those contained in the Senior Subordinated Note Documents); and (v) restrictions contained in documents governing Indebtedness of Foreign Subsidiaries permitted hereunder, nor shall it permit its solely with respect to the Foreign Subsidiaries to, enter into any Contractual Obligations which would prohibit a Subsidiary of Parent from being a Loan Partyobligated on such Indebtedness (and Foreign Subsidiaries thereof).

Restrictions on Subsidiary Distributions. Except as provided hereinherein and as provided in the Second Lien Credit Agreement, no Loan Credit Party shall, nor shall it permit any of its Subsidiaries to, create or otherwise cause or suffer to exist or become effective any consensual encumbrance or restriction of any kind on the ability of any Subsidiary of Borrower Xerium to (a) pay dividends or make any other distributions on any of such Subsidiary’s Capital Stock owned by Borrower Xerium or any other Subsidiary of BorrowerXerium, (b) repay or prepay any Indebtedness owed by such Subsidiary to Borrower Xerium or any other Subsidiary of BorrowerXerium, (c) make loans or advances to Borrower Xerium or any other Subsidiary of BorrowerXerium, or (d) transfer any of its property or assets to Borrower Xerium or any other Subsidiary of Borrower Xerium, other than restrictions (i) in agreements evidencing Permitted Purchase Money Indebtedness permitted by Section 6.1(k) that impose restrictions on the property so acquired, ; (ii) by reason of customary provisions restricting assignments, subletting, subletting or other transfers contained in leases, licenses, joint venture agreements, agreements and similar agreements entered into in the ordinary course of business, Ordinary Course; (iii) that are or were created by virtue of any transfer of, agreement to transfer, transfer or option or right with respect to any property, assets, assets or Capital Stock not otherwise prohibited under this Agreement, and ; (iv) in any agreement for the sale or other disposition of a Subsidiary that are imposed restricts distributions by law. No Loan Party shall, nor shall it permit that Subsidiary pending the sale or other disposition; (v) in provisions in agreements or instruments which prohibit the payment of dividends or the making of other distributions with respect to any class of Capital Stock of a Person other than on a pro rata basis; and (vi) in any instrument governing Indebtedness or Capital Stock of a Person acquired by Xerium or any of its Subsidiaries toas in effect at the time of such acquisition (except to the extent such Indebtedness or Capital Stock was incurred in connection with or in contemplation of such acquisition), enter into which encumbrance or restriction is not applicable to any Contractual Obligations which would prohibit a Subsidiary Person, or the properties or assets of Parent from being a Loan Partyany Person, other than the Person or the property or assets of the Person, so acquired, provided that, in the case of Indebtedness, such Indebtedness was permitted by Section 6.1.

Restrictions on Subsidiary Distributions. Except as provided herein, no Loan Party shall, nor shall it permit any of its Borrower’s Subsidiaries to, create or otherwise cause or suffer to exist or become effective any consensual encumbrance or restriction of any kind on the ability of any Subsidiary of Borrower Company to (a) pay dividends or make any other distributions on any of such Subsidiary’s Capital Stock owned by Borrower Company or any other Subsidiary of BorrowerCompany, (b) repay or prepay any Indebtedness owed by such Subsidiary to Borrower Company or any other Subsidiary of BorrowerCompany, (c) make loans or advances to Borrower Company or any other Subsidiary of BorrowerCompany, or (d) transfer any of its property or assets to Borrower Company or any other Subsidiary of Borrower Company other than restrictions (i) in agreements evidencing purchase money Indebtedness permitted by clause (h) of the definition of Permitted Purchase Money Indebtedness that impose restrictions on the property so acquired, (ii) by reason of customary provisions restricting assignments, sublettingchange of control, subletting or other transfers contained in leases, licenses, joint venture agreements, agreements and similar other agreements entered into in the ordinary course of businessbusiness or as expressly permitted by this Agreement, and (iii) that are or were created by virtue of any transfer of, agreement to transfer, transfer or option or right with respect to any property, assets, assets or Capital Stock not otherwise prohibited under this Agreement, and (iv) that are imposed by law. No Loan Party shall, nor shall it permit its Subsidiaries to, enter into any Contractual Obligations which would prohibit a Subsidiary of Parent Borrower from being a Loan PartyParty (other than Subsidiaries that are Excluded Subsidiaries, other than by virtue of clause (e) or (f) of the definition thereof).

Restrictions on Subsidiary Distributions. Except as provided herein, no Loan Party shall, nor shall it permit any of its Subsidiaries to, create or otherwise cause or suffer to exist or become effective any consensual encumbrance or restriction of any kind on the ability of any Subsidiary of Borrower Company to (a) pay dividends or make any other distributions on any of such Subsidiary’s Capital Stock owned by Borrower Company or any other Subsidiary of BorrowerCompany, (b) repay or prepay any Indebtedness owed by such Subsidiary to Borrower Company or any other Subsidiary of BorrowerCompany, (c) make loans or advances to Borrower Company or any other Subsidiary of BorrowerCompany, or (d) transfer any of its property or assets to Borrower Company or any other Subsidiary of Borrower Company other than restrictions (i) in agreements evidencing purchase money Indebtedness permitted by clause (d) of the definition of Permitted Purchase Money Indebtedness that impose restrictions on the property so acquired, (ii) by reason of customary provisions restricting assignments, subletting, subletting or other transfers contained in leases, licenses, joint venture agreements, agreements and similar agreements entered into in the ordinary course of business, and (iii) that are or were created by virtue of any transfer of, agreement to transfer, transfer or option or right with respect to any property, assets, assets or Capital Stock not otherwise prohibited under this Agreement, and (iv) that are imposed by law. No Loan Party shall, nor shall it permit its Subsidiaries to, enter into any Contractual Obligations which would prohibit a Subsidiary of Parent Company from being a Loan Party.

Restrictions on Subsidiary Distributions. Except as provided herein, no Loan Party shall, nor shall it permit any of its Subsidiaries to, create or otherwise cause or suffer to exist or become effective any consensual encumbrance or restriction of any kind on the ability of any Subsidiary of Borrower Company to (a) pay dividends or make any other distributions on any of such Subsidiary’s Capital Stock owned by Borrower Company or any other Subsidiary of BorrowerCompany, (b) repay or prepay any Indebtedness owed by such Subsidiary to Borrower Company or any other Subsidiary of BorrowerCompany, (c) make loans or advances to Borrower Company or any other Subsidiary of BorrowerCompany, or (d) transfer any of its property or assets to Borrower Company or any *** Certain confidential information has been omitted and filed separately with the Commission. Confidential treatment has been requested with respect to the omitted portions. other Subsidiary of Borrower Company other than restrictions (i) in agreements evidencing (x) purchase money Indebtedness permitted by clause (h) of the definition of Permitted Purchase Money Indebtedness and (y) Indebtedness in respect of floorplan financings permitted by clause (i) of the definition of Permitted Indebtedness, in each case, that impose restrictions on the property so acquired, (ii) by reason of customary provisions restricting assignments, subletting, subletting or other transfers contained in leases, licenses, joint venture agreements, agreements and similar agreements entered into in the ordinary course of business, (iii) that are or were created by virtue of any transfer of, agreement to transfer, transfer or option or right with respect to any property, assets, assets or Capital Stock not otherwise prohibited under this Agreement, and (iv) that are imposed by lawin the ABL Loan Documents. No Loan Party shall, nor shall it permit its Subsidiaries to, enter into any Contractual Obligations which would prohibit a Subsidiary of Parent Company from being a Loan Party.