Common use of Subsidiaries; Partnerships Clause in Contracts

Subsidiaries; Partnerships. (a) Form any Domestic Subsidiary unless, (i) such Subsidiary expressly becomes a Borrower and becomes jointly and severally liable for the Obligations, (ii) the Borrower which is the parent entity of such Subsidiary pledges, in accordance with Section 4.20, the Equity Interest of such Subsidiary to the Agent, for the benefit of the Agent and the Lenders, so that such Subsidiary’s Equity Interest becomes Pledged Securities, (iii) the Agent shall have received all documents, including organizational documents and legal opinions it may reasonably require in connection therewith, including, without limitation, all information that may be reasonably requested by the Agent to comply with applicable “know your customer” requirements established by U.S. regulatory authorities (including without limitation pursuant to the Beneficial Ownership Regulation), and (iv) such Subsidiary grants first priority perfected Liens in its assets to the Agent, for the benefit of the Agent and the Lenders (subject to Permitted Encumbrances); provided, however, to the extent such Subsidiary becomes a Borrower, none of such assets which become Collateral shall be included in the Borrowing Base in accordance with the terms of this Agreement until such time as the Agent makes such determination in its Permitted Discretion unless (A) they meet the eligibility requirements contained in this Agreement and (B) the Agent has conducted a Collateral audit and appraisal with respect to such assets; (b) Form any Foreign Subsidiary unless the Borrower which is the parent entity of such Subsidiary pledges, in accordance with Section 4.20, the applicable percentage the Equity Interest of such Subsidiary to the Agent, for the benefit of the Agent and the Lenders, so that such percentage of such Subsidiary’s Equity Interest becomes Pledged Securities; or (c) Enter into any partnership, joint venture or similar agreement.

Subsidiaries; Partnerships. ESCO will not have any direct Subsidiaries other than the Borrower and any Restricted Subsidiaries. The Borrower will not have any direct or indirect Subsidiaries, other than the Specified Subsidiaries and any Subsidiaries resulting from any Investments made in accordance with clause (af), (l), or (n) Form of Section 5.16 and any Domestic Subsidiary unlessrestricted Subsidiaries, all of which shall be direct Subsidiaries (except that (i) such PPD shall be a direct Subsidiary expressly becomes a Borrower and becomes jointly and severally liable for the Obligationsof SFL, (ii) the Borrower which is the parent entity Comtrak shall be a direct Subsidiary of such Subsidiary pledges, in accordance with Section 4.20, the Equity Interest of such Subsidiary to the Agent, for the benefit of the Agent and the Lenders, so that such Subsidiary’s Equity Interest becomes Pledged SecuritiesSEI, (iii) EMC Test Systems shall be a limited partnership as described in the Agent definition of "EMC Test Systems Reorganization", (iv) Rantec shall have received all documentsbe a direct Subsidiary of Rantec Holding as described in the definition of "EMC Test Systems Reorganization", including organizational documents (v) Rantec Commercial shall be a direct Subsidiary of Rantec as described in the definition of "EMC Test Systems Reorganization", (vi) FBV, FGMBH, Filtrotec, FDPR and legal opinions it may reasonably require in connection therewithFDB shall be direct subsidiaries of Filtertek, including(vii) FSA shall be a subsidiary of Filtertek and FBV, without limitationand (vii) Euroshield shall be a subsidiary of Euroshield Acquisition Corporation). Neither ESCO nor the Borrower will, all information that may be reasonably requested by the Agent to comply with applicable “know your customer” requirements established by U.S. regulatory authorities (including without limitation pursuant and they will not permit any of their Subsidiaries to, enter into any partnership or joint venture other than EMC Test Systems, PTI Filters and a Permitted Joint Venture. Notwithstanding anything to the Beneficial Ownership Regulation)Contrary contained in this Section (i) Uniexcel shall be a partially-owned Subsidiary of SFL, (ii) Filtertek de Puerto Rico S.A. may issue Class B Common Stock to certain of its senior executives, (iii) Filtertek may own less than all of, but not less than 85% of, the outstanding common stock of FDB and (iv) such Subsidiary grants first priority perfected Liens in its assets to the Agent, for the benefit PTI may own not less than 40% and not more than 49% of the Agent and the Lenders (subject to Permitted Encumbrances); provided, however, to the extent such Subsidiary becomes a Borrower, none outstanding common stock of such assets which become Collateral shall be included in the Borrowing Base in accordance with the terms of this Agreement until such time as the Agent makes such determination in its Permitted Discretion unless (A) they meet the eligibility requirements contained in this Agreement and (B) the Agent has conducted a Collateral audit and appraisal with respect to such assets; (b) Form any Foreign Subsidiary unless the Borrower which is the parent entity of such Subsidiary pledges, in accordance with Section 4.20, the applicable percentage the Equity Interest of such Subsidiary to the Agent, for the benefit of the Agent and the Lenders, so that such percentage of such Subsidiary’s Equity Interest becomes Pledged Securities; or (c) Enter into any partnership, joint venture or similar agreementPTI Filters.