Limitation on Disposition of Property Dispose of any of its Property (including, without limitation, receivables and leasehold interests), whether now owned or hereafter acquired, or, in the case of any Restricted Subsidiary, issue or sell any shares of such Restricted Subsidiary’s Capital Stock to any Person, except:
(a) the Disposition of (i) cash, Cash Equivalents or Investment Grade Securities or (ii) other Property that the Company (or any Restricted Subsidiary of the Company) reasonably determines is no longer used or useful in its business, has become obsolete, damaged or surplus or is replaced in the ordinary course of business, including the lease or sublease of excess or unneeded real property not constituting a sale and leaseback;
(b) the sale of inventory in the ordinary course of business;
(c) Dispositions permitted by Section 7.04(b); provided that promptly after any such Disposition of any Property to the Company or a Subsidiary Guarantor, all actions reasonably required by the Collateral Agent shall be taken to insure the perfection and priority of the Liens created by the Security Documents on such Property;
(d) the sale or issuance of any Restricted Subsidiary’s Capital Stock to the Company or any Subsidiary Guarantor or in the case of any Restricted Subsidiary that is not a Subsidiary Guarantor, to any other Restricted Subsidiary;
(e) Dispositions from (i) the Company or a Subsidiary Guarantor to the Company or another Subsidiary Guarantor; provided that promptly after any such Disposition, all actions reasonably requested by the Collateral Agent shall be taken to insure the continued perfection and priority of the Liens created by the Security Documents on such Property and assets, (ii) from a Restricted Subsidiary that is not a Subsidiary Guarantor to the Company or any other Restricted Subsidiary or (iii) from a Loan Party to a Restricted Subsidiary that is not a Loan Party;
(f) discounts, adjustments or forgiveness of accounts receivable and other contract claims in the ordinary course of business or in connection with collection or compromise thereof;
(g) subject to the proviso below, unlimited Dispositions for Fair Market Value;
(h) any Recovery Event;
(i) Dispositions resulting from any taking or condemnation of any property of the Company or any of its Restricted Subsidiaries;
(j) Sale and Lease-Back Transactions permitted under Section 7.10;
(k) to the extent constituting Dispositions, Investments permitted under Section 7.07 and Restricted Payments permitted under Section 7.06;
(l) the sale (without recourse) of receivables (and related assets) pursuant to factoring or other receivables sale arrangements and similar financing programs;
(m) assignments and licenses of intellectual property of the Company and its Restricted Subsidiaries in the ordinary course of business; and
(n) the purchase and sale or other transfer (including by capital contribution) of Securitization Assets or interests therein pursuant to any Permitted Securitization Financing; provided, that in the case of a Specified Disposition, the Company would, immediately after giving effect to such Specified Disposition be in compliance with the Financial Covenants, determined on a Pro Forma Basis giving effect to such Specified Disposition as of the last day of the most recently ended Test Period (and assuming for such purposes the repayment of any Indebtedness repaid, tendered, repurchased, redeemed, defeased or discharged in connection with such Specified Disposition), provided, further, that, with respect to paragraph (g) above, no Default or Event of Default exists or will result therefrom and at least 75% of the consideration received therefor by the Company or such Restricted Subsidiary in excess of $10,000,000 for any individual Disposition (or series of related Dispositions) shall be in the form of cash or Cash Equivalents, provided further that for purposes of this proviso, each of the following shall be deemed to be cash: (i) the amount of any liabilities (as shown on the Company’s or any Restricted Subsidiary’s most recent balance sheet or in the notes thereto) that are assumed by the transferee of any such assets or are otherwise cancelled in connection with such transaction (other than any such liabilities that are subordinated to the Obligations), (ii) any notes or other obligations or other securities or assets received by the Company or such Restricted Subsidiary from such transferee that are converted by the Company or such Restricted Subsidiary into cash or Cash Equivalents within 180 days of the receipt thereof (to the extent of the cash or Cash Equivalents received) and (iii) any Designated Non-Cash Consideration received by the Company or any of its Restricted Subsidiaries in such Disposition having an aggregate Fair Market Value, taken together with all other Designated Non-Cash Consideration received pursuant to clause (g) that is at that time outstanding, not to exceed $25,000,000, 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. For the avoidance of doubt, any issuance or sale of Capital Stock of the Company shall not be subject to the restrictions set forth in this Section 7.05.
Disposition of Property Dispose of any of its property, whether now owned or hereafter acquired, or, in the case of any Subsidiary, issue or sell any shares of such Subsidiary’s Capital Stock to any Person, except:
(a) the Disposition of (i) obsolete or worn out property or (ii) any property that is no longer used or useful in the conduct of the business of the Borrower or its Subsidiaries, in each case in the ordinary course of business;
(b) the Disposition of inventory in the ordinary course of business;
(c) Dispositions permitted by clause (i) of Section 7.4(b), Investments permitted under Section 7.7 (other than Section 7.7 (m)) and Restricted Payments permitted under Section 7.6;
(d) the sale or issuance of any Subsidiary’s Capital Stock to the Borrower or any Wholly Owned Subsidiary; provided that any sale or issuance of any Subsidiary Guarantor’s Capital Stock shall only be to the Borrower or another Subsidiary Guarantor;
(e) Dispositions of any Related Eligible Assets (i) in connection with the AESOP Financing Program or the Centre Point Financing Program, (ii) to any Securitization Entity or (iii) in connection with the incurrence of any Securitization Indebtedness;
(f) the sale of the Budget Truck Division for fair market value as determined by the board of directors of the Borrower;
(g) the Disposition of other property having a fair market value not to exceed $1,000,000,000 in the aggregate for any fiscal year of the Borrower;
(h) the Dispositions listed on Schedule 7.5(h);
(i) Dispositions of properties subject to condemnation, eminent domain or taking;
(j) leases, subleases, licenses and sublicenses of real or personal property, and Intellectual Property in the ordinary course of business, and any intercompany licenses and sublicenses of Intellectual Property;
(k) dispositions or use of cash and Cash Equivalents in the ordinary course of business;
(l) the abandonment, termination or other disposition of Intellectual Property or leasehold properties in the ordinary course of business; and
(m) dispositions, discounts or forgiveness of accounts receivable in connection with the collection or compromise thereof;
(n) Dispositions of non-core assets acquired in connection with an Investment permitted under Section 7.7, including a Specified Transaction;
(o) Dispositions by the Borrower or any of its Subsidiaries of any Foreign Subsidiary to any other Foreign Subsidiary so long as at least 65% of the Capital Stock of such other Foreign Subsidiary (or any parent company of such other Foreign Subsidiary) is pledged to the Administrative Agent pursuant to Section 6.9;
(p) Dispositions of minority interests in joint ventures; and
(q) any Disposition of any Foreign Subsidiary and any holding company formed in connection with the Avis Europe Acquisition to the Borrower or any of its Subsidiaries. provided that all Dispositions permitted under paragraphs (f) and (g)(i) and (g)(ii) of this Section 7.5 shall be made for fair value and in the case of any such Disposition (or series of related Dispositions) that yields gross proceeds to any Loan Party in excess of $25,000,000, for at least 75% cash consideration (excluding, in the case of an Asset Sale (or series of related Asset Sales), any consideration by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise, that are not Indebtedness) (it being understood that for the purposes of the foregoing proviso, the following shall be deemed to be cash consideration: (1) Cash Equivalents, (2) the assumption of Indebtedness of the Borrower (other than Disqualified Stock of the Borrower) or any Subsidiary and the release of the Borrower and its Subsidiaries from all liability with respect to payment of such Indebtedness, (3) Indebtedness of any Subsidiary that is no longer a Subsidiary as a result of such Disposition, to the extent that the Borrower and each other Subsidiary are released from any Guarantee Obligations or any other obligations to provide credit support in respect of such Indebtedness and (4) securities received by the Borrower or any Subsidiary from the transferee that are converted by the Borrower or such Subsidiary into cash within 180 days); provided, further, that if the Group Member’s action or event meets the criteria of more than one of the types of Dispositions described in the clauses above, the Borrower in its sole discretion may classify (and reclassify) such action or event in one or more clauses (including in part under one such clause and in part under another such clause).
Permitted Dispositions Each Credit Party will not, and will not permit any of its Subsidiaries, to make a Disposition, or enter into any agreement to make a Disposition not permitted under this Section 10.04 (unless such agreement is conditioned on the repayment in full of the Obligations and termination of this Agreement or receipt of consent by the applicable Lenders), of such Credit Party’s or such other Person’s assets (including Accounts Receivable and Capital Stock of Subsidiaries) to any Person in one transaction or a series of transactions unless such Disposition:
(a) is of obsolete or worn out property or property no longer used or useful in its business; or
(b) is for fair market value and the following conditions are met:
(i) to the extent required by Section 5.02(a)(iii), the Borrower has applied any Net Disposition Proceeds arising therefrom pursuant to Section 5.02(a)(iii);
(ii) no less than seventy-five percent (75%) of the consideration received for such Disposition is received in cash or Cash Equivalents;
(iii) such Dispositions shall not exceed $5,000,000 in the aggregate since the Closing Date; and
(iv) no Default or Event of Default shall have occurred and be continuing or would result from the Disposition thereof,
(c) is a sale of inventory in the ordinary course of business;
(d) is the leasing, as lessor, subleasing or licensing of real or personal property (including the provision of software under an open source license) or in each case termination thereof which (A) do not materially interfere with the business of the Borrower and its Subsidiaries or (B) relate to closed facilities;
(i) is a sale or disposition of property to the extent that such property is exchanged for credit against the purchase price of similar replacement property, or the proceeds of such Dispositions are reasonably promptly applied to the purchase price of similar replacement property, all in the ordinary course of business in accordance with Section 5.02(a)(iii) or (ii) is the contemporaneous exchange, in the ordinary course of business, of property for property of a like kind, to the extent that property received in such exchange is of a fair market value equal to or greater than the fair market value of the property exchanged;
(f) is expressly otherwise permitted by Section 10.05 or 10.06;
(g) is by (i) any Credit Party (other than Holdings) or Subsidiary thereof to any other Credit Party or Subsidiary, other than Holdings; provided that the aggregate amount of assets that may be sold or otherwise disposed of by any Credit Party to any Subsidiary that is not a Credit Party (x) shall be for fair market value and (y) shall not exceed $1,000,000 in any fiscal year or otherwise with the prior written consent of the Administrative Agent, which shall not be unreasonably withheld, conditioned or delayed, (ii) any Subsidiary of a Credit Party (other than the Borrower) to any Credit Party, other than Holdings, or (iii) any Subsidiary that itself is not a Credit Party to any other Subsidiary that itself is not a Credit Party;
(h) cancellations of any intercompany Indebtedness among the Credit Parties;
(i) is (i) the non-exclusive licensing of non-material Intellectual Property to third Persons in the ordinary course of business, (ii) the transfer, abandonment, lapse or other disposition of Intellectual Property that is, in the applicable Credit Party’s reasonable business judgment, not material to the business and no longer economically practicable or commercially desirable to maintain, or used or useful in its business, in each case, in the ordinary course of business, or (iii) the expiration of Intellectual Property in accordance with its maximum statutory term;
(j) the sale, lease, sub-lease, license, sub-license or consignment of personal property of the Credit Parties or their Subsidiaries in the ordinary course of business consistent with past practice and leases or subleases of real property permitted by clause (a) for which rentals are paid on a periodic basis over the term thereof;
(k) the settlement or write-off of Accounts Receivable or sale, discount or compromise of overdue Accounts Receivable for collection (i) in the ordinary course of business consistent with past practice and (ii) with respect to Accounts Receivable acquired with a Permitted Acquisition, consistent with prudent business practice;
(l) use or exchange of cash and Cash Equivalents in the ordinary course of business;
(m) to the extent required by Applicable Law, the sale or other disposition of a nominal amount of Capital Stock in any Subsidiary in order to qualify members of the board of directors or equivalent governing body of such Subsidiary;
(n) Dispositions constituting a taking by condemnation or eminent domain or transfer in lieu thereof, or a Disposition consisting of or subsequent to a total loss or constructive total loss or property, in each case, provided that to the extent required by Section 5.02(a)(vii), the Borrower has applied any Net Casualty Proceeds arising therefrom pursuant to Section 5.02(a)(vii);
(o) sales of non-core assets (“non-core assets” to be determined by the Borrower in the exercise of its reasonable good faith business judgment) acquired with a Permitted Acquisition or other Investment permitted hereunder and sales of real property acquired in connection with a Permitted Acquisition, in each case, shall be (i) sold entirely for cash consideration and for fair market value, (ii) sold to a non-Affiliate of the Sponsor or the Borrower and (iii) designated in writing to the Administrative Agent within ninety (90) days of the acquisition thereof as being held for sale and not for the continued operation of the Borrower or any of its Subsidiaries or any of their respective businesses;
(p) unwinding of Hedging Agreements or cash management agreements in the ordinary course of business;
(q) any grant of an option to purchase, lease or acquire property in the ordinary course of business, so long as such Disposition resulting from the exercise of such option would otherwise be permitted under this Section 10.04;
(r) the surrender or waiver of contractual rights or the settlement, release or surrender of contract, tort or other litigation claims in the ordinary course of business;
(s) the granting, creation or existence of a Permitted Lien, and any dispositions of assets pursuant to an exercise of remedies, including by way of foreclosure, against the underlying assets subject to such Permitted Liens;
(t) dispositions of Investments in joint ventures to the extent required by, or made pursuant to, buy/sell arrangements between joint venturers or similar parties set forth in the relevant joint venture arrangements and/or similar binding arrangements;
(u) the sale or issuance of any Subsidiary’s Capital Stock to Borrower or a Credit Party or any Subsidiary that is the direct parent of such Subsidiary;
(v) [reserved];
(i) termination of leases or subleases in the ordinary course of business; (ii) the expiration of any option agreement in respect of real or personal property, or (iii) any surrender or waiver of contractual rights or the settlement, release or surrender of contractual rights or other litigation claims in the ordinary course of business; and
(x) other Dispositions by any Credit Party in an amount not to exceed $1,000,000 during each fiscal year; provided, that, notwithstanding the foregoing, in no event shall any Credit Party, or shall any Credit Party permit any of its Subsidiaries to, directly or indirectly, (i) file a certificate of division, adopt a plan of division or otherwise take any action to effectuate a division pursuant to Section 18-217 of the Delaware Limited Liability Company Act (or any analogous action taken pursuant to Applicable Law with respect to any corporation, limited liability company, partnership or other entity) unless such transaction is otherwise permitted hereunder or the divided entity becomes a Credit Party substantially concurrently with such division or (ii) make any Dispositions of any material Intellectual Property of any Credit Party to any Person that is not a Credit Party.