Common use of Excluded Subsidiaries Clause in Contracts

Excluded Subsidiaries. (i) In the event that, at any time, Excluded Subsidiaries that are not Obligors have, in the aggregate, (A) total Revenues constituting five percent (5.00%) or more of the total Revenues of Borrower and its Subsidiaries on a consolidated basis, or (B) total assets constituting five percent (5.00%) or more of the total assets of Borrower and its Subsidiaries on a consolidated basis, promptly (and, in any event, within thirty (30) days after such time (or such longer time as consented to in writing by Administrative Agent)) Obligors shall cause one or more of such Excluded Subsidiaries to become Subsidiary Guarantors in the manner set forth in Section 8.12(a), such that, after such Subsidiaries become Subsidiary Guarantors, the non-guarantor Excluded Subsidiaries in the aggregate shall cease to have Revenues or assets, as applicable, that meet the thresholds set forth in clauses (A) and (B) above; provided, that, no Excluded Subsidiary shall be required to become a Subsidiary Guarantor if doing so would result in material adverse tax consequences for Borrower and its Subsidiaries, taken as a whole. (ii) With respect to each First-Tier Excluded Subsidiary, such Obligor shall grant a security interest and Lien in sixty five percent (65.00%) of each class of voting Equity Interests and 100% of all other Equity Interests in such First-Tier Excluded Subsidiary in favor of the Secured Parties as Collateral for the Obligations, in each case including entering into any necessary local law security documents and delivery of certificated securities issued by such First-Tier Excluded Subsidiary as required by this Agreement or the Security Agreement. Without limiting the generality of the foregoing, in the event that any Obligor shall form or acquire any new Subsidiary that is a First-Tier Excluded Subsidiary, such Obligor will promptly and in any event within thirty (30) days of the formation or acquisition of such Subsidiary (or such longer time as consented to by Administrative Agent in writing) grant a security interest and Lien in sixty five percent (65.00%) of each class of voting Equity Interests and one hundred percent (100.00%) of all other Equity Interests in such First-Tier Excluded Subsidiary in favor of the Secured Parties as Collateral for the Obligations, in each case including entering into any necessary local law security documents and delivery of certificated securities issued by such First-Tier Excluded Subsidiary as required by this Agreement or the Security Agreement. (iii) For the purposes of this Section 8.12(b), the determination of whether a “material adverse tax consequence” shall be deemed to result from any Foreign Subsidiary becoming a Subsidiary Guarantor shall be made by Administrative Agent in its reasonable discretion, following consultation with Borrower, taking into consideration and weighing, among others, the following relevant factors: (1) the magnitude of an increase in Borrower’s tax liability or a reduction in Borrower’s net operating loss carryforward, taken as a whole; (2) the amount of revenues generated by or assets accumulated at such Foreign Subsidiary compared with those generated by or accumulated at the Obligors; (3) whether the Loans are over- or under-collateralized; (4) the financial performance of Borrower and its Subsidiaries, taken as a whole, and the Obligors’ ability to perform the Obligations (other than Warrant Obligations) at such time; and (5) the cost to Borrower and its Subsidiaries balanced against the practical benefit to the Lenders (it being understood that the Administrative Agent shall give heavier weight to the factors set forth in clauses (2) and (3)).

Excluded Subsidiaries. (a) If at any time (x) the aggregate cash or Cash Equivalent Investments attributable to all Excluded Subsidiaries except for Excluded Subsidiaries excluded pursuant to clause (C) of the definition of “Excluded Subsidiary” exceeds $5,000,000, the Borrower shall (i) In designate sufficient applicable Subsidiaries as “Guarantors” to eliminate such excess, and such designated Subsidiaries shall for all purposes of this Agreement constitute Guarantors and be subject to the event thatprovisions of Section 7.8, at any time, Excluded Subsidiaries that are not Obligors have, or (ii) immediately repatriate cash and/or Cash Equivalent Investments in the aggregatean aggregate amount sufficient to eliminate such excess, (Ay) total Revenues constituting five percent (5.00%) or more the aggregate portion of the total Revenues Revenue attributable to (I) an Excluded Subsidiary exceeds 5.0% of the Revenue of the Borrower and its Subsidiaries on a consolidated basis, or (BII) all Excluded Subsidiaries except for Excluded Subsidiaries excluded pursuant to clause (C) of the definition of “Excluded Subsidiary” exceeds 10.0% of the Revenue of the Borrower and its Subsidiaries, as applicable, in each case for any period of four consecutive Fiscal Quarters (determined as of the last day of the most recent Fiscal Quarter for which financial statements have been delivered pursuant to Section 7.1(b) or Section 7.1(c) (or, if prior to the date of the delivery of the first financial statements to be delivered pursuant to Section 7.1(b) or Section 7.1(c), the most recent financial statements referred to in Section 5.6)), the Borrower shall designate such applicable Excluded Subsidiary or sufficient applicable Subsidiaries as “Guarantors” to eliminate such excess, and such designated Subsidiaries shall for all purposes of this Agreement constitute Guarantors and be subject to the provisions of Section 7.8 or (z) the aggregate portion of total assets constituting five percent attributable to (5.00%I) or more an Excluded Subsidiary exceeds 5.0% of the consolidated total assets of the Borrower and its Subsidiaries on a consolidated basis, promptly or (and, in any event, within thirty (30II) days after such time (or such longer time as consented to in writing by Administrative Agent)) Obligors shall cause one or more of such all Excluded Subsidiaries to become Subsidiary Guarantors in the manner set forth in Section 8.12(a), such that, after such Subsidiaries become Subsidiary Guarantors, the non-guarantor except for Excluded Subsidiaries in excluded pursuant to clause (C) of the aggregate shall cease to have Revenues or assetsdefinition of “Excluded Subsidiary” exceeds 10.0% of the consolidated total assets of the Borrower and its Subsidiaries, as applicable, that in each case for any period of four consecutive Fiscal Quarters (determined as of the last day of the most recent Fiscal Quarter for which financial statements have been delivered pursuant to Section 7.1(b) or Section 7.1(c) (or, if prior to the date of the delivery of the first financial statements to be delivered pursuant to Section 7.1(b) or Section 7.1(c), the most recent financial statements referred to in Section 5.6)), the Borrower shall designate such applicable Excluded Subsidiary or sufficient applicable Subsidiaries as “Guarantors” to eliminate such excess, and such designated Subsidiaries shall for all purposes of this Agreement constitute Guarantors and be subject to the provisions of Section 7.8. (b) Should (x) an Excluded Subsidiary cease to meet the thresholds criteria set forth in clauses (i), (ii) or (iii) of clause (A) and of the definition thereof, (By) above; provided, that, no an Excluded Subsidiary shall hold any exclusive right, title or interest in any material Core Asset or (z) should any not-for-profit Subsidiary (including ▇▇▇▇▇ Molecular Pathology) no longer constitute or be required to become a Subsidiary Guarantor if doing so would result in material adverse tax consequences for Borrower and its Subsidiaries, taken qualified as a whole“non-for-profit” Person in its jurisdiction of organization, in each case, the Borrower shall designate such Subsidiary as a “Guarantor”, and such Subsidiary shall for all purposes of this Agreement constitute a Guarantor and be subject to the provisions of Section 7.8. (iic) With respect On or prior to each First-Tier Excluded Subsidiary, such Obligor shall grant a security interest and Lien in sixty five percent (65.00%) of each class of voting Equity Interests and 100% of all other Equity Interests in such First-Tier Excluded Subsidiary in favor of the Secured Parties as Collateral for the Obligations, in each case including entering into any necessary local law security documents and delivery of certificated securities issued by such First-Tier Excluded Subsidiary as required by this Agreement or the Security Agreement. Without limiting the generality of the foregoing, in the event that any Obligor shall form or acquire any new Subsidiary date that is a First-Tier Excluded Subsidiary, such Obligor will promptly and in any event within thirty (30) 90 days of after the formation or acquisition of such Subsidiary (Closing Date or such longer time period as consented to by Administrative Agent in writing) grant a security interest and Lien in sixty five percent (65.00%) of each class of voting Equity Interests and one hundred percent (100.00%) of all other Equity Interests in such First-Tier Excluded Subsidiary in favor of the Secured Parties as Collateral for the Obligations, in each case including entering into any necessary local law security documents and delivery of certificated securities issued by such First-Tier Excluded Subsidiary as required by this Agreement or the Security Agreement. (iii) For the purposes of this Section 8.12(b), the determination of whether a “material adverse tax consequence” shall be deemed to result from any Foreign Subsidiary becoming a Subsidiary Guarantor shall be made by Administrative Agent in its reasonable discretion, following consultation with Borrower, taking into consideration and weighing, among others, the following relevant factors: (1) the magnitude of an increase in Borrower’s tax liability or a reduction in Borrower’s net operating loss carryforward, taken as a whole; (2) the amount of revenues generated by or assets accumulated at such Foreign Subsidiary compared with those generated by or accumulated at the Obligors; (3) whether the Loans are over- or under-collateralized; (4) the financial performance of Borrower and its Subsidiaries, taken as a whole, and the Obligors’ ability to perform the Obligations (other than Warrant Obligations) at such time; and (5) the cost to Borrower and its Subsidiaries balanced against the practical benefit to the Lenders (it being understood that the Administrative Agent and the Required Lenders may agree in their sole discretion, the Borrower shall give heavier weight cause ▇▇▇▇▇ Research Institute, Inc. to comply with the factors set forth in clauses (2) requirements of Section 7.8 or to be dissolved. From the Closing Date until ▇▇▇▇▇ Research Institute, Inc. either dissolves or complies with the requirements of Section 7.8, it shall be a dormant company with no operations, no assets and (3))no liabilities.

Excluded Subsidiaries. (i) In the event that, The aggregate cash or Cash Equivalent Investments attributable to all Excluded Subsidiaries shall not exceed $250,000. If at any time, time the aggregate portion of net revenue attributable to all Excluded Subsidiaries that are not Obligors have, in the aggregate, (A) total Revenues constituting five percent (5.00%) or more exceeds 4.0% of the total Revenues net revenue of the Borrower and its Subsidiaries Subsidiaries, on a consolidated basis, for any period of four consecutive Fiscal Quarters (determined as of the last day of the most recent Fiscal Quarter for which financial statements have been delivered pursuant to Section 7.1(b) or Section 7.1(c) (Bor, if prior to the date of the delivery of the first financial statements to be delivered pursuant to Section 7.1(b) or Section 7.1(c), the most recent financial statements referred to in Section 5.6)), the Borrower shall designate sufficient Subsidiaries as “Guarantors” to eliminate such excess, and such designated Subsidiaries shall for all purposes of this Agreement constitute Guarantors and be subject to the provisions of Section 7.8. If at any time the aggregate portion of total assets constituting five percent (5.00%) or more attributable to all Excluded Subsidiaries exceeds 4.0% of the consolidated total assets of the Borrower and its Subsidiaries on a consolidated basisfor any period of four consecutive Fiscal Quarters (determined as of the last day of the most recent Fiscal Quarter for which financial statements have been delivered pursuant to Section 7.1(b) or Section 7.1(c) (or, promptly (andif prior to the date of the delivery of the first financial statements to be delivered pursuant to Section 7.1(b) or Section 7.1(c), in any event, within thirty (30) days after such time (or such longer time as consented the most recent financial statements referred to in writing by Administrative AgentSection 5.6)) Obligors shall cause one or more of such Excluded Subsidiaries to become Subsidiary Guarantors in the manner set forth in Section 8.12(a), the Borrower shall designate sufficient Subsidiaries as “Guarantors” to eliminate such thatexcess, after and such designated Subsidiaries become shall for all purposes of this Agreement constitute Guarantors and be subject to the provisions of Section 7.8. In addition, should an Excluded Subsidiary Guarantors, the non-guarantor Excluded Subsidiaries in the aggregate shall cease to have Revenues or assets, as applicable, that meet the thresholds criteria set forth in clauses (A) and (B) above; providedi), that, no Excluded Subsidiary shall be required to become a Subsidiary Guarantor if doing so would result in material adverse tax consequences for Borrower and its Subsidiaries, taken as a whole. (ii) With respect to each First-Tier Excluded Subsidiary, such Obligor shall grant a security interest and Lien in sixty five percent (65.00%) of each class of voting Equity Interests and 100% of all other Equity Interests in such First-Tier Excluded Subsidiary in favor of the Secured Parties as Collateral for the Obligations, in each case including entering into any necessary local law security documents and delivery of certificated securities issued by such First-Tier Excluded Subsidiary as required by this Agreement or the Security Agreement. Without limiting the generality of the foregoing, in the event that any Obligor shall form or acquire any new Subsidiary that is a First-Tier Excluded Subsidiary, such Obligor will promptly and in any event within thirty (30) days of the formation or acquisition of such Subsidiary (or such longer time as consented to by Administrative Agent in writing) grant a security interest and Lien in sixty five percent (65.00%) of each class of voting Equity Interests and one hundred percent (100.00%) of all other Equity Interests in such First-Tier Excluded Subsidiary in favor of the Secured Parties as Collateral for the Obligations, in each case including entering into any necessary local law security documents and delivery of certificated securities issued by such First-Tier Excluded Subsidiary as required by this Agreement or the Security Agreement. (iii) For of the definition thereof, the Borrower shall designate such Subsidiary as a “Guarantor”, and such Subsidiary shall for all purposes of this Agreement constitute a Guarantor and be subject to the provisions of Section 8.12(b)7.8. If the Reorganization has not been consummated by the Reorganization Outside Date, the determination of whether a “material adverse tax consequence” all Excluded Subsidiaries shall immediately constitute Guarantors and shall be deemed to result from any Foreign Subsidiary becoming a Subsidiary Guarantor shall be made by Administrative Agent in its reasonable discretion, following consultation with Borrower, taking into consideration and weighing, among others, the following relevant factors: (1) the magnitude of an increase in Borrower’s tax liability or a reduction in Borrower’s net operating loss carryforward, taken as a whole; (2) the amount of revenues generated by or assets accumulated at such Foreign Subsidiary compared with those generated by or accumulated at the Obligors; (3) whether the Loans are over- or under-collateralized; (4) the financial performance of Borrower and its Subsidiaries, taken as a whole, and the Obligors’ ability to perform the Obligations (other than Warrant Obligations) at such time; and (5) the cost to Borrower and its Subsidiaries balanced against the practical benefit subject to the Lenders (it being understood that the Administrative Agent shall give heavier weight to the factors set forth in clauses (2) and (3))provisions of Section 7.8.

Excluded Subsidiaries. (i) In the event that, If at any time, time the aggregate portion of net revenue attributable to all Excluded Subsidiaries that are not Obligors have, in the aggregate, (A) total Revenues constituting five percent (5.00%) or more exceeds 2.5% of the total Revenues net revenue of the Borrower and its Subsidiaries Subsidiaries, on a consolidated basis, for any period of four consecutive Fiscal Quarters (determined as of the last day of the most recent Fiscal Quarter for which financial statements have been delivered pursuant to Section 7.1(b) or Section 7.1(c) (Bor, if prior to the date of the delivery of the first financial statements to be delivered pursuant to Section 7.1(b) or Section 7.1(c), the most recent financial statements referred to in Section 5.6)), the Borrower shall designate sufficient Subsidiaries as “Guarantors” to eliminate such excess, and such designated Subsidiaries shall for all purposes of this Agreement constitute Guarantors and be subject to the provisions of Section 7.8. If at any time the aggregate portion of total assets constituting five percent (5.00%) or more attributable to all Excluded Subsidiaries exceeds 2.5% of the consolidated total assets of the Borrower and its Subsidiaries on a consolidated basisfor any period of four consecutive Fiscal Quarters (determined as of the last day of the most recent Fiscal Quarter for which financial statements have been delivered pursuant to Section 7.1(b) or Section 7.1(c) (or, promptly (andif prior to the date of the delivery of the first financial statements to be delivered pursuant to Section 7.1(b) or Section 7.1(c), in any event, within thirty (30) days after such time (or such longer time as consented the most recent financial statements referred to in writing by Administrative AgentSection 5.6)) Obligors shall cause one or more of such Excluded Subsidiaries to become Subsidiary Guarantors in the manner set forth in Section 8.12(a), the Borrower shall designate sufficient Subsidiaries as “Guarantors” to eliminate such thatexcess, after and such designated Subsidiaries become shall for all purposes of this Agreement constitute Guarantors and be subject to the provisions of Section 7.8. In addition, should an Excluded Subsidiary Guarantors, the non-guarantor Excluded Subsidiaries in the aggregate shall cease to have Revenues or assets, as applicable, that meet the thresholds criteria set forth in clauses (A) and (B) above; providedi), that, no Excluded Subsidiary shall be required to become a Subsidiary Guarantor if doing so would result in material adverse tax consequences for Borrower and its Subsidiaries, taken as a whole. (ii) With respect to each First-Tier Excluded Subsidiary, such Obligor shall grant a security interest and Lien in sixty five percent (65.00%) of each class of voting Equity Interests and 100% of all other Equity Interests in such First-Tier Excluded Subsidiary in favor of the Secured Parties as Collateral for the Obligations, in each case including entering into any necessary local law security documents and delivery of certificated securities issued by such First-Tier Excluded Subsidiary as required by this Agreement or the Security Agreement. Without limiting the generality of the foregoing, in the event that any Obligor shall form or acquire any new Subsidiary that is a First-Tier Excluded Subsidiary, such Obligor will promptly and in any event within thirty (30) days of the formation or acquisition of such Subsidiary (or such longer time as consented to by Administrative Agent in writing) grant a security interest and Lien in sixty five percent (65.00%) of each class of voting Equity Interests and one hundred percent (100.00%) of all other Equity Interests in such First-Tier Excluded Subsidiary in favor of the Secured Parties as Collateral for the Obligations, in each case including entering into any necessary local law security documents and delivery of certificated securities issued by such First-Tier Excluded Subsidiary as required by this Agreement or the Security Agreement. (iii) For of the definition thereof, the Borrower shall designate such Subsidiary as a “Guarantor”, and such Subsidiary shall for all purposes of this Section 8.12(b), the determination of whether Agreement constitute a “material adverse tax consequence” shall Guarantor and be deemed to result from any Foreign Subsidiary becoming a Subsidiary Guarantor shall be made by Administrative Agent in its reasonable discretion, following consultation with Borrower, taking into consideration and weighing, among others, the following relevant factors: (1) the magnitude of an increase in Borrower’s tax liability or a reduction in Borrower’s net operating loss carryforward, taken as a whole; (2) the amount of revenues generated by or assets accumulated at such Foreign Subsidiary compared with those generated by or accumulated at the Obligors; (3) whether the Loans are over- or under-collateralized; (4) the financial performance of Borrower and its Subsidiaries, taken as a whole, and the Obligors’ ability to perform the Obligations (other than Warrant Obligations) at such time; and (5) the cost to Borrower and its Subsidiaries balanced against the practical benefit subject to the Lenders (it being understood that the Administrative Agent shall give heavier weight to the factors set forth in clauses (2) and (3))provisions of Section 7.8.

Excluded Subsidiaries. (ia) In the event that, at any time, the aggregate annual cash flow of all Excluded Subsidiaries exceeds $1,000,000.00 as of the end of any fiscal year of Borrower, Borrower shall, by notice to Agent, designate an Excluded Subsidiary (or Excluded Subsidiaries as necessary) that are not Obligors have, in will cease to qualify as an “Excluded Subsidiary” on the aggregate, date Agent receives Borrower’s annual audited financial statements required by Section 7.1(a) and such Subsidiary (Aor Subsidiaries) total Revenues constituting five percent (5.00%shall comply with Section 8.18(c)(i) or more of the total Revenues of Borrower and its Subsidiaries on a consolidated basis, or (Bii) total assets constituting five percent (5.00%) or more of the total assets of Borrower and its Subsidiaries on a consolidated basis, promptly (and, in any event, within thirty (30) days after such time (or such longer time as consented to in writing by Administrative Agent)) Obligors shall cause one or more of such Excluded Subsidiaries to become Subsidiary Guarantors in the manner set forth in Section 8.12(a), such that, after such Subsidiaries become Subsidiary Guarantors, the non-guarantor Excluded Subsidiaries in the aggregate shall cease to have Revenues or assetsbelow, as applicable, so that meet after giving effect thereto, the thresholds set forth aggregate annual cash flow of all remaining Excluded Subsidiaries as of the end of such fiscal year was equal to or less than $1,000,000.00. (a) If an Excluded Subsidiary ceases to qualify as an “Excluded Subsidiary” (whether as a result of clause (a) above or for any other reason), such Subsidiary must comply with Section 8.18(c)(i) or (ii) below, as applicable. The date on which such Excluded Subsidiary ceases to qualify as an Excluded Subsidiary shall be herein referred to as the “Cessation Date”. (i) If such Subsidiary is a Domestic Subsidiary, within ten (10) Business Days after the Cessation Date (unless such ten (10) Business Day time period is extended by Agent in clauses its Amended and Restated Credit Agreement v7 57 sole discretion), such Subsidiary shall (A) execute and deliver to Agent a Joinder to Guaranty Agreement, and (B) abovedeliver to Agent its Organizational Documents and evidence of its authority to enter into such Joinder to Guaranty Agreement (each Joinder to Guaranty Agreement executed by a Domestic Subsidiary pursuant to the preceding clause shall constitute a Loan Document); providedor (i) if such Subsidiary is a Foreign Subsidiary, thatwithin ten (10) Business Days after the Cessation Date (unless such ten (10) Business Day time period is extended by Agent in its sole discretion), no Excluded Borrower or the direct Domestic Subsidiary-owner of such Subsidiary shall be required (A) execute and deliver to become Agent a Subsidiary Guarantor if doing so would result in material adverse tax consequences for Borrower and its Subsidiaries, taken as Pledge Agreement granting Agent a whole. (ii) With respect to each First-Tier Excluded Subsidiary, such Obligor shall grant a security interest and Lien in on sixty five percent (65.0065%) of each class the ownership interests of voting Equity Interests and 100% of all other Equity Interests in such First-Tier Excluded Subsidiary in favor of the Secured Parties as Collateral for the Obligations, in each case including entering into any necessary local law security documents and delivery of certificated securities issued by such First-Tier Excluded Subsidiary as required by this Agreement or the Security Agreement. Without limiting the generality of the foregoing, in the event that any Obligor shall form or acquire any new Subsidiary that is a First-Tier Excluded Foreign Subsidiary, (B) deliver to Agent (I) such Obligor will promptly Foreign Subsidiary’s Organizational Documents and in any event within thirty (30II) days of the formation or acquisition evidence of such Subsidiary pledging party’s authority to enter into such Pledge Agreement, and (or such longer time as consented C) deliver to by Administrative Agent in writing) grant a security interest and Lien in sixty five percent (65.00%) an opinion of each class of voting Equity Interests and one hundred percent (100.00%) of all other Equity Interests in such First-Tier Excluded Subsidiary in favor of the Secured Parties as Collateral for the Obligations, in each case including entering into any necessary local law security documents and delivery of certificated securities issued by such First-Tier Excluded Subsidiary as required by this Agreement or the Security Agreement. (iii) For the purposes of this Section 8.12(b), the determination of whether a “material adverse tax consequence” shall be deemed legal counsel to result from any Foreign Subsidiary becoming a Subsidiary Guarantor shall be made by Administrative Agent in its reasonable discretion, following consultation with Borrower, taking into consideration and weighing, among others, the following relevant factors: (1) the magnitude of an increase in Borrower’s tax liability or a reduction in Borrower’s net operating loss carryforward, taken as a whole; (2) the amount of revenues generated by or assets accumulated at such Foreign Subsidiary compared with those generated opinions covering such matters as may be reasonably requested by or accumulated at the Obligors; (3) whether the Loans are over- or under-collateralized; (4) the financial performance of Borrower and its Subsidiaries, taken as a whole, and the Obligors’ ability to perform the Obligations (other than Warrant Obligations) at such time; and (5) the cost to Borrower and its Subsidiaries balanced against the practical benefit to the Lenders (it being understood that the Administrative Agent shall give heavier weight to the factors set forth in clauses (2) and (3))Agent.

Excluded Subsidiaries. If at any time (a) the aggregate cash or Cash Equivalent Investments attributable to all Excluded Subsidiaries exceeds $8,000,000 in the aggregate at any time from the Closing Date up to and including March 31, 2026 (or such later date as the Administrative Agent may agree in its discretion), and $5,000,000 thereafter, the Borrower shall (i) In within five Business Days after the event thatend of the calendar week in which such excess occurs, at any timedesignate sufficient Subsidiaries as “Guarantors” to eliminate such excess, Excluded and such designated Subsidiaries that are not Obligors haveshall for all purposes of this Agreement constitute Guarantors and be subject to the provisions of Section 7.8, or (ii) within five Business Days after the end of such calendar week in the aggregatewhich such excess occurs, repatriate cash and/or Cash Equivalent Investments in an aggregate amount sufficient to eliminate such excess, (Ab) total Revenues constituting five percent (5.00%) or more the aggregate portion of the total Revenues Revenue attributable to (I) an Excluded Subsidiary exceeds 5.0% of the Revenue of the Borrower and its Subsidiaries on a consolidated basis, or (BII) all Excluded Subsidiaries exceeds 7.5% of the Revenue of the Borrower and its Subsidiaries, as applicable, in each case for any period of four consecutive Fiscal Quarters (determined as of the last day of the most recent Fiscal Quarter for which financial statements have been delivered pursuant to Section 7.1(b) or Section 7.1(c) (or, if prior to the date of the delivery of the first financial statements to be delivered pursuant to Section 7.1(b) or Section 7.1(c), the most recent financial statements referred to in Section 5.6)), within ten Business Days after the end of the fiscal quarter in which such excess occurs, the Borrower shall designate such Excluded Subsidiary or sufficient Subsidiaries as “Guarantors” to eliminate such excess, and such designated Subsidiaries shall for all purposes of this Agreement constitute Guarantors and be subject to the provisions of Section 7.8 or (c) the aggregate portion of total assets constituting five percent attributable to (5.00%I) or more an Excluded Subsidiary exceeds 5.0% of the consolidated total assets of the Borrower and its Subsidiaries on a consolidated basis, promptly or (and, in any event, within thirty (30II) days after such time (or such longer time as consented to in writing by Administrative Agent)) Obligors shall cause one or more of such all Excluded Subsidiaries to become Subsidiary Guarantors in exceeds 7.5% of the manner set forth in Section 8.12(a), such that, after such Subsidiaries become Subsidiary Guarantors, consolidated total assets of the non-guarantor Excluded Subsidiaries in the aggregate shall cease to have Revenues or assetsBorrower and its Subsidiaries, as applicable, that in each case for any period of four consecutive Fiscal Quarters (determined as of the last day of the most recent Fiscal Quarter for which financial statements have been delivered pursuant to Section 7.1(b) or Section 7.1(c) (or, if prior to the date of the delivery of the first financial statements to be delivered pursuant to Section 7.1(b) or Section 7.1(c), the most recent financial statements referred to in Section 5.6)), within ten Business Days after the end of the fiscal quarter in which such excess occurs, the Borrower shall designate such Excluded Subsidiary or sufficient Subsidiaries as “Guarantors” to eliminate such excess, and such designated Subsidiaries shall for all purposes of this Agreement constitute Guarantors and be subject to the provisions of Section 7.8. In addition, should an Excluded Subsidiary cease to meet the thresholds criteria set forth in clauses (A) and (B) above; providedi), that, no Excluded Subsidiary shall be required to become a Subsidiary Guarantor if doing so would result in material adverse tax consequences for Borrower and its Subsidiaries, taken as a whole. (ii) With respect to each First-Tier Excluded Subsidiary, such Obligor shall grant a security interest and Lien in sixty five percent (65.00%) of each class of voting Equity Interests and 100% of all other Equity Interests in such First-Tier Excluded Subsidiary in favor of the Secured Parties as Collateral for the Obligations, in each case including entering into any necessary local law security documents and delivery of certificated securities issued by such First-Tier Excluded Subsidiary as required by this Agreement or the Security Agreement. Without limiting the generality of the foregoing, in the event that any Obligor shall form or acquire any new Subsidiary that is a First-Tier Excluded Subsidiary, such Obligor will promptly and in any event within thirty (30) days of the formation or acquisition of such Subsidiary (or such longer time as consented to by Administrative Agent in writing) grant a security interest and Lien in sixty five percent (65.00%) of each class of voting Equity Interests and one hundred percent (100.00%) of all other Equity Interests in such First-Tier Excluded Subsidiary in favor of the Secured Parties as Collateral for the Obligations, in each case including entering into any necessary local law security documents and delivery of certificated securities issued by such First-Tier Excluded Subsidiary as required by this Agreement or the Security Agreement. (iii) For of the definition thereof, within ten Business Days after the end of the fiscal quarter in which such excess occurs, the Borrower shall designate such Subsidiary as a “Guarantor”, and such Subsidiary shall for all purposes of this Section 8.12(b), the determination of whether Agreement constitute a “material adverse tax consequence” shall Guarantor and be deemed to result from any Foreign Subsidiary becoming a Subsidiary Guarantor shall be made by Administrative Agent in its reasonable discretion, following consultation with Borrower, taking into consideration and weighing, among others, the following relevant factors: (1) the magnitude of an increase in Borrower’s tax liability or a reduction in Borrower’s net operating loss carryforward, taken as a whole; (2) the amount of revenues generated by or assets accumulated at such Foreign Subsidiary compared with those generated by or accumulated at the Obligors; (3) whether the Loans are over- or under-collateralized; (4) the financial performance of Borrower and its Subsidiaries, taken as a whole, and the Obligors’ ability to perform the Obligations (other than Warrant Obligations) at such time; and (5) the cost to Borrower and its Subsidiaries balanced against the practical benefit subject to the Lenders (it being understood that the Administrative Agent shall give heavier weight to the factors set forth in clauses (2) and (3))provisions of Section 7.8.

Excluded Subsidiaries. (ia) In the event thatthe aggregate annual cash flow of all Excluded Subsidiaries (other than the Trust Subsidiary) exceeds $1,000,000.002,000,000.00 as of the end of any fiscal year of Borrower, Borrower shall, by notice to Agent, designate an Excluded Subsidiary (or Excluded Subsidiaries as necessary and, in each case, other than the Trust Subsidiary) that will cease to qualify as an “Excluded Subsidiary” on the date Agent receives Borrower’s annual audited financial statements required by Section 7.1(a) and such Subsidiary (or Subsidiaries) shall comply with Section 8.18(c)(i) or (ii) below, as applicable, so that after giving effect thereto, the aggregate annual cash flow of all remaining Excluded Subsidiaries (other than the Trust Subsidiary) as of the end of such fiscal year was equal to or less than $1,000,000.002,000,000.00 . (b) If an Excluded Subsidiary ceases to qualify as an “Excluded Subsidiary” (whether as a result of clause (a) above or for any other reason), such Subsidiary must comply with Section 8.18(c)(i) or (ii) below, as applicable. The date on which such Excluded Subsidiary ceases to qualify as an Excluded Subsidiary shall be herein referred to as the “Cessation Date”. (i) If such Subsidiary is a Domestic Subsidiary, within ten (10) Business Days after the Cessation Date (unless such ten (10) Business Day time period is extended by Agent in its sole discretion), such Subsidiary shall (A) execute and deliver to Agent a Joinder to Guaranty Agreement, and (B) deliver to Agent its Organizational Documents and evidence of its authority to enter into such Joinder to Guaranty Agreement (each Joinder to Guaranty Agreement executed by a Domestic Subsidiary pursuant to the preceding clause shall constitute a Loan Document); or (ii) if such Subsidiary is a Foreign Subsidiary, within ten (10) Business Days after the Cessation Date (unless such ten (10) Business Day time period is extended by Agent in its sole discretion), Borrower or the direct Domestic Subsidiary-owner of such Subsidiary shall (A) execute and deliver to Agent a Pledge Agreement granting Agent a Lien on sixty five percent (65%) of the ownership interests of such Foreign Subsidiary, (B) deliver to Agent (I) such Foreign Subsidiary’s Organizational Documents and (II) evidence of such pledging party’s authority to enter into such Pledge Agreement, and (C) deliver to Agent an opinion of legal counsel to such Foreign Subsidiary opinions covering such matters as may be reasonably requested by Agent. (d) Trust Subsidiary shall not, at any time, Excluded Subsidiaries that hold or own any Proprietary Accounts. The only assets Trust Subsidiary will hold and own are not Obligors have, in the aggregate, (Ai) total Revenues constituting five percent (5.00%) or more of the total Revenues depository accounts which are used to hold client-related payroll and payroll tax funds of Borrower and its Subsidiaries on a consolidated basis, or and (Bii) total assets constituting five percent (5.00%) or more of the total assets of Borrower and its Subsidiaries on a consolidated basis, promptly (and, received in any event, within thirty (30) days after such time (or such longer time as consented connection with an investment permitted pursuant to in writing by Administrative Agent)) Obligors shall cause one or more of such Excluded Subsidiaries to become Subsidiary Guarantors in the manner set forth in Section 8.12(a), such that, after such Subsidiaries become Subsidiary Guarantors, the non-guarantor Excluded Subsidiaries in the aggregate shall cease to have Revenues or assets, as applicable, that meet the thresholds set forth in clauses (A8.7(l) and (B) above; provided, that, no Excluded Subsidiary shall be required to become a Subsidiary Guarantor if doing so would result in material adverse tax consequences for Borrower and its Subsidiaries, taken as a whole. (ii) With respect to each First-Tier Excluded Subsidiary, such Obligor shall grant a security interest and Lien in sixty five percent (65.00%) of each class of voting Equity Interests and 100% of all other Equity Interests in such First-Tier Excluded Subsidiary in favor of the Secured Parties as Collateral for the Obligations, in each case including entering into any necessary local law security documents and delivery of certificated securities issued by such First-Tier Excluded Subsidiary as required by this Agreement or the Security Agreement. Without limiting the generality of the foregoing, in the event that any Obligor shall form or acquire any new Subsidiary that is a First-Tier Excluded Subsidiary, such Obligor will promptly and in any event within thirty (30) days of the formation or acquisition of such Subsidiary (or such longer time as consented to by Administrative Agent in writing) grant a security interest and Lien in sixty five percent (65.00%) of each class of voting Equity Interests and one hundred percent (100.00%) of all other Equity Interests in such First-Tier Excluded Subsidiary in favor of the Secured Parties as Collateral for the Obligations, in each case including entering into any necessary local law security documents and delivery of certificated securities issued by such First-Tier Excluded Subsidiary as required by this Agreement or the Security Agreement. (iii) For the purposes of this Section 8.12(b), the determination of whether a “material adverse tax consequence” shall be deemed to result from any Foreign Subsidiary becoming a Subsidiary Guarantor shall be made by Administrative Agent in its reasonable discretion, following consultation with Borrower, taking into consideration and weighing, among others, the following relevant factors: (1) the magnitude of an increase in Borrower’s tax liability or a reduction in Borrower’s net operating loss carryforward, taken as a whole; (2) the amount of revenues generated by or assets accumulated at such Foreign Subsidiary compared with those generated by or accumulated at the Obligors; (3) whether the Loans are over- or under-collateralized; (4) the financial performance of Borrower and its Subsidiaries, taken as a whole, and the Obligors’ ability to perform the Obligations (other than Warrant Obligations) at such time; and (5) the cost to Borrower and its Subsidiaries balanced against the practical benefit to the Lenders (it being understood that the Administrative Agent shall give heavier weight to the factors set forth in clauses (2) and (3)m).