Incurrence of Indebtedness and Issuance of Preferred Stock. The Company shall not, and shall not permit any of its Subsidiaries to, directly or indirectly, create, incur, issue, assume, guaranty or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") any Indebtedness (including Acquired Debt); provided, however, that, so long as no Default or Event of Default has occurred and is continuing, the Company and its Restricted Subsidiaries may incur Indebtedness (including Acquired Debt) if the Fixed Charge Coverage Ratio for the Company's most recently ended four full fiscal quarters for which financial statements are available immediately preceding the date on which such additional Indebtedness is incurred would have been at least 2.0 to 1, determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the additional Indebtedness had been incurred at the beginning of such four-quarter period. The foregoing provisions will not apply to: (i) the incurrence by the Company and its Restricted Subsidiaries of Indebtedness pursuant to the Bank Credit Facility in an aggregate principal amount not to exceed $50.0 million at any one time outstanding less any Net Proceeds of Asset Sales applied to permanently reduce the Bank Credit Facility pursuant to the provisions described in Section 4.10; (ii) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness; (iii) the incurrence by the Company and its Restricted Subsidiaries of Indebtedness represented by the Senior Subordinated Notes and the Guarantees thereof by any Restricted Subsidiaries pursuant to the provisions in Section 12.01 hereof; (iv) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of the Company or such Restricted Subsidiary, in an aggregate principal amount not to exceed $5.0 million at any time outstanding; (v) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness in connection with the acquisition of assets or a new Restricted Subsidiary; provided that such Indebtedness was incurred by the prior owner of such assets or such Restricted Subsidiary prior to such acquisition by the Company or one of its Restricted Subsidiaries and was not incurred in connection with, or in contemplation of, such acquisition by the Company or one of it Restricted Subsidiaries; and provided further that the principal amount (or accreted value, as applicable) of such Indebtedness, together with any other outstanding Indebtedness incurred pursuant to this clause (v), does not exceed $5.0 million; (vi) the incurrence of intercompany Indebtedness between or among the Company and any of its Wholly Owned Restricted Subsidiaries; provided, that any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Wholly Owned Restricted Subsidiary of the Company or any sale or other transfer of any such Indebtedness to a Person that is neither the Company, or a Wholly Owned Restricted Subsidiary of the Company, shall be deemed to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be; (vii) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Debt in exchange for, or the net proceeds of which are used to extend, refinance, renew, replace, defease or refund Indebtedness that was permitted by this Indenture to be incurred; (viii) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt; provided, that if, and to the extent any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company. (ix) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk with respect to any floating rate indebtedness that is permitted by the terms of this Indenture to be outstanding; and (x) the incurrence by the Company and its Restricted Subsidiaries of additional Indebtedness in an aggregate amount not to exceed $7.5 million at any time outstanding.
Appears in 1 contract
Sources: Indenture (Fonda Group Inc)
Incurrence of Indebtedness and Issuance of Preferred Stock. The Company shall not, and shall not permit any of its Subsidiaries to, directly or indirectly, create, incur, issue, assume, guaranty or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") any Indebtedness (including Acquired Debt)) and that the Company shall not issue any Disqualified Stock and shall not permit any of its Subsidiaries to issue any shares of preferred stock; provided, however, that, so long as no Default or Event of Default has occurred and is continuing, that the Company and its Restricted Subsidiaries may incur Indebtedness (including Acquired Debt) or issue shares of Disqualified Stock if the Fixed Charge Coverage Ratio for the Company's most recently ended four full fiscal quarters for which internal financial statements are available immediately preceding the date on which such additional Indebtedness is incurred or such Disqualified Stock is issued would have been at least 2.5 to 1, determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the additional Indebtedness had been incurred, or the Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period. The foregoing provisions shall not apply to:
(i) the incurrence by the Company of term Indebtedness under the New Credit Agreement or any one or more successor or additional bank facilities and/or Attributable Debt in respect of sale and leaseback transactions the net proceeds of which were applied to repay any such term Indebtedness in an aggregate principal amount at any time outstanding not to exceed an amount equal to $170.0 million less the aggregate amount of all repayments, optional or mandatory, of the principal of any such term Indebtedness (other than repayments that are immediately reborrowed and other than repayments made with the proceeds of sale and leaseback transactions pursuant to this clause (i)) that have been made since the Issue Date;
(a) the incurrence by the Company of revolving Indebtedness under the New Credit Agreement (or any one or more successor or additional bank facilities) and letters of credit (with letters of credit being deemed to have a principal amount equal to the maximum potential liability of the Company thereunder) and (b) the incurrence by the Receivables Subsidiary of Non-Recourse Debt under the Receivables Facility; provided, however, that, the aggregate principal amount at any time outstanding pursuant to subclauses (a) and (b) of this clause (ii) (excluding intercompany Indebtedness of the Receivables Subsidiary permitted by clause (viii) below) shall not exceed an amount equal to $155.0 million less the aggregate amount of all Net Proceeds of Asset Sales applied to permanently reduce the commitments with respect to such revolving Indebtedness pursuant to the provisions of Section 4.10 hereof;
(iii) the incurrence by the Company and its Subsidiaries of the Existing Indebtedness;
(iv) the incurrence by the Company of Indebtedness represented by the Senior Notes and the Notes;
(v) the incurrence by the Company of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case, incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of the Company, in an aggregate principal amount not to exceed $25.0 million at any time outstanding;
(vi) the incurrence by any of the Company's Subsidiaries of Indebtedness in connection with the acquisition of assets or a new Subsidiary; provided that (1) such Indebtedness was incurred by the prior owner of such assets or such Subsidiary prior to such acquisition and was not incurred in connection with, or in contemplation of, such acquisition or is in the nature of an earnout payment or holdback payment incurred by one of the Company's Subsidiaries in connection with the acquisition of assets or a new Subsidiary, (2) the principal amount (or accreted value, as applicable) of such Indebtedness, together with any other outstanding Indebtedness incurred pursuant to this clause (vi), does not exceed $10.0 million and (3) the Fixed Charge Coverage Ratio for the Company's most recently ended four full fiscal quarters for which internal financial statements are available immediately preceding the date on which such additional Indebtedness is incurred would have been at least 2.0 2.5 to 1, determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the additional Indebtedness had been incurred at the beginning of such four-quarter period. The foregoing provisions will not apply to:
(i) the incurrence by the Company and its Restricted Subsidiaries of Indebtedness pursuant to the Bank Credit Facility in an aggregate principal amount not to exceed $50.0 million at any one time outstanding less any Net Proceeds of Asset Sales applied to permanently reduce the Bank Credit Facility pursuant to the provisions described in Section 4.10;
(ii) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;
(iii) the incurrence by the Company and its Restricted Subsidiaries of Indebtedness represented by the Senior Subordinated Notes and the Guarantees thereof by any Restricted Subsidiaries pursuant to the provisions in Section 12.01 hereof;
(iv) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of the Company or such Restricted Subsidiary, in an aggregate principal amount not to exceed $5.0 million at any time outstanding;
(v) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness in connection with the acquisition of assets or a new Restricted Subsidiary; provided that such Indebtedness was incurred by the prior owner of such assets or such Restricted Subsidiary prior to such acquisition by the Company or one of its Restricted Subsidiaries and was not incurred in connection with, or in contemplation of, such acquisition by the Company or one of it Restricted Subsidiaries; and provided further that the principal amount (or accreted value, as applicable) of such Indebtedness, together with any other outstanding Indebtedness incurred pursuant to this clause (v), does not exceed $5.0 million;
(vi) the incurrence of intercompany Indebtedness between or among the Company and any of its Wholly Owned Restricted Subsidiaries; provided, that any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Wholly Owned Restricted Subsidiary of the Company or any sale or other transfer of any such Indebtedness to a Person that is neither the Company, or a Wholly Owned Restricted Subsidiary of the Company, shall be deemed to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be;
(vii) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Debt in exchange for, or the net proceeds of which are used to extend, refinance, renew, replace, defease or refund refund, Indebtedness that was permitted by this Indenture to be incurred;
(viii) the incurrence by the Company's Unrestricted Company or any of its Subsidiaries of Non-Recourse Debtintercompany Indebtedness between or among the Company and any of its Subsidiaries, and any intercompany Indebtedness arising in connection with a Receivables Facility; provided, however, that if(1) if the Company is the obligor on such Indebtedness, and such Indebtedness is expressly subordinate to the extent payment in full of all Obligations with respect to the Notes and (2)(A) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness ceases being held by a Person other than the Company or a Subsidiary and (B) any sale or other transfer of any such Indebtedness to be Non-Recourse Debt of an Unrestricted Subsidiary, such event a Person that is not either the Company or a Subsidiary thereof shall be deemed deemed, in each case, to constitute an incurrence of such Indebtedness by a Restricted Subsidiary of the Company.Company or such Subsidiary, as the case may be;
(ix) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk with respect to any floating rate indebtedness Indebtedness that is permitted by the terms of this Indenture to be outstandingoutstanding or for the purpose of hedging against currency exchange rate fluctuations;
(x) Guarantees by the Company and its Subsidiaries of Indebtedness of Subsidiaries, and Guarantees by Subsidiaries of Indebtedness of the Company, which Indebtedness is, in each case, permitted to be incurred under this covenant other than Indebtedness permitted to be incurred pursuant to subclause (b) of clause (ii) above; and
(xxi) the incurrence by the Company and or any of its Restricted Subsidiaries of additional Indebtedness (in addition to Indebtedness permitted by any other clause of this paragraph) in an aggregate principal amount (or accreted value, as applicable) at any time outstanding not to exceed $7.5 million at any time outstanding25.0 million.
Appears in 1 contract
Sources: Indenture (Printpack Inc)
Incurrence of Indebtedness and Issuance of Preferred Stock. The Company shall not, and shall not permit any of its Subsidiaries to, directly or indirectly, create, incur, issue, assume, guaranty guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") any Indebtedness (including Acquired Debt)Indebtedness) and the Company shall not issue any Disqualified Stock and shall not permit any of its Subsidiaries to issue any shares of preferred stock; provided, however, that, so long as no Default or Event of Default has occurred and is continuing, that the Company and its Restricted Subsidiaries may incur Indebtedness (including Acquired DebtIndebtedness) if or issue shares of Disqualified Stock and the Company's Subsidiaries that are Subsidiary Guarantors may incur Indebtedness if: (i) the Fixed Charge Coverage Ratio for the Company's most recently ended four full fiscal quarters for which internal financial statements are available immediately preceding the date on which such additional Indebtedness is incurred or such Disqualified Stock is issued would have been at least 2.0 to 1, determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the additional Indebtedness had been incurred incurred, or the Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period; and (ii) no Default or Event of Default shall have occurred and be continuing or would occur as a consequence thereof; provided, that no Guarantee may be incurred pursuant to this paragraph unless the guaranteed Indebtedness is incurred by the Company or a Subsidiary Guarantor pursuant to this paragraph. The foregoing provisions will shall not apply to:
(i) the incurrence by the Company or a Subsidiary Guarantor of New Senior Debt (and its Restricted Guarantees thereof by Subsidiaries of Indebtedness pursuant to that are Subsidiary Guarantors and by the Bank Credit Facility Company, if applicable) in an aggregate principal amount at any time outstanding (with letters of credit obligations being deemed to have a principal amount equal to the maximum potential liability of the Company and its Subsidiaries that are Subsidiary Guarantors with respect thereto) not to exceed an amount equal to $50.0 million at any one time outstanding less any Net Proceeds of Asset Sales applied to permanently reduce the Bank Credit Facility pursuant to the provisions described in Section 4.1045,000,000;
(ii) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;
(iii) the incurrence by the Company and its Restricted Subsidiaries of Indebtedness represented by the Senior Subordinated Notes and by the Guarantees thereof Subsidiary Guarantors of Indebtedness represented by any Restricted Subsidiaries pursuant to the provisions in Section 12.01 hereofSubsidiary Guarantees;
(iv) the incurrence by the Company or any of its Restricted Subsidiaries Subsidiary Guarantor of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligationsPurchase Money Obligations, in each case incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment property used in the business of the Company or such Restricted SubsidiarySubsidiary Guarantor, in an aggregate principal amount not to exceed $5.0 million 10,000,000 at any time outstanding;
(v) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness in connection with the acquisition of assets or a new Restricted Subsidiary; provided that such Indebtedness was incurred by the prior owner of such assets or such Restricted Subsidiary prior to such acquisition by the Company or one of its Restricted Subsidiaries and was not incurred in connection with, or in contemplation of, such acquisition by the Company or one of it Restricted Subsidiaries; and provided further that the principal amount (or accreted value, as applicable) of such Indebtedness, together with any other outstanding Indebtedness incurred pursuant to this clause (v), does not exceed $5.0 million;
(vi) the incurrence of intercompany Indebtedness between or among the Company and any of its Wholly Owned Restricted Subsidiaries; provided, that any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Wholly Owned Restricted Subsidiary of the Company or any sale or other transfer of any such Indebtedness to a Person that is neither the Company, or a Wholly Owned Restricted Subsidiary of the Company, shall be deemed to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be;
(vii) the incurrence by the Company or any of its Restricted Subsidiaries Guarantor of Permitted Refinancing Debt Indebtedness in exchange for, or the net proceeds of which are used to extend, refinance, renew, replace, defease or refund refund, Indebtedness that was permitted by incurred under the first paragraph of this Indenture to be incurredSection 4.10;
(viii) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt; provided, that if, and to the extent any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company.
(ixvi) the incurrence by the Company or any of its Restricted Wholly Owned Subsidiaries of intercompany Indebtedness between or among the Company and any of its Wholly Owned Subsidiaries or between or among any Wholly Owned Subsidiaries; provided, however, that (i) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than a Wholly Owned Subsidiary and (ii) any sale or other transfer of any such Indebtedness to a Person that is not either the Company or a Wholly Owned Subsidiary shall be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Subsidiary, as the case may be;
(vii) the incurrence by the Company or any of its Subsidiaries that are Subsidiary Guarantors of Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk with respect to any floating rate indebtedness Indebtedness that is permitted by this Indenture to be incurred; and
(viii) the incurrence by the Company or any of its Subsidiaries that are Subsidiary Guarantors of Indebtedness (in addition to Indebtedness permitted by any other clause of this paragraph) in an aggregate principal amount at any time outstanding not to exceed the sum of $2,500,000; Notwithstanding any other provision of this covenant, a Guarantee of Indebtedness permitted by the terms of this Indenture to be outstanding; and
(x) at the time such Indebtedness was incurred shall not constitute a separate incurrence by the Company and its Restricted Subsidiaries of additional Indebtedness in an aggregate amount not to exceed $7.5 million at any time outstandingIndebtedness.
Appears in 1 contract
Sources: Indenture (RBX Corp)
Incurrence of Indebtedness and Issuance of Preferred Stock. The Company shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guaranty guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") any Indebtedness (including Acquired Debt), and the Company shall not issue any Disqualified Stock and shall not permit any of its Restricted Subsidiaries to issue any shares of preferred stock; provided, however, that, so long as no Default or Event of Default has occurred and is continuing, that the Company and its Restricted Subsidiaries may incur Indebtedness (including Acquired Debt) and issue Disqualified Stock and any Restricted Subsidiary may incur Acquired Debt, if either:
(i) the Fixed Charge Coverage Consolidated Leverage Ratio for at the end of the Company's most recently ended four full fiscal quarters quarter (the "Reference Period") for which financial statements are a consolidated balance sheet of the Company is available immediately preceding the date on which such additional Indebtedness is incurred or such Disqualified Stock is issued would have been at least 2.0 less than 5.0 to 11.0, determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the additional Indebtedness had been incurred incurred, or the Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period. The foregoing provisions will not apply to:
(i) the incurrence by the Company and its Restricted Subsidiaries of Indebtedness pursuant to the Bank Credit Facility in an aggregate principal amount not to exceed $50.0 million at any one time outstanding less any Net Proceeds of Asset Sales applied to permanently reduce the Bank Credit Facility pursuant to the provisions described in Section 4.10;Reference Period; or
(ii) the incurrence by Consolidated Capital Ratio at the Company and its Restricted Subsidiaries end of the Existing Indebtedness;Reference Period would have been less than 2.0 to 1.0, determined after giving effect to the incurrence or issuance of such Indebtedness or Disqualified Stock and, to the extent set forth in the definitions used herein, on a pro forma basis (including, to the extent set forth in the definitions used herein, a pro forma application of the net proceeds therefrom). The first paragraph of this Section 4.09 shall not prohibit the incurrence of any of the following items of Indebtedness (collectively, "Permitted Debt"):
(iii) the incurrence by the Company and its Restricted Subsidiaries of Indebtedness represented by the Senior Subordinated Notes and the Guarantees thereof by any Restricted Subsidiaries pursuant to the provisions in Section 12.01 hereof;
(iva) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings under Credit Facilities or purchase money obligations, in each case incurred for Permitted Vendor Facilities; provided that the purpose aggregate principal amount of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business Indebtedness of the Company and its Restricted Subsidiaries outstanding under all Credit Facilities or Permitted Vendor Facilities after giving effect to such Restricted Subsidiary, in an aggregate incurrence (with letters of credit being deemed to have a principal amount equal to the maximum potential liability of the Company thereunder) does not exceed an amount equal to exceed $5.0 725.0 million at less the aggregate amount of all Net Proceeds of Asset Sales applied by the Company or any time outstandingof its Restricted Subsidiaries since the Issue Date to permanently repay Indebtedness under a Credit Facility pursuant to Section 4.10 hereof;
(vb) the incurrence by the Company and its Restricted Subsidiaries of Existing Indebtedness;
(c) the incurrence by the Company of Indebtedness represented by the Notes, the Euro Notes, the Exchange Notes and the Euro Exchange Notes;
(d) the incurrence by the Company or any of its Restricted Subsidiaries of Purchase Money Indebtedness and Vendor Financing Indebtedness provided (A) that the amount thereof does not exceed 100% of the Company's and its Restricted Subsidiaries' aggregate cost (determined in connection accordance with GAAP in good faith by the acquisition Board of assets Directors) of the construction, acquisition, development, engineering, installation and improvement of the applicable Telecommunications Assets and (B) in the case of the incurrence of either Purchase Money Indebtedness or Vendor Financing Indebtedness by a new Restricted Subsidiary; provided that , such Indebtedness was incurred by shall be Qualified Subsidiary Indebtedness;
(e) the prior owner of such assets or such Restricted Subsidiary prior to such acquisition incurrence by the Company or one any of its Restricted Subsidiaries and was not incurred of Permitted Refinancing Indebtedness in connection withexchange for, or in contemplation ofthe net proceeds of which are used to refund, such acquisition refinance or replace, Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture to be incurred under the first paragraph of this Section or clauses (b), (c), (d), (l), (n), (o) or (p) of this paragraph;
(f) the incurrence by the Company or one any of it its Restricted Subsidiaries; and provided further that the principal amount (or accreted value, as applicable) of such Indebtedness, together with any other outstanding Indebtedness incurred pursuant to this clause (v), does not exceed $5.0 million;
(vi) the incurrence Subsidiaries of intercompany Indebtedness between or among the Company and any of its Wholly Owned Restricted SubsidiariesSubsidiaries and the issuance of preferred stock by a Restricted Subsidiary to the Company or another Restricted Subsidiary of the Company; provided, that however, that:
(i) if the Company is the obligor on such Indebtedness, such Indebtedness must be expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes; and
(ii) (A) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness or preferred stock being held by a Person other than the Company or a Wholly Owned Restricted Subsidiary of the Company or thereof and (B) any sale or other transfer of any such Indebtedness or preferred stock to a Person that is neither not either the Company, Company or a Wholly Owned Restricted Subsidiary of the Company, thereof; shall be deemed deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be, that was not permitted by this clause (f);
(vii) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Debt in exchange for, or the net proceeds of which are used to extend, refinance, renew, replace, defease or refund Indebtedness that was permitted by this Indenture to be incurred;
(viii) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt; provided, that if, and to the extent any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company.
(ixg) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing or hedging interest or foreign currency exchange rate risk with respect to any floating rate indebtedness Indebtedness or foreign currency based Indebtedness, respectively, that is permitted by the terms of this Indenture to be outstanding; andprovided that the notional amount of any such Hedging Obligation does not exceed the amount of Indebtedness or other liability to which such Hedging Obligation relates; and provided further that such Hedging Obligations are not incurred for speculative purposes;
(xh) the incurrence guarantee by the Company and or any of its Restricted Subsidiaries of Indebtedness of the Company or any Restricted Subsidiary of the Company that was permitted to be incurred by another provision of this covenant;
(i) the accrual of interest, accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, and the payment of dividends on Disqualified Stock in an aggregate the form of additional shares of the same class of Disqualified Stock; provided, in each such case, that the amount not to exceed $7.5 million at any time outstanding.thereof is included in Fixed Charges of the Company as accrued;
Appears in 1 contract
Sources: Indenture (360networks Inc)
Incurrence of Indebtedness and Issuance of Preferred Stock. The Company shall not, and shall not permit any of its Subsidiaries to, directly or indirectly, create, incur, issue, assume, guaranty guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") any Indebtedness (including Acquired Debt)) and that the Company shall not issue any Disqualified Stock and shall not permit any of its Restricted Subsidiaries to issue any shares of preferred stock; provided, however, that, so long as no Default or Event of Default has occurred and is continuing, that the Company and its Restricted Subsidiaries may incur Indebtedness (including Acquired Debt) or issue shares of Disqualified Stock if the Company's Fixed Charge Coverage Ratio for the Company's most recently ended four full fiscal quarters for which internal financial statements are available immediately preceding the date on which such additional Indebtedness is incurred or such Disqualified Stock is issued would have been at least 2.0 2.00 to 11.00, determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the additional Indebtedness had been incurred incurred, or the Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period. The foregoing provisions will of the first paragraph of this Section 4.9 shall not apply to:
to the incurrence of any of the following items of Indebtedness (collectively, "Permitted Debt") so long as no Default has occurred and is continuing or would be caused thereby: the incurrence by the Company of (A) revolving credit Indebtedness under any Credit Facility, letters of credit (with letters of credit being deemed to have a principal amount equal to the maximum potential liability of the Company and its Restricted Subsidiaries thereunder) and related Guarantees under any Credit Facility; provided that the aggregate principal amount of all revolving Indebtedness and letters of credit of the Company and its Restricted Subsidiaries (with letters of credit being deemed to have a principal amount equal to the maximum potential liability of the Company and its Restricted Subsidiaries thereunder) outstanding at any one time under all such Credit Facilities after giving effect to such incurrence, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any other Indebtedness incurred pursuant to this clause (i), does not exceed $160.0 million less the aggregate amount of Asset Sale proceeds applied by the Company and its Restricted Subsidiaries to permanently reduce the availability of revolving credit Indebtedness under the Credit Facility pursuant to the provisions described in Section 4.10 hereof; and (B) up to $75.0 million of the term loan or a similar facility not to exceed $75.0 million (less the aggregate amount of all repayments (optional or mandatory) of the principal of any term loan pursuant to this clause (i) that has been made by the Company since the date of this Indenture); the incurrence by the Company and its Restricted Subsidiaries of Existing Indebtedness; the incurrence by the Company of Indebtedness pursuant to represented by the Bank Credit Facility Notes in an aggregate principal amount not of up to exceed $50.0 150.0 million at any one time outstanding less any Net Proceeds on the date of Asset Sales applied to permanently reduce the Bank Credit Facility pursuant to the provisions described in Section 4.10;
(ii) this Indenture and the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;
(iii) the incurrence by the Company and its Restricted Subsidiaries Guarantors of Indebtedness represented by the Senior Subordinated Notes and the Subsidiary Guarantees thereof by any Restricted Subsidiaries pursuant to the provisions in Section 12.01 hereof;
(iv) thereof; the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of the Company or such Restricted Subsidiary, in an aggregate principal amount amount, including all Permitted Refinancing Indebtedness incurred pursuant to this clause (iv), not to exceed $5.0 15.0 million at any time outstanding;
(v) ; the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in connection with the acquisition respect of assets or a new Restricted Subsidiary; provided Indebtedness that such Indebtedness was permitted by this Indenture to be incurred by such entity other than pursuant to clause (i), (vi) and (vii) below; the prior owner of such assets or such Restricted Subsidiary prior to such acquisition incurrence by the Company or one any of its Restricted Subsidiaries and was not incurred in connection with, or in contemplation of, such acquisition by the Company or one of it Restricted Subsidiaries; and provided further that the principal amount (or accreted value, as applicable) of such Indebtedness, together with any other outstanding Indebtedness incurred pursuant to this clause (v), does not exceed $5.0 million;
(vi) the incurrence of intercompany Indebtedness between or among the Company and any of its Wholly Owned Restricted Subsidiaries; provided, however, that (i) if the Company is the obligor on such Indebtedness, such Indebtedness is expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes and this Indenture and (ii)(A) any subsequent event or issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Wholly Owned Restricted Subsidiary of the Company or and (B) any sale or other transfer of any such Indebtedness to a Person that is neither not either the Company, Company or a Wholly Owned Restricted Subsidiary of the Company, Company shall be deemed deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be;
, that was not permitted by this clause (vii) vi); the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Debt Hedging Obligations that are incurred in exchange forthe normal course of business and consistent with past business practices for the purpose of fixing or hedging currency, commodity or the net proceeds of which are used interest rate risk (including with respect to extend, refinance, renew, replace, defease or refund any floating rate Indebtedness that was is permitted by the terms of this Indenture to be incurred;
outstanding in connection with the conduct of their respective businesses and not for speculative purposes); the Guarantee by the Company of Indebtedness of any of the Guarantors or the Guarantee by any of the Guarantors of Indebtedness of the Company, in each case that was permitted to be incurred by another provision of this Section 4.9; the incurrence by a Restricted Subsidiary that is a Foreign Subsidiary of Non-Recourse Debt in an amount not to exceed the sum of (viiia) 75% of the net book value of the non-Affiliate accounts receivable of such Restricted Foreign Subsidiary determined in accordance with GAAP and (b) 50% of the total Eligible Inventory of such Restricted Subsidiary; the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt; , provided, however, that if, and to the extent if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company.
Company that was not permitted by this clause (ix) x); the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are Indebtedness arising from agreements of the Company or a Restricted Subsidiary of the Company providing for indemnification, adjustment of purchase price or other similar obligations, in each case, incurred or assumed in connection with the disposition of any business, assets or a Restricted Subsidiary of the Company, other than the Guarantees of Indebtedness incurred by any Person acquiring all or any portion of such business, assets or a Restricted Subsidiary for the purpose of fixing financing such acquisition; provided that (A) such Indebtedness is not reflected on the balance sheet of the Company or hedging interest rate risk any Subsidiary of the Company (contingent -47- 55 obligations referred to in a footnote to financial statements and not otherwise reflected on the balance sheet will not be deemed to be reflected on such balance sheet for purposes of this clause (A)) and (B) the maximum assumable liability in respect of all such Indebtedness with respect to such disposition shall at no time exceed the gross proceeds including noncash proceeds (the fair market value of such noncash proceeds being measured at the time received and without giving effect to any floating rate indebtedness that is permitted by the terms of this Indenture to be outstanding; and
(xsubsequent changes in value) the incurrence actually received by the Company and its Restricted Subsidiaries in connection with such disposition; and the incurrence by the Company or any of its Restricted Subsidiaries that are Guarantors of additional Indebtedness in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any other Indebtedness incurred pursuant to this clause (xii), not to exceed $7.5 25.0 million, provided that up to $10.0 million at of such $25.0 million may be incurred by any time outstandingof the Company's Foreign Restricted Subsidiaries that are not Guarantors. For purposes of determining compliance with this covenant, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (i) through (xii) above as of the date of incurrence thereof or is entitled to be incurred pursuant to the first paragraph of this covenant as of the date of incurrence thereof, the Company shall, in its sole discretion, classify such item of Indebtedness as of the date of incurrence thereof in any manner that complies with this covenant and such item of Indebtedness shall be treated as having been incurred pursuant to only one of such clauses or pursuant to the first paragraph hereof. Accrual of interest, the accretion of accreted value and the payment of interest in the form of additional Indebtedness will not be deemed to be an incurrence of Indebtedness for purposes of this covenant.
Appears in 1 contract
Sources: Indenture (Salton Inc)
Incurrence of Indebtedness and Issuance of Preferred Stock. The Company shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guaranty guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incurINCUR") any Indebtedness (including Acquired Debt); provided, however, that, so long as no Default or Event of Default has occurred ) and is continuing, that the Company shall not issue any Disqualified Stock and shall not permit any of its Restricted Subsidiaries to issue any shares of preferred stock; PROVIDED, HOWEVER, that the Company may incur Indebtedness (including Acquired Debt) or issue shares of Disqualified Stock and any of the Company's Restricted Subsidiaries may incur Indebtedness if the Company's Fixed Charge Coverage Ratio for the Company's most recently ended four full fiscal quarters for which internal financial statements are available immediately preceding the date on which such additional Indebtedness is incurred or such Disqualified Stock is issued would have been at least 2.0 2.00 to 1, determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the additional Indebtedness had been incurred incurred, or the Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period. The foregoing provisions will of the first paragraph of this Section 4.09 shall not apply to:to the incurrence of any of the following items of Indebtedness (collectively, "PERMITTED DEBT"):
(i) the incurrence by the Company or its Restricted Subsidiaries of term Indebtedness under the Credit Facility, letters of credit (with letters of credit being deemed to have a principal amount equal to the maximum potential liability of the Company and its Restricted Subsidiaries of Indebtedness pursuant to thereunder) and related Guarantees under the Bank Credit Facility in an Facility; PROVIDED that the aggregate principal amount of all term Indebtedness and letters of credit of the Company and its Restricted Subsidiaries (with letters of credit being deemed to have a principal amount equal to the maximum potential liability of the Company and its Restricted Subsidiaries thereunder) outstanding under the Credit Facility after giving effect to such incurrence, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any other Indebtedness incurred pursuant to this clause (i) does not exceed an amount equal to $550.0 million;
(ii) the incurrence by the Company or its Restricted Subsidiaries of revolving credit Indebtedness under the Credit Facility, letters of credit (with letters of credit being deemed to have a principal amount equal to the maximum potential liability of the Company and its Restricted Subsidiaries thereunder) and related Guarantees under the Credit Facility; PROVIDED that the aggregate principal amount of all revolving Indebtedness and letters of credit of the Company and its Restricted Subsidiaries (with letters of credit being deemed to have a principal amount equal to the maximum potential liability of the Company and its Restricted Subsidiaries thereunder) outstanding under the Credit Facility after giving effect to such incurrence, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any other Indebtedness incurred pursuant to this clause (ii), does not exceed $50.0 700.0 million at any one time outstanding less any Net Proceeds the aggregate amount of Asset Sales Sale proceeds applied by the Company and its Restricted Subsidiaries to permanently reduce the Bank availability of revolving credit Indebtedness under the Credit Facility Agreements pursuant to the provisions described in of Section 4.104.10 hereof;
(iiiii) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;
(iiiiv) the incurrence by the Company and its Restricted Subsidiaries the Guarantors of Indebtedness represented by the Senior Notes, the Senior Subordinated Notes Notes, the Senior Subsidiary Guarantees and the Subordinated Subsidiary Guarantees thereof by any Restricted Subsidiaries pursuant limited in aggregate principal amount, without duplication, to amounts outstanding under this Senior Note Indenture and the provisions in Section 12.01 hereofSenior Subordinated Note Indenture as of their respective dates;
(ivv) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of the Company or such Restricted Subsidiary, in an aggregate principal amount amount, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace Indebtedness incurred pursuant to this clause (v), not to exceed $5.0 million at any time outstanding5% of Total Assets;
(vvi) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness in connection with Permitted Refinancing Indebtedness;
(vii) the acquisition of assets or a new Restricted Subsidiary; provided that such Indebtedness was incurred by the prior owner of such assets or such Restricted Subsidiary prior to such acquisition incurrence by the Company or one any of its Restricted Subsidiaries and was not incurred in connection with, or in contemplation of, such acquisition by the Company or one of it Restricted Subsidiaries; and provided further that the principal amount (or accreted value, as applicable) of such Indebtedness, together with any other outstanding Indebtedness incurred pursuant to this clause (v), does not exceed $5.0 million;
(vi) the incurrence of intercompany Indebtedness between or among the Company and any of its Wholly Owned Restricted Subsidiaries; providedPROVIDED, HOWEVER, that (i) if the Company is the obligor on such Indebtedness, such Indebtedness is expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Senior Note and this Senior Note Indenture, (ii) if a Restricted Subsidiary of the Company is the obligor on such Indebtedness, such Indebtedness is expressly subordinated to the prior payment in full in cash of such Restricted Subsidiary's Senior Subsidiary Guarantee and (iii)(A) any subsequent event or issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Wholly Owned Restricted Subsidiary of the Company or and (B) any sale or other transfer of any such Indebtedness to a Person that is neither not either the Company, Company or a Wholly Owned Restricted Subsidiary of the Company, Company shall be deemed deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be;
(vii) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Debt in exchange for, or the net proceeds of which are used to extend, refinance, renew, replace, defease or refund Indebtedness that was not permitted by this Indenture to be incurredclause (vii);
(viii) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt; provided, that if, and to the extent any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company.
(ix) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are incurred in the normal course of business for the purpose of fixing or hedging currency, commodity or interest rate risk (including with respect to any floating rate indebtedness Indebtedness that is permitted by the terms of this Senior Note Indenture to be outstanding; andoutstanding in connection with the conduct of their respective businesses and not for speculative purposes);
(ix) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness in the ordinary course of business solely in respect of performance, surety and similar bonds, completion or performance guarantees or standby letters of credit issued for the purpose of supporting workers' compensation liabilities of the Company or any of its Restricted Subsidiaries, to the extent that such incurrence does not result in the incurrence of any obligation for the payment of borrowed money to others;
(x) the incurrence of Indebtedness arising from agreements of the Company or a Restricted Subsidiary providing for indemnification, adjustment of purchase price or similar obligations, in each case, incurred or assumed in connection with the disposition of any business, assets or a Subsidiary;
(xi) the incurrence by a Restricted Subsidiary of the Company of Indebtedness in connection with and in contemplation of, the concurrent disposition of such Restricted Subsidiary to the stockholders of the Company; PROVIDED that such disposition occurs concurrently with such incurrence and following such disposition, neither the Company nor any of its Restricted Subsidiaries has any liability with respect to such Indebtedness;
(xii) the incurrence by a Securitization Entity of Indebtedness in a Qualified Securitization Transaction that is Non-Recourse Debt with respect to the Company and its other Restricted Subsidiaries (except for Standard Securitization Undertakings and Limited Originator Recourse);
(xiii) the guarantee by the Company and or any of the Guarantors of Indebtedness of the Company or a Restricted Subsidiary of the Company that was permitted to be incurred by another provision of this Section 4.09; and
(xiv) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any other Indebtedness incurred pursuant to this clause (xiv), not to exceed $7.5 million at 75.0 million. For purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (i) through (xiv) above as of the date of incurrence thereof or is entitled to be incurred pursuant to the first paragraph of this Section 4.09 as of the date of incurrence thereof, the Company shall, in its sole discretion, classify or reclassify such item of Indebtedness as of the date of incurrence thereof in any time outstandingmanner that complies with this Section 4.09 and such item of Indebtedness shall be treated as having been incurred pursuant to only one of such clauses or pursuant to the first paragraph of this Section 4.09. Accrual of interest, the accretion of accreted value and the payment of interest in the form of additional Indebtedness will not be deemed to be an incurrence of Indebtedness for purposes of this Section 4.09.
Appears in 1 contract
Sources: Senior Note Indenture (Ball Corp)
Incurrence of Indebtedness and Issuance of Preferred Stock. The Company shall not, and shall not permit any of its Subsidiaries to, directly or indirectly, create, incur, issue, assume, guaranty or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") any Indebtedness (including Acquired Debt); provided, however, that, so long as no Default or Event of Default has occurred and is continuing, the Company and its Restricted Subsidiaries may incur Indebtedness (including Acquired Debt) if the Fixed Charge Coverage Ratio for the Company's most recently ended four full fiscal quarters for which financial statements are available immediately preceding the date on which such additional Indebtedness is incurred would have been at least 2.0 1.8 to 1, determined on a pro forma basis (including a pro forma application of the net proceeds Net Proceeds therefrom), as if the additional Indebtedness had been incurred at the beginning of such four-quarter period. The foregoing provisions will not apply to:
(i) the incurrence by the Company and its Restricted Subsidiaries of Indebtedness pursuant to the Bank Credit Facility in an aggregate principal amount outstanding at the time of any incurrence not to exceed the greater of (x) 65% of inventory plus 85% of accounts receivable of the Company and its Subsidiaries (in each case as determined in accordance with GAAP, but excluding accounts receivable that are past due by more than 60 days and accounts receivable of Lily Cups, Inc. ("Lily Canada")), and (y) $50.0 million at 215.0 million, reduced, in the case of clause (y), by the amount of the proceeds of any one time outstanding less any Net Proceeds of Asset Sales applied to permanently reduce (A) the Bank Credit Facility repayment of principal of term loans thereunder (but only if such loans are outstanding pursuant to this clause (i) and not clause (xii) of this covenant) and (B) the provisions described in Section 4.10permanent reduction to the revolving loan commitments thereunder (but only to the extent revolving loan commitments so reduced relate to Indebtedness outstanding pursuant to this clause (i) and not clause (xii) of this covenant;
(ii) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;
(iii) the incurrence by the Company and its Restricted Subsidiaries of Indebtedness represented by the Senior Subordinated Notes and the Guarantees thereof by any Restricted Subsidiaries pursuant to the provisions in Section 12.01 hereofNote;
(iv) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of the Company or such Restricted Subsidiary, in an aggregate principal amount not to exceed $5.0 25.0 million at any time outstanding;
(v) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness in connection with the acquisition of assets or a new Restricted Subsidiary; provided that such Indebtedness was incurred by the prior owner of such assets or such Restricted Subsidiary prior to such acquisition by the Company or one of its Restricted Subsidiaries and was not incurred in connection with, or in contemplation of, such acquisition by the Company or one of it Restricted Subsidiaries; and provided further that the principal amount (or accreted value, as applicable) of such Indebtedness, together with any other outstanding Indebtedness incurred pursuant to this clause (v), does not exceed $5.0 25.0 million;
(vi) the incurrence of intercompany Indebtedness between or among the Company and any of its Wholly Owned Restricted Subsidiaries; provided, that any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Wholly Owned Restricted Subsidiary of the Company or any sale or other transfer of any such Indebtedness to a Person that is neither the Company, or a Wholly Owned Restricted Subsidiary of the Company, shall be deemed to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be;
(vii) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Debt in exchange for, or the net proceeds of which are used to extend, refinance, renew, replace, defease or refund Indebtedness that was permitted by this Indenture Agreement to be incurred;
(viii) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt; provided, that if, and to the extent any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company.;
(ix) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are Obligations, performance bonds, letter of credit obligations and bank overdrafts incurred for in the purpose ordinary course of fixing business or hedging interest rate risk with respect relating to any floating rate indebtedness that is permitted (as determined in good faith by the Board of Directors) or required by the terms of this Indenture any Indebtedness permitted to be incurred pursuant to this Section 4(e);
(x) Indebtedness of Lily Canada under the Lily Credit Facility, not to exceed the greater of (1) 65% of inventory plus 85% of accounts receivable of Lily Canada and (2) Cn. $30.0 million at any time outstanding, provided that such Indebtedness is without recourse to the Company or any of its Subsidiaries or any of their respective assets (other than Lily Canada and its assets);
(xi) Indebtedness of Global Cup, S.A. de C.V., Rentactivos, S.A. de C.V., Servicios Tanairi, S.A. de C.V. and Paper Cups de Mexico, S.A. de C.V. ("Global") in an amount not to exceed 65% of inventory plus 85% of accounts receivable of Global, provided that such Indebtedness is without recourse to the Company or any of its Subsidiaries or any of their respective assets (other than Global and its assets); and
(xxii) the incurrence by the Company and its Restricted Subsidiaries of additional Indebtedness in an aggregate amount not to exceed $7.5 25.0 million at any time outstanding. Notwithstanding any other provision of this Section 4(e), a guarantee of Indebtedness permitted by the terms of this Agreement at the time such Indebtedness was incurred will not constitute a separate incurrence of Indebtedness.
Appears in 1 contract
Sources: Note Purchase Agreement (Sweetheart Holdings Inc \De\)
Incurrence of Indebtedness and Issuance of Preferred Stock. The Company shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guaranty or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") Incur any Indebtedness (including Acquired Debt)and the Company shall not permit any of its Restricted Subsidiaries to issue any shares of preferred stock; provided, however, that, so long as no Default or Event of Default has occurred and is continuing, that the Company and its Restricted Subsidiaries may incur Incur Indebtedness (including Acquired Debt) if the Fixed Charge Coverage Ratio for the Company's most recently ended four full fiscal quarters for which internal financial statements are available immediately preceding the date on which such additional Indebtedness is incurred Incurred would have been at least 2.0 2.5 to 1, determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the additional Indebtedness had been incurred Incurred at the beginning of such four-quarter period. The foregoing Company shall not Incur any Indebtedness that is subordinate or junior in right of payment to any Senior Indebtedness unless such Indebtedness is Senior Subordinated Indebtedness or is contractually subordinated in right of payment to Senior Subordinated Indebtedness. The provisions will of the first paragraph of this covenant shall not apply to:to the Incurrence by the Company or any Restricted Subsidiary of any of the following items of Indebtedness (collectively, "Permitted Indebtedness"):
(a) Indebtedness pursuant to the Credit Agreement; provided, however, that the aggregate principal amount of all Indebtedness outstanding under the Credit Agreement after giving effect to such Incurrence does not exceed $100.0 million less, without duplication, (i) the incurrence by amount of all repayments of the revolving credit Indebtedness and letters of credit (with letters of credit being deemed to have a principal amount equal to the maximum potential liability of the Company and its Restricted Subsidiaries of Indebtedness pursuant to the Bank Credit Facility in an aggregate principal amount not to exceed $50.0 million at any one time outstanding less thereunder) made utilizing any Net Proceeds of an Asset Sales applied to permanently reduce Sale since the Bank Credit Facility pursuant to the provisions described in Section 4.10;
Issue Date, other than temporary paydowns of such revolving credit Indebtedness and letters of credit pending final application of such Net Proceeds and (ii) the incurrence by aggregate amount of all commitment reductions with respect to revolving credit Indebtedness under the Company and its Restricted Subsidiaries of Credit Agreement that have been made since the Existing IndebtednessIssue Date;
(iiib) the incurrence by the Company and its Restricted Subsidiaries of Indebtedness represented by the Senior Subordinated Notes, the Exchange Notes and the Guarantees thereof by any Restricted Subsidiaries pursuant to the provisions in Section 12.01 hereofthis Indenture;
(ivc) the incurrence by the Company Capital Lease Obligations or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case incurred Incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of the Company or such Restricted Subsidiarybusiness, in an aggregate principal amount not to exceed $5.0 15.0 million at any one time outstanding;
(vd) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in connection with the acquisition of assets or a new Restricted Subsidiary; provided that such respect to Indebtedness was incurred by the prior owner of such assets or such Restricted Subsidiary prior to such acquisition by the Company or one of its Restricted Subsidiaries and was not incurred in connection with, or in contemplation of, such acquisition by the Company or one of it Restricted Subsidiaries; and provided further that the principal amount (or accreted value, as applicable) of such Indebtedness, together with any other outstanding Indebtedness incurred pursuant to this clause (v), does not exceed $5.0 million;
(vi) the incurrence of intercompany Indebtedness between or among the Company and any of its Wholly Owned Restricted Subsidiaries; provided, that any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Wholly Owned Restricted Subsidiary of the Company or any sale or other transfer of any such Indebtedness to a Person that is neither the Company, or a Wholly Owned Restricted Subsidiary of the Company, shall be deemed to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be;
(viiintercompany Indebtedness) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Debt in exchange for, or the net proceeds of which are used to extend, refinance, renew, replace, defease or refund Indebtedness that was permitted by this Indenture to be incurred;
Incurred (viiii) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt; provided, that if, and pursuant to the extent any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of Fixed Charge Coverage Ratio test set forth in the Company.
(ix) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk with respect to any floating rate indebtedness that is permitted by the terms first paragraph of this Indenture to be outstanding; and
Section 4.09 or (xii) the incurrence by the Company and its Restricted Subsidiaries clauses (a), (b) or (e) of additional Indebtedness in an aggregate amount not to exceed $7.5 million at any time outstandingthis Section 4.09.
Appears in 1 contract
Incurrence of Indebtedness and Issuance of Preferred Stock. The Company shall not, and shall not permit any of its Subsidiaries to, directly or indirectly, create, incur, issue, assume, guaranty guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") any Indebtedness (including Acquired Debt), and the Company shall not issue any Disqualified Stock and shall not permit any of its Restricted Subsidiaries to issue any shares of preferred stock; provided, however, that, so long as no Default or Event of Default has occurred and is continuing, that the Company and its any Restricted Subsidiaries Subsidiary may incur Indebtedness (including Acquired Debt) ), and may issue Disqualified Stock, if the Fixed Charge Coverage Leverage Ratio of the Company for the Company's most recently ended four full fiscal quarters for which financial statements are available Reference Period immediately preceding the date on which such additional Indebtedness is incurred or such Disqualified Stock is issued would not have been at least 2.0 greater than 7.0 to 1, determined on a pro forma basis (including a after giving pro forma effect to such incurrence or issuance and to the application of the net proceeds therefrom)) and in accordance with the definition of Leverage Ratio. So long as no Default shall have occurred and be continuing or would be caused thereby, as if the additional first paragraph of this covenant shall not prohibit the incurrence of any of the following items of Indebtedness had been incurred at the beginning of such four-quarter period. The foregoing provisions will not apply to:(collectively, "Permitted Debt"):
(i1) the incurrence by the Company and any Restricted Subsidiary of Indebtedness under the Credit Agreement; provided that the aggregate principal amount of all Indebtedness of the Company and the Restricted Subsidiaries outstanding under the Credit Agreement after giving effect to such incurrence does not exceed an amount equal to $750 million less the aggregate amount of all Net Proceeds of Asset Sales required to be applied by the Company or any of its Restricted Subsidiaries since the date of this Indenture to repay Indebtedness under the Credit Facilities pursuant to Section 4.10 of this Indenture;
(2) the incurrence by the Company and its Restricted Subsidiaries of Indebtedness pursuant to the Bank Credit Facility in an aggregate principal amount not to exceed $50.0 million at any one time outstanding less any Net Proceeds of Asset Sales applied to permanently reduce the Bank Credit Facility pursuant to the provisions described in Section 4.10Existing Indebtedness;
(ii3) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;
(iii) the incurrence by the Company and its Restricted Subsidiaries Guarantors of Indebtedness represented by the Senior Subordinated Notes issued in this Offering and the Guarantees thereof by any Restricted Subsidiaries pursuant to the provisions in Section 12.01 hereofGuarantees;
(iv4) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case case, incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of the Company or such Restricted Subsidiary, in an aggregate principal amount not to exceed $5.0 5 million at any time outstanding;
(v5) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in connection with exchange for, or the acquisition net proceeds of assets which are used to refund, refinance or a new Restricted Subsidiary; provided replace, Indebtedness (other than intercompany Indebtedness) that such Indebtedness was permitted by this Indenture to be incurred by under the prior owner first paragraph of such assets this covenant or such Restricted Subsidiary prior to such acquisition clauses (2), (3), (4), (8) or (9) of this paragraph;
(6) the incurrence by the Company or one any of its Restricted Subsidiaries and was not incurred in connection with, or in contemplation of, such acquisition by the Company or one of it Restricted Subsidiaries; and provided further that the principal amount (or accreted value, as applicable) of such Indebtedness, together with any other outstanding Indebtedness incurred pursuant to this clause (v), does not exceed $5.0 million;
(vi) the incurrence of intercompany Indebtedness between or among the Company and any of its Wholly Owned Restricted SubsidiariesGuarantor; provided, that however, that:
(a) if the Company or any Guarantor is the obligor on such Indebtedness, such Indebtedness must be expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, in the case of the Company, or the Guarantee of such Guarantor, in the case of a Guarantor; and
(i) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Wholly Owned Restricted Subsidiary of the Company or Guarantor and (ii) any sale or other transfer of any such Indebtedness to a Person that is neither not either the Company, Company or a Wholly Owned Restricted Subsidiary of the Company, Guarantor shall be deemed deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be, that was not permitted by this clause (6);
(vii) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Debt in exchange for, or the net proceeds of which are used to extend, refinance, renew, replace, defease or refund Indebtedness that was permitted by this Indenture to be incurred;
(viii) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt; provided, that if, and to the extent any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company.
(ix7) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk with respect to any floating rate indebtedness Indebtedness that is permitted by the terms of this Indenture to be outstanding; and;
(x8) the guarantee by the Company or any of the Restricted Subsidiaries of Indebtedness of the Company or a Restricted Subsidiary of the Company that is also a Guarantor that was permitted to be incurred by another provision of this covenant;
(9) the incurrence by the Company and or any of its Restricted Subsidiaries of additional Indebtedness in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (9), not to exceed $7.5 25.0 million;
(10) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt; provided, however, that if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company that was not permitted by this clause (10);
(11) the accrual of interest, accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms (provided, in each such case, that the amount thereof is included in Fixed Charges of the Company as accrued) , and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock; and
(12) the incurrence by the Company and any Restricted Subsidiary of up to an aggregate principal amount of $250 million at of Indebtedness under the Credit Facilities for the purpose of acquiring Permitted Businesses. For purposes of determining compliance with this "Incurrence of Indebtedness and Issuance of Preferred Stock" covenant, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (1) through (12) above, or is entitled to be incurred pursuant to the first paragraph of this covenant, the Company shall be permitted to classify such item of Indebtedness on the date of its incurrence in any time outstandingmanner that complies with this covenant.
Appears in 1 contract
Sources: Indenture (Emmis 105 5 Fm Radio License Corp of Terre Haute)
Incurrence of Indebtedness and Issuance of Preferred Stock. (a) The Company shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly, createincur any Indebtedness, incur, issue, assume, guaranty or otherwise become directly or indirectly liable, contingently or otherwise, with respect and the Company shall not permit any of its Restricted Subsidiaries to (collectively, "incur") issue any Indebtedness (including Acquired Debt)Preferred Stock; provided, however, that, so long as no Default or Event of Default has occurred and is continuing, that the Company and its Restricted Subsidiaries may incur Indebtedness (including Acquired Debt) if the Fixed Charge Coverage Ratio for the Company's ’s most recently ended four full fiscal quarters for which internal financial statements are available immediately preceding the date on which such additional Indebtedness is incurred would have been at least 2.0 to 1, determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the additional Indebtedness had been incurred at the beginning of such four-quarter period. The foregoing provisions .
(b) Section 4.09(a) hereto will not apply to:prohibit the incurrence of any of the following items of Indebtedness (collectively, “Permitted Debt”):
(i1) the incurrence by the Company and any of its Restricted Subsidiaries of Indebtedness pursuant to the Bank under Credit Facility Facilities in an aggregate principal amount which, when taken together with all other Indebtedness incurred pursuant to this clause (1) and then outstanding, does not exceed (with letters of credit being deemed to exceed have a principal amount equal to the maximum potential liability of the Company and its Restricted Subsidiaries thereunder) the greater of (a) $50.0 225.0 million at any one time outstanding less any (i) the aggregate amount of all Net Proceeds of Asset Sales applied to permanently reduce the Bank Credit Facility pursuant to the provisions described in Section 4.10;
(ii) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;
(iii) the incurrence by the Company and its Restricted Subsidiaries of Indebtedness represented by the Senior Subordinated Notes and the Guarantees thereof by any Restricted Subsidiaries pursuant to the provisions in Section 12.01 hereof;
(iv) the incurrence by the Company or any of its Restricted Subsidiaries to permanently repay any such Indebtedness (and, in the case of any revolving credit Indebtedness, to effect a corresponding commitment reduction thereunder) pursuant to Section 4.10 hereto and (ii) the principal component of amounts outstanding under a Permitted Asset Securitization to the extent a corresponding reduction is required under the Credit Facilities and (b) the Borrowing Base;
(2) Existing Indebtedness of the Company and its Restricted Subsidiaries;
(3) the incurrence by the Company of Indebtedness represented by the Notes to be issued on the date of this Indenture and the Exchange Notes to be issued pursuant to the Registration Rights Agreement and Guarantees of the Notes and any Exchange Notes by Restricted Subsidiaries;
(4) the incurrence by the Company of Indebtedness (i) represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case case, incurred for the purpose of financing all or any part of the purchase price price, lease or cost of construction or improvement of property, plant or equipment used in the business of the Company (whether through the direct purchase of assets or the Capital Stock of any Person owning such Restricted Subsidiaryassets) at the time of, or within 270 days after, such purchase, lease, construction or improvement or (ii) as part of a Sale and Leaseback Transaction, in an aggregate principal amount amount, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (4), not to exceed the greater of (a) $5.0 20.0 million at any time outstandingand (b) 1% of Adjusted Consolidated Net Tangible Assets;
(v5) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in connection with exchange for, or the acquisition net proceeds of assets which are used to refund, refinance or a new Restricted Subsidiary; provided replace Indebtedness (other than intercompany Indebtedness) that such Indebtedness was permitted by this Indenture to be incurred by under subsection 4.09(a) or clauses (2), (3), (4), (5), or (13) of this subsection 4.09(b);
(6) the prior owner of such assets or such Restricted Subsidiary prior to such acquisition incurrence by the Company or one any of its Restricted Subsidiaries of intercompany Indebtedness owing to and was not incurred in connection with, or in contemplation of, such acquisition held by the Company or one of it Restricted Subsidiaries; and provided further that the principal amount (or accreted value, as applicable) of such Indebtedness, together with any other outstanding Indebtedness incurred pursuant to this clause (v), does not exceed $5.0 million;
(vi) the incurrence of intercompany Indebtedness between or among the Company and any of its Wholly Owned Restricted Subsidiaries; provided, that however, that:
(i) if the Company is the obligor on such Indebtedness, such Indebtedness must be unsecured and expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes;
(ii) (A) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Wholly Owned any of its Restricted Subsidiary of the Company or Subsidiaries and (B) any sale or other transfer of any such Indebtedness to a Person that is neither not either the Company, Company or a Wholly Owned any of its Restricted Subsidiary of the CompanySubsidiaries, shall be deemed deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be, that was not permitted by this clause (6); and
(iii) Indebtedness owed to the Company must be evidenced by an unsubordinated promissory note;
(vii7) the Guarantee by the Company and any of its Restricted Subsidiaries of Indebtedness of a Restricted Subsidiary of the Company that was permitted to be incurred by another provision of this Section 4.09;
(8) (i) Indebtedness of the Company and any of its Restricted Subsidiaries under agreements providing for indemnification, adjustment of purchase price or similar obligations, or Guarantees or letters of credit, surety bonds or performance bonds securing any obligations of the Company pursuant to such agreements, in any case incurred in connection with the disposition of any business or assets, so long as the principal amount does not exceed the gross proceeds actually received by the Company in connection with such disposition, (ii) Indebtedness of the Company represented by letters of credit for the account of the Company issued in the ordinary course of business of the Company to provide security for workers’ compensation claims or payment obligations in connection with self-insurance or similar requirements in the ordinary course of business and other Indebtedness with respect to worker’s compensation claims, self-insurance obligations, performance, surety and similar bonds and completion guarantees provided by the Company in the ordinary course of business and (iii) Indebtedness of the Company and any of its Restricted Subsidiaries arising from the honoring by a bank or financial institution of a check, draft of similar instrument drawn against insufficient funds in the ordinary course of business; provided, however, that, in the case of this clause (iii), such Indebtedness is extinguished within five Business Days of its incurrence;
(9) Guarantees of the Company with respect to Operating Lease payments;
(10) Indebtedness of the Company relating to Rental Pool Capital Expenditures in an aggregate principal amount which, when taken together with all other Indebtedness incurred pursuant to this clause (10) and then outstanding, does not exceed the greater of (a) $100.0 million and (b) 40% of the sum of the “Property and Equipment, net” and “Equipment on operating leases, net of accumulated depreciation” line items on the Company’s consolidated balance sheets for the most recently ended fiscal quarter;
(11) Indebtedness of any Foreign Subsidiary in an aggregate principal amount which, when taken together with all other Indebtedness incurred pursuant to this clause (11) and then outstanding, does not exceed $15.0 million;
(12) Indebtedness of the Company and any of its Restricted Subsidiaries incurred in connection with a Permitted Asset Securitization; and
(13) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Debt in exchange for, or the net proceeds of which are used to extend, refinance, renew, replace, defease or refund Indebtedness that was permitted by this Indenture to be incurred;
(viii) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt; provided, that if, and to the extent any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company.
(ix) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk with respect to any floating rate indebtedness that is permitted by the terms of this Indenture to be outstanding; and
(x) the incurrence by the Company and its Restricted Subsidiaries of additional Indebtedness in an aggregate principal amount which, when taken together with all other Indebtedness incurred pursuant to this clause (13) and then outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (13), does not to exceed $7.5 million 15.0 million.
(c) For purposes of determining compliance with this Section 4.09, in the event that any proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (1) through (13) of subsection 4.09(b), or is entitled to be incurred pursuant to subsection 4.09(a), the Company shall be permitted to classify on the date of its incurrence such item of Indebtedness in any manner that complies with this Section 4.09. Indebtedness under the Credit Agreement outstanding on the date of this Indenture shall be deemed to have been incurred on such date in reliance on the exception provided by clause (1) of the definition of Permitted Debt set forth in subsection 4.09(b). In addition, any Indebtedness originally classified as incurred pursuant to clauses (2) through (13) of subsection 4.09(b) may later be reclassified by the Company such that it will be deemed as having been incurred pursuant to another one or more of such clauses to the extent that such reclassified Indebtedness could be incurred pursuant to such other clause or clauses at the time of such reclassification.
(d) Notwithstanding any time outstandingother provision of this Section 4.09, the maximum amount of Indebtedness that may be incurred pursuant to this Section 4.09 shall not be deemed to be exceeded with respect to any outstanding Indebtedness, due solely to the result of fluctuations in the exchange rates of currencies.
(e) Any Indebtedness that is permitted to be incurred pursuant to this Section 4.09 by the Company but not a Restricted Subsidiary may be incurred by any Restricted Subsidiary that Guarantees payment of the Notes and otherwise complies with the requirements of Section 4.21 that would be applicable if such Restricted Subsidiary Guaranteed Indebtedness of the Company.
Appears in 1 contract
Incurrence of Indebtedness and Issuance of Preferred Stock. The Company shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guaranty guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") any Indebtedness (including Acquired Debt), and the Company shall not issue any Disqualified Stock and shall not permit any of its Restricted Subsidiaries to issue any shares of Preferred Stock; provided, however, that, so long as no Default or Event of Default has occurred and is continuing, that the Company and its Restricted Subsidiaries may incur Indebtedness (including Acquired Debt) or issue Disqualified Stock, and the Restricted Subsidiaries (other than the Special Purpose Restricted Subsidiaries) may incur Indebtedness or issue Preferred Stock, if the Fixed Charge Coverage Ratio for the Company's most recently ended four full fiscal quarters for which internal financial statements are available immediately preceding the date on which such additional Indebtedness is incurred or such Disqualified Stock is issued would have been at least 2.0 to 1, 1.0 determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the additional Indebtedness had been incurred or the Preferred Stock or Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period. If such four quarter period includes any period prior to the date of this Indenture, the financial statements for such prior period shall be prepared on a pro forma basis giving effect to the Transactions in accordance with Article 11 of Regulation S-X under the Securities Act. The foregoing provisions will first paragraph of this Section 4.09 shall not apply to:prohibit the incurrence of any of the following items of Indebtedness (collectively, "Permitted Debt"):
(i) the incurrence by the Company and its any Restricted Subsidiaries Subsidiary (other than the Special Purpose Restricted Subsidiaries) of Indebtedness pursuant to the Bank under Credit Facility Facilities in an aggregate principal amount not to exceed $50.0 million at any one time outstanding under this clause (i) not to exceed the Borrowing Base, less the aggregate amount of all mandatory reductions required by Sections 4.10 and 4.16 hereof that have actually been made since the date of this Indenture; provided, that the Indebtedness incurred to refund, refinance or replace any Net Proceeds of Asset Sales applied to permanently reduce the Bank Credit Facility Indebtedness incurred pursuant to the provisions described in Section 4.10this clause (i) need not constitute Permitted Refinancing Indebtedness;
(ii) the incurrence by the Company and its Restricted Subsidiaries (other than the Special Purpose Restricted Subsidiaries) of the Existing Indebtedness;
(iii) the incurrence by the Company and its the Restricted Subsidiaries of Indebtedness represented by the Senior Subordinated First Mortgage Notes to be issued on the date of this Indenture and the Guarantees thereof by any Restricted Subsidiaries Exchange Notes to be issued pursuant to the provisions Registration Rights Agreements (including, in Section 12.01 hereofeach case, the Subsidiary Guarantees);
(iv) the incurrence by the Company or any of its Restricted Subsidiaries (other than the Special Purpose Restricted Subsidiaries) of Permitted Refinancing Indebtedness represented in exchange for, or the net proceeds of which are used to refund, refinance or replace Indebtedness (other than intercompany Indebtedness) that was permitted by Capital Lease Obligationsthis Indenture to be incurred under the first paragraph of this Section 4.09 or clauses (ii), mortgage financings (iii), (iv), (ix) or purchase money obligations, in each case incurred for the purpose (xvi) of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of the Company or such Restricted Subsidiary, in an aggregate principal amount not to exceed $5.0 million at any time outstandingthis paragraph;
(v) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness in connection with the acquisition of assets or a new Restricted Subsidiary; provided that such Indebtedness was incurred by the prior owner of such assets or such Restricted Subsidiary prior to such acquisition by the Company or one of its Restricted Subsidiaries and was not incurred in connection with, or in contemplation of, such acquisition by the Company or one of it Restricted Subsidiaries; and provided further that the principal amount (or accreted value, as applicable) of such Indebtedness, together with any other outstanding Indebtedness incurred pursuant to this clause (v), does not exceed $5.0 million;
(vi) the incurrence of intercompany Indebtedness between or among the Company and any of its Wholly Owned Restricted Subsidiaries; provided, however, that (i) if the Company or any Guarantor is the obligor on such Indebtedness, such Indebtedness must be expressly subordinated to the prior payment in full in cash of all Obligations with respect to the First Mortgage Notes, in the case of the Company, or the Guarantee, in the case of a Guarantor and (ii) (A) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Wholly Owned Restricted Subsidiary of the Company or thereof and (B) any sale or other transfer of any such Indebtedness to a Person that is neither not either the Company, Company or a Wholly Owned Restricted Subsidiary of the Company, thereof shall be deemed deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be, that was not permitted by this clause (v);
(viivi) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Debt in exchange for, or (other than the net proceeds of which are used to extend, refinance, renew, replace, defease or refund Indebtedness that was permitted by this Indenture to be incurred;
(viiiSpecial Purpose Restricted Subsidiaries) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt; provided, that if, and to the extent any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company.
(ix) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk with respect to any floating rate indebtedness Indebtedness that is permitted by the terms of this Indenture to be outstanding; and;
(xvii) the incurrence guarantee by the Company and or any of its Restricted Subsidiaries (other than the Special Purpose Restricted Subsidiaries) of Indebtedness of the Company or a Restricted Subsidiary of the Company that was permitted to be incurred by another provision of this Section 4.09;
(viii) the accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall not be deemed to be an aggregate incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09; provided, in each such case, that the amount not to exceed $7.5 million at any time outstanding.thereof is included in Fixed Charges of the Company as accrued;
Appears in 1 contract
Incurrence of Indebtedness and Issuance of Preferred Stock. (a) The Company shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guaranty Guarantee or otherwise become directly or indirectly liable, contingently or otherwiseotherwise (collectively, “incur”), with respect to (collectively, "incur") any Indebtedness (including Acquired Debt), and the Company shall not permit any of its Restricted Subsidiaries to issue any shares of Preferred Stock; provided, however, that, so long as that if no Default or Event of Default has occurred and is continuingcontinuing at the time of or as a consequence of the incurrence of such Indebtedness, the Company and its Restricted Subsidiaries any Guarantor may incur Indebtedness (including Acquired Debt) if the Fixed Charge Coverage Ratio for the Company's ’s most recently ended four full fiscal quarters for which internal financial statements are available immediately preceding the date on which such additional Indebtedness is incurred would have been at least 2.0 to 1, determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the additional Indebtedness had been incurred and the application of proceeds therefrom had occurred at the beginning of such four-quarter period. The foregoing provisions will not apply to:.
(ib) Section 4.08(a) shall not prohibit the incurrence of any of the following items of Indebtedness (collectively, “Permitted Indebtedness”):
(1) the incurrence by the Company and its Restricted Subsidiaries of Indebtedness pursuant to under the Bank Senior Credit Facility Facilities in an aggregate principal amount not to exceed $50.0 100.0 million at any one time outstanding outstanding, less the amount of any such Indebtedness retired with the Net Proceeds of from any Asset Sales Sale applied to permanently reduce the Bank Credit Facility pursuant to the provisions described in Section 4.10outstanding amounts or commitments thereunder;
(ii2) the incurrence by the Company and any Wholly Owned Restricted Subsidiary of Indebtedness represented by Purchase Money Obligations and Capital Lease Obligations in an aggregate principal amount or accreted value, as applicable, not to exceed the greater of (x) $9.0 million and (y) 15% of Consolidated EBITDA of the Company and its Restricted Subsidiaries for the most recently ended four full fiscal quarters for which internal financial statements are available immediately preceding the date on which such Indebtedness is incurred;
(3) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;
(iii4) the incurrence by the Company and its Restricted Subsidiaries the Guarantors of Indebtedness represented by $210.0 million aggregate principal amount of the Senior Subordinated Notes and the related Subsidiary Guarantees thereof by any Restricted Subsidiaries issued on the Issue Date and the Exchange Notes and the related Subsidiary Guarantees to be issued pursuant to the provisions in Section 12.01 hereofRegistration Rights Agreement;
(iv5) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness represented in exchange for, or the net proceeds of which are used to refund, refinance or replace Indebtedness (other than intercompany Indebtedness) that was permitted by Capital Lease Obligationsthis Indenture to be incurred under Section 4.08(a) or clauses (2), mortgage financings (3), (4), (5), (10) or purchase money obligations, in each case incurred for the purpose (12) of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of the Company or such Restricted Subsidiary, in an aggregate principal amount not to exceed $5.0 million at any time outstandingthis subsection (b);
(v6) the incurrence by the Company or any of its Wholly Owned Restricted Subsidiaries of Indebtedness in connection with the acquisition of assets or a new Restricted Subsidiary; provided that such Indebtedness was incurred by the prior owner of such assets or such Restricted Subsidiary prior to such acquisition by the Company or one of its Restricted Subsidiaries and was not incurred in connection with, or in contemplation of, such acquisition by the Company or one of it Restricted Subsidiaries; and provided further that the principal amount (or accreted value, as applicable) of such Indebtedness, together with any other outstanding Indebtedness incurred pursuant to this clause (v), does not exceed $5.0 million;
(vi) the incurrence of intercompany Indebtedness solely between or among the Company and any of its Wholly Owned Restricted SubsidiariesSubsidiary; provided, that however, that:
(a) such Indebtedness must be expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, in the case of the Company, or the Subsidiary Guarantee, in the case of a Guarantor; and
(i) any subsequent issuance or transfer of Equity Interests Capital Stock that results in any such Indebtedness being held by a Person other than the Company or a Wholly Owned Restricted Subsidiary of the Company or thereof and (ii) any sale or other transfer of any such Indebtedness to a Person that is neither not either the Company, Company or a Wholly Owned Restricted Subsidiary of the Companythereof, shall be deemed deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Wholly Owned Restricted Subsidiary, as the case may be, that was not permitted by this clause (6);
(vii7) the incurrence by the Company or any Restricted Subsidiary of Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk with respect to any floating rate Indebtedness that is permitted by the terms of this Indenture to be outstanding; provided that the notional principal amount of each such Hedging Obligation does not exceed the principal amount of the Indebtedness to which such Hedging Obligation relates;
(8) the Guarantee by the Company or any of the Restricted Subsidiaries of Indebtedness (other than Non-Recourse Indebtedness of an Unrestricted Subsidiary) of the Company or a Guarantor that was permitted to be incurred by another provision of this Section;
(9) the accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock; provided, in each such case, that the amount thereof is included in Fixed Charges of the Company as accrued;
(10) the incurrence by the Company or any of its Restricted Subsidiaries the Guarantors of additional Indebtedness that is contractually subordinated to the Notes in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Debt in exchange forIndebtedness incurred to refund, refinance or the net proceeds of which are used replace any Indebtedness incurred pursuant to extendthis clause (10), refinance, renew, replace, defease or refund Indebtedness that was permitted by this Indenture not to be incurredexceed $25.0 million at any one time outstanding;
(viii11) the incurrence by the Company's ’s Unrestricted Subsidiaries of Non-Recourse DebtIndebtedness; provided, however, that if, and to the extent if any such Indebtedness ceases to be Non-Recourse Debt Indebtedness of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company.Company that was not permitted by this clause (11);
(ix12) the incurrence by the Company or any of its Wholly-Owned Restricted Subsidiaries of Hedging Obligations Indebtedness equal to 200.0% of the net cash proceeds received by the Company since the Issue Date from the issuance or sale of Capital Stock of the Company or cash contributed to the capital of the Company (in each case, other than proceeds of Disqualified Stock or sales of Capital Stock to the Company or any of its Subsidiaries) to the extent such proceeds have not been applied pursuant to Section 4.07(a)(III) to make other Investments or payment pursuant to Section 4.07(b) or to make Permitted Investments (other then those specified in clauses (1), (2) or (3) of the definition thereof);
(13) Indebtedness incurred by the Company or any of its Restricted Subsidiaries constituting reimbursement obligations with respect to letters of credit issued in the ordinary course of business, including letters of credit in respect of workers’ compensation claims, or other Indebtedness with respect to reimbursement type obligations regarding workers’ compensation claims; provided, however, that upon the drawing of such letters of credit or the incurrence of such Indebtedness, such obligations are reimbursed within 5 days following such drawing or incurrence;
(14) Indebtedness arising from agreements of the Company or its Restricted Subsidiaries providing for indemnification, adjustment of purchase price or similar obligations, in each case, incurred or assumed in connection with the disposition of any business, assets or a Subsidiary, other than guarantees of Indebtedness incurred by any Person acquiring all or any portion of such business, assets or a Subsidiary for the purpose of fixing financing such acquisition; provided, however, that
(a) such Indebtedness is not reflected on the balance sheet of the Company, or hedging interest rate risk with respect any of its Restricted Subsidiaries (contingent obligations referred to any floating rate indebtedness that is permitted by in a footnote to financial statements and not otherwise reflected on the terms balance sheet will not be deemed to be reflected on such balance sheet for purposes of this Indenture to be outstandingSection 4.08(14)(a)); and
(xb) the incurrence maximum assumable liability in respect of all such Indebtedness shall at no time exceed the gross proceeds including non-cash proceeds (the fair market value of such non-cash proceeds being measured at the time received and without giving effect to any subsequent changes in value) actually received by the Company and its Restricted Subsidiaries in connection with such disposition;
(15) obligations in respect of additional performance, bid, appeal and surety bonds and completion guarantees provided by the Company or any of its Restricted Subsidiaries in the ordinary course of business;
(16) Indebtedness arising from the honoring by a bank or other financial institution of a check, draft or similar instrument drawn against insufficient funds in the ordinary course of business, provided that such Indebtedness is extinguished within two Business Days of its incurrence;
(17) Indebtedness of the Company or any Guarantor in an aggregate amount not to exceed $5.0 million at any time outstanding; and
(18) unsecured Indebtedness of the Company or any Restricted Subsidiary in favor of ▇▇▇▇▇▇ ▇▇▇▇, or his successor, heir or assignee in an aggregate amount not to exceed $7.5 million million.
(c) For purposes of determining compliance with this Section 4.08,
(1) in the event that an item of Indebtedness meets the criteria of more than one of the categories of Permitted Indebtedness described in clauses (1) through (18) above, or is entitled to be incurred pursuant to subsection (a) of this Section 4.08, the Company will be permitted to classify or reclassify such item of Indebtedness (or any portion thereof) on the date of its incurrence, in any manner that complies with this Section; provided that all Indebtedness outstanding under the Senior Credit Facilities on the Issue Date will be treated as incurred on the Issue Date under Section 4.08(b)(1); and
(2) at the time of incurrence, the Company will be entitled to divide and classify an item of Indebtedness in more than one of the types of Indebtedness described in Sections 4.08(a) and (b) above.
(d) The Company will not permit any time outstandingGuarantor to, directly or indirectly, incur any Indebtedness (including Acquired Debt) that is subordinated or junior in right of payment to any Indebtedness of the Company or such Guarantor, as the case may be, unless such Indebtedness is expressly subordinated in right of payment to the Notes or such Guarantor’s Guarantee to the extent and in the same manner as such Indebtedness is subordinated to other Indebtedness of the Company or such Guarantor, as the case may be. This Indenture will not treat (1) unsecured Indebtedness as subordinated or junior to secured Indebtedness merely because it is unsecured or (2) Senior Indebtedness as subordi- nated or junior to any other Senior Indebtedness merely because it has junior priority with respect to the same collateral.
Appears in 1 contract
Sources: Indenture (Jacobs Entertainment Inc)
Incurrence of Indebtedness and Issuance of Preferred Stock. (a) The Company shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guaranty or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") incur any Indebtedness (including Acquired Debt), and the Company shall not permit any of its Restricted Subsidiaries to issue any Preferred Stock; provided, however, that, so long as no Default or Event of Default has occurred and is continuing, that the Company and or any of its Restricted Subsidiaries may incur Indebtedness (including Acquired Debt) Indebtedness, if the Fixed Charge Coverage Ratio for the Company's most recently ended four full fiscal quarters for which internal financial statements are available immediately preceding the date on which such additional Indebtedness is incurred would have been at least 2.0 to 1, determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), ) as if the additional Indebtedness had been incurred at the beginning of such four-quarter period. The foregoing provisions will .
(b) So long as no Default shall have occurred and be continuing or would be caused thereby, Section 4.09(a) shall not apply to:prohibit the incurrence of any of the following items of Indebtedness (collectively, "Permitted Debt"):
(i) the incurrence by the Company and its Restricted Subsidiaries of Indebtedness pursuant to the Bank under Credit Facility Facilities in an aggregate principal amount not to exceed $50.0 million at any one time outstanding (with letters of credit being deemed to have a principal amount equal to the maximum potential liability of the Company and its Restricted Subsidiaries thereunder) not to exceed $390.0 million, less any the aggregate amount of all Net Proceeds of Asset Sales applied by the Company or any Restricted Subsidiary of the Company to permanently reduce repay any such Indebtedness (and, in the Bank Credit Facility case of any revolving credit Indebtedness, to effect a corresponding commitment reduction thereunder) pursuant to the provisions described in Section 4.10;
(ii) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;
(iii) the incurrence by the Company and its Restricted Subsidiaries of Indebtedness represented by the Senior Subordinated Notes and to be issued on the Guarantees thereof by any Restricted Subsidiaries pursuant to the provisions in Section 12.01 hereofdate of this Indenture;
(iv) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case case, incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of the Company or such Restricted Subsidiary, in an aggregate principal amount amount, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (iv), not to exceed the greater of (a) $5.0 40.0 million at any time outstandingoutstanding and (b) 5% of the Consolidated Net Tangible Assets of the Company;
(v) the incurrence by the Company or any Restricted Subsidiary of the Company of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to refund, refinance or replace Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture to be incurred under this Section 4.09(a) or clauses (ii), (iii), (iv), (v), (ix) or (x) of this Section 4.09(b);
(vi) the incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness in connection with the acquisition of assets or a new Restricted Subsidiary; provided that such Indebtedness was incurred by the prior owner of such assets or such Restricted Subsidiary prior owing to such acquisition and held by the Company or one of its Restricted Subsidiaries and was not incurred in connection with, or in contemplation of, such acquisition by the Company or one of it Restricted Subsidiaries; and provided further that the principal amount (or accreted value, as applicable) of such Indebtedness, together with any other outstanding Indebtedness incurred pursuant to this clause (v), does not exceed $5.0 million;
(vi) the incurrence of intercompany Indebtedness between or among the Company and any of its Wholly Owned Restricted Subsidiaries; provided, that however, that:
(a) if the Company or any Guarantor is the obligor on such Indebtedness, such Indebtedness must be unsecured and expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, in the case of the Company, or the Note Guarantee, in the case of a Guarantor;
(b) Indebtedness owed to the Company or any Guarantor may not be subordinated in right of payment to any other indebtedness of the obligor of such Indebtedness, unless the obligor of such Indebtedness is the Company or a Guarantor; and
(c) (i) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Wholly Owned Restricted Subsidiary of the Company or thereof and (ii) any sale or other transfer of any such Indebtedness to a Person that is neither not either the Company, Company or a Wholly Owned Restricted Subsidiary of the Companythereof, shall be deemed deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be, that was not permitted by this clause (vi);
(vii) the Guarantee by the Company or any of its Restricted Subsidiaries of Indebtedness of the Company or a Restricted Subsidiary of the Company that was permitted to be incurred by another provision of this Section 4.09;
(viii) the incurrence of Indebtedness pursuant to the Supplemental Plan in an aggregate amount not to exceed $20 million outstanding at any time;
(ix) the incurrence of Indebtedness by any Foreign Subsidiary, in an aggregate principal amount not to exceed $50 million outstanding at any time; or
(x) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Debt in exchange for, or the net proceeds of which are used to extend, refinance, renew, replace, defease or refund Indebtedness that was permitted by this Indenture to be incurred;
(viii) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt; provided, that if, and to the extent any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company.
(ix) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk with respect to any floating rate indebtedness that is permitted by the terms of this Indenture to be outstanding; and
(x) the incurrence by the Company and its Restricted Subsidiaries of additional Indebtedness in an aggregate principal amount at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (x), not to exceed $7.5 million 100 million. For purposes of determining compliance with this Section 4.09, in the event that any proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (i) through (x) above, or is entitled to be incurred pursuant to Section 4.09(a), the Company shall be permitted to classify at the time of its incurrence such item of Indebtedness in any manner that complies with this Section 4.09. In addition, any Indebtedness originally classified as incurred pursuant to Section 4.09(a) or pursuant to clauses 4.09(b)(i) through (x) above may later be reclassified by the Company such that it shall be deemed as having been incurred pursuant to Section 4.09(a) or pursuant to another of such clauses to the extent that such reclassified Indebtedness could be incurred pursuant to Section 4.09(a) or such new clause at the time outstandingof such reclassification.
(c) Notwithstanding any other provision of this Section 4.09, the maximum amount of Indebtedness that may be incurred pursuant to this Section 4.09 shall not be deemed to be exceeded with respect to any outstanding Indebtedness due solely to the result of fluctuations in the exchange rates of currencies.
Appears in 1 contract
Sources: Indenture (Moog Inc)
Incurrence of Indebtedness and Issuance of Preferred Stock. (a) The Company shall will not, and shall will not cause or permit any of its Restricted Subsidiaries to, directly or indirectly, createIncur any Indebtedness, incur, issue, assume, guaranty or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") any Indebtedness (including Acquired Debt); providedIndebtedness, howeveror permit any Restricted Subsidiary to Incur Preferred Stock, thatexcept that the Company and any Guarantor may Incur Indebtedness, so long as including Acquired Indebtedness, if, at the time of and immediately after giving pro forma effect to the Incurrence thereof and the application of the proceeds therefrom, no Default or Event of Default has shall have occurred and is continuingbe continuing and the Consolidated Leverage Ratio would be greater than zero and less than 3.50 to 1.0.
(b) Notwithstanding Section 3.9(a), the Company and its Restricted Subsidiaries may incur Incur Permitted Indebtedness as provided in the definition thereof. For purposes of determining compliance with this Section 3.9, in the event that an item of Indebtedness meets the criteria of more than one of the categories of "Permitted Indebtedness" described in clauses (including Acquired Debt1) if through (16) of the Fixed Charge Coverage Ratio for definition thereof, the Company's most recently ended four full fiscal quarters for which financial statements are available immediately preceding Company shall, in its sole discretion, classify (or later reclassify) such item of Indebtedness in any manner that complies with this covenant.
(c) For purposes of determining compliance with, and the date on which such outstanding principal amount of, any particular Indebtedness Incurred pursuant to and in compliance with this covenant, the amount of Indebtedness issued at a price that is less than the principal amount thereof will be equal to the amount of the liability in respect thereof determined in accordance with GAAP. Accrual of interest, the accretion or amortization of original issue discount, the payment of regularly scheduled interest in the form of additional Indebtedness of the same instrument or the payment of regularly scheduled dividends on Disqualified Capital Stock or Preferred Stock in the form of additional Disqualified Capital Stock or Preferred Stock with the same terms will not be deemed to be an Incurrence of Indebtedness or Preferred Stock for purposes of this covenant.
(d) For purposes of determining compliance with any U.S. dollar-denominated restriction on the Incurrence of Indebtedness where the Indebtedness Incurred is incurred would have been at least 2.0 to 1denominated in a different currency, the amount of such Indebtedness will be the U.S. Dollar Equivalent, determined on a pro forma basis (including a pro forma application the date of the net proceeds therefrom)Incurrence, as if the additional Indebtedness had been incurred at the beginning of such four-quarter periodIndebtedness; provided, however, that if any such Indebtedness denominated in a different currency is subject to a Currency Agreement with respect to U.S. dollars covering all principal, premium, if any, and interest payable on such Indebtedness, the amount of such Indebtedness expressed in U.S. dollars will be as provided in such Currency Agreement. The foregoing provisions principal amount of any Refinancing Indebtedness Incurred in the same currency as the Indebtedness being Refinanced will not apply to:
(i) be the incurrence by U.S. Dollar Equivalent of the Company and its Restricted Subsidiaries of Indebtedness pursuant Refinanced, determined in accordance with the preceding sentence, except to the Bank Credit Facility in an aggregate principal amount not to exceed $50.0 million at any one time outstanding less any Net Proceeds of Asset Sales applied to permanently reduce the Bank Credit Facility pursuant to the provisions described in Section 4.10;
(ii) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;
(iii) the incurrence by the Company and its Restricted Subsidiaries of Indebtedness represented by the Senior Subordinated Notes and the Guarantees thereof by any Restricted Subsidiaries pursuant to the provisions in Section 12.01 hereof;
(iv) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of the Company or such Restricted Subsidiary, in an aggregate principal amount not to exceed $5.0 million at any time outstanding;
(v) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness in connection with the acquisition of assets or a new Restricted Subsidiary; provided that such Indebtedness was incurred by the prior owner of such assets or such Restricted Subsidiary prior to such acquisition by the Company or one of its Restricted Subsidiaries and was not incurred in connection with, or in contemplation of, such acquisition by the Company or one of it Restricted Subsidiaries; and provided further extent that the principal amount (or accreted valueof the Refinancing Indebtedness exceeds the principal amount of the Indebtedness being Refinanced, as applicable) in which case the U.S. Dollar Equivalent of such Indebtedness, together with any other outstanding excess will be determined on the date such Refinancing Indebtedness incurred pursuant to this clause (v), does not exceed $5.0 million;
(vi) the incurrence of intercompany Indebtedness between or among the Company and any of its Wholly Owned Restricted Subsidiaries; provided, that any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Wholly Owned Restricted Subsidiary of the Company or any sale or other transfer of any such Indebtedness to a Person that is neither the Company, or a Wholly Owned Restricted Subsidiary of the Company, shall be deemed to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be;
(vii) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Debt in exchange for, or the net proceeds of which are used to extend, refinance, renew, replace, defease or refund Indebtedness that was permitted by this Indenture to be incurred;
(viii) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt; provided, that if, and to the extent any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the CompanyIncurred.
(ix) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk with respect to any floating rate indebtedness that is permitted by the terms of this Indenture to be outstanding; and
(x) the incurrence by the Company and its Restricted Subsidiaries of additional Indebtedness in an aggregate amount not to exceed $7.5 million at any time outstanding.
Appears in 1 contract
Sources: Indenture (Movie Gallery Inc)
Incurrence of Indebtedness and Issuance of Preferred Stock. (a) The Company shall will not, and shall will not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guaranty guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incurINCUR") any Indebtedness and the Company will not issue any Disqualified Stock and will not permit any of its Restricted Subsidiaries to issue any shares of preferred stock; PROVIDED, HOWEVER, that the Company may incur Indebtedness or issue Disqualified Stock, and the Company's Restricted Subsidiaries that are Guarantors may incur Indebtedness or issue preferred stock, if, after giving pro forma effect thereto (including Acquired Debta pro forma application of the net proceeds therefrom); provided, howeverthe Company's Debt to Cash Flow Ratio immediately preceding the incurrence of such additional Indebtedness or the issuance of such Disqualified Stock or preferred stock, thatas the case may be, so long as would have been no Default or Event greater than 7.0 to 1.
(b) The provisions of Default has occurred Section 4.09(a) hereof will not prohibit the incurrence of any of the following items of Indebtedness (collectively, "PERMITTED DEBT"):
(1) the incurrence by the Company and is continuing, any of its Restricted Subsidiaries of additional Indebtedness and letters of credit in an aggregate principal amount at any one time outstanding under this clause (1) (with letters of credit being deemed to have a 52 principal amount equal to the maximum potential liability of the Company and its Restricted Subsidiaries may incur thereunder), including all Permitted Refinancing Indebtedness incurred to extend, renew, refund, refinance, replace, defease or discharge any Indebtedness incurred pursuant to this clause (including Acquired Debt1), not to exceed the greater of (a) if the Fixed Charge Coverage Ratio for 1.5 times the Company's Consolidated Cash Flow for the most recently ended four full fiscal quarters for which internal financial statements are available immediately preceding the date on which such additional Indebtedness is incurred would have been at least 2.0 to 1, determined on a pro forma basis and (including a pro forma application of the net proceeds therefrom), as if the additional Indebtedness had been incurred at the beginning of such four-quarter period. The foregoing provisions will not apply to:
(ib) the incurrence by the Company and its Restricted Subsidiaries of Indebtedness pursuant to the Bank Credit Facility in an aggregate principal amount not to exceed $50.0 million at any one time outstanding less any Net Proceeds of Asset Sales applied to permanently reduce the Bank Credit Facility pursuant to the provisions described in Section 4.1045.0 million;
(ii2) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;
(iii3) the incurrence by the Company and its Restricted Subsidiaries the Guarantors of Indebtedness represented by the Senior Subordinated Notes and the related Guarantees thereof by any Restricted Subsidiaries to be issued on the date of this Indenture, and the Exchange Notes and the related Guarantees to be issued pursuant to the provisions in Section 12.01 hereofRegistration Rights Agreement;
(iv4) the incurrence by the Company or any of its Restricted Subsidiaries the Guarantors of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case case, incurred for the purpose of financing all or any part of the purchase price or cost of construction design, construction, installation or improvement of property, plant or equipment used in the business of the Company or such any of its Restricted SubsidiarySubsidiaries, in an aggregate principal amount amount, including all Permitted Refinancing Indebtedness incurred to extend, renew, refund, refinance, replace, defease or discharge any Indebtedness incurred pursuant to this clause (4), not to exceed $5.0 10.0 million at any time outstanding;
(v5) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in connection with exchange for, or the acquisition net proceeds of assets which are used to extend, renew, refund, refinance, replace, defease or a new Restricted Subsidiary; provided discharge any Indebtedness (other than intercompany Indebtedness) that such Indebtedness was permitted by this Indenture to be incurred by under Section 4.09(a) hereof or clauses (2), (3), (5) or (12) of this Section 4.09(b);
(6) the prior owner of such assets or such Restricted Subsidiary prior to such acquisition incurrence by the Company or one any of its Restricted Subsidiaries and was not incurred in connection with, or in contemplation of, such acquisition by the Company or one of it Restricted Subsidiaries; and provided further that the principal amount (or accreted value, as applicable) of such Indebtedness, together with any other outstanding Indebtedness incurred pursuant to this clause (v), does not exceed $5.0 million;
(vi) the incurrence of intercompany Indebtedness between or among the Company and any of its Wholly Owned Restricted Subsidiaries; providedPROVIDED, HOWEVER, that (a) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Wholly Owned Restricted Subsidiary of the Company or and (b) any sale or other transfer of any such Indebtedness to a Person that is neither not either the Company, Company or a Wholly Owned Restricted Subsidiary of the Company, shall will be deemed deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be, that was not permitted by this clause (6);
(vii7) the incurrence issuance by any of the Company's Restricted Subsidiaries to the Company or to any of its Restricted Subsidiaries of Permitted Refinancing Debt in exchange forshares of preferred stock; PROVIDED, or the net proceeds of which are used to extendHOWEVER, refinance, renew, replace, defease or refund Indebtedness that was permitted by this Indenture to be incurred;that:
(viiiA) the incurrence by the Company's Unrestricted Subsidiaries any subsequent issuance or transfer of Non-Recourse Debt; provided, Equity Interests that if, and to the extent results in any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness preferred stock being held by a Person other than the Company or a Restricted Subsidiary of the Company.; and
(ixB) any sale or other transfer of any such preferred stock to a Person that is not either the Company or a Restricted Subsidiary of the Company, will be deemed, in each case, to constitute an issuance of such preferred stock by such Restricted Subsidiary that was not permitted by this clause (7);
(8) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are incurred for in the purpose ordinary course of fixing or hedging interest rate risk with respect to any floating rate indebtedness that is permitted business;
(9) the guarantee by the terms Company or any of the Guarantors of Indebtedness of the Company or a Restricted Subsidiary of the Company that was permitted to be incurred by another provision of this Indenture Section 4.09; PROVIDED that if the Indebtedness being guaranteed is subordinated to or pari passu with the Notes, then the guarantee shall be outstanding; andsubordinated or pari passu, as applicable, to the same extent as the Indebtedness guaranteed;
(x10) the incurrence by the Company and or any of its Restricted Subsidiaries of Indebtedness in respect of workers' compensation claims, self-insurance obligations, bankers' acceptances, performance and surety bonds in the ordinary course of business;
(11) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness arising from the honoring by a bank or other financial institution of a check, draft or similar instrument inadvertently drawn against insufficient funds, so long as such Indebtedness is covered within five Business Days; and
(12) Acquired Debt incurred at the time a Sprint PCS Affiliate is merged with or into or becomes a subsidiary of or transfers all or substantially all of its assets to the Company or a Guarantor on or prior to December 31, 2005, but only to the extent that immediately after giving effect to the incurrence of such Indebtedness (a) the Company's Debt to Cash Flow Ratio would have been no greater than 7.75 to 1.0; and (b) the Company's Debt to Cash Flow Ratio immediately following such incurrence would decrease as compared to the Company's Debt to Cash Flow Ratio immediately prior to such incurrence. The Company will not incur, and will not permit any Guarantor to incur, any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Company or such Guarantor unless such Indebtedness is also contractually subordinated in right of payment to the Notes and the applicable Guarantee on substantially identical terms; PROVIDED, HOWEVER, that no Indebtedness will be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company solely by virtue of being unsecured or by virtue of being secured on a first or junior Lien basis. For purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (1) through (12) above, or is entitled to be incurred pursuant to Section 4.09(a) hereof, the Company will be permitted to classify such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09. The accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, the reclassification of preferred stock as Indebtedness due to a change in accounting principles, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock will not be deemed to be an aggregate incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09; PROVIDED, in each such case, that the amount of any such accrual, accretion or payment is included in Consolidated Interest Expense of the Company as accrued. Notwithstanding any other provision of this Section 4.09, the maximum amount of Indebtedness that the Company or any Restricted Subsidiary may incur pursuant to this Section 4.09 shall not be deemed to exceed $7.5 million at any time outstandingbe exceeded solely as a result of fluctuations in exchange rates or currency values.
Appears in 1 contract
Sources: Indenture (Ipcs Inc)
Incurrence of Indebtedness and Issuance of Preferred Stock. The Company shall not, and shall not permit any of its Subsidiaries to, directly or indirectly, create, incur, issue, assume, guaranty guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incurINCUR") any Indebtedness (including Acquired Debt); provided, however, that, so long as no Default or Event of Default has occurred and is continuing, the Company shall not issue any Disqualified Stock and shall not permit any of its Restricted Subsidiaries to issue any shares of preferred stock; PROVIDED, HOWEVER, that the Company may incur Indebtedness (including Acquired Debt) or issue Disqualified Stock, and the Guarantors may incur Indebtedness or issue preferred stock, if the Fixed Charge Coverage Ratio for the Company's most recently ended four full fiscal quarters for which internal financial statements are available immediately preceding the date on which such additional Indebtedness is incurred or such Disqualified Stock is issued would have been at least 2.0 to 11.0, determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the additional Indebtedness had been incurred or Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period. The foregoing provisions will preceding paragraph of this Section 4.09 shall not apply to:prohibit the incurrence of any of the following items of Indebtedness (collectively, "PERMITTED DEBT"):
(i) the incurrence by the Company and its or any Restricted Subsidiaries Subsidiary of Indebtedness pursuant to the Bank and letters of credit under Credit Facility Facilities in an aggregate principal amount not to exceed $50.0 million at any one time outstanding under this clause (i) (with letters of credit being deemed to have a principal amount equal to the maximum potential liability of the Company and its Restricted Subsidiaries thereunder) not to exceed $200.0 million less any the aggregate amount of all Net Proceeds of Asset Sales applied by the Company or any of its Restricted Subsidiaries to permanently reduce repay any Indebtedness under Credit Facilities and, in the Bank Credit Facility case of revolving Indebtedness, effect a corresponding commitment reduction thereunder pursuant to the provisions described in Section 4.104.10 hereof;
(ii) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;
(iii) the incurrence by the Company and its Restricted Subsidiaries the Guarantors of Indebtedness represented by the Senior Subordinated Notes and the related Subsidiary Guarantees thereof by any Restricted Subsidiaries to be issued on the date of this Indenture and the Exchange Notes and the related Subsidiary Guarantees to be issued pursuant to the provisions in Section 12.01 hereofRegistration Rights Agreement;
(iv) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case case, incurred within 360 days of the acquisition or completion of construction or installation for the purpose of financing all or any part of the purchase price or cost of construction construction, installation or improvement of property, plant or equipment used in the business of the Company or such Restricted Subsidiary, in an aggregate principal amount amount, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (iv), not to exceed $5.0 10.0 million at any time outstanding;
(v) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in connection with the acquisition of assets or a new Restricted Subsidiary; provided that such Indebtedness was incurred by the prior owner of such assets or such Restricted Subsidiary prior to such acquisition by the Company or one of its Restricted Subsidiaries and was not incurred in connection withexchange for, or in contemplation ofthe net proceeds of which are used to refund, such acquisition refinance or replace Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture to be incurred under the Company first paragraph of this Section 4.09 or one of it Restricted Subsidiaries; and provided further that the principal amount clauses (or accreted valueii), as applicable) of such Indebtedness(iii), together with any other outstanding Indebtedness incurred pursuant to this clause (iv), (v), does not exceed $5.0 million(xi) or (xii) of this paragraph;
(vi) the incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness between or among the Company and any of its Wholly Owned Restricted Subsidiaries; providedPROVIDED, that HOWEVER, that: (A) if the Company or any Guarantor is the obligor on such Indebtedness (other than any Indebtedness between or among the Company and any Guarantor), such Indebtedness must be expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, in the case of the Company, or the Subsidiary Guarantee, in the case of a Guarantor; and (B)(1) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Wholly Owned Restricted Subsidiary of the Company or and (2) any sale or other transfer of any such Indebtedness to a Person that is neither not either the Company, Company or a Wholly Owned Restricted Subsidiary of the Company, shall will be deemed deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be, that was not permitted by this clause (vi);
(vii) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Debt in exchange for, or the net proceeds of which are used to extend, refinance, renew, replace, defease or refund Indebtedness that was permitted by this Indenture to be incurred;
(viii) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt; provided, that if, and to the extent any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company.
(ix) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk with respect to any floating rate indebtedness Indebtedness that is permitted by the terms of this Indenture to be outstandingoutstanding or Hedging Obligations with respect to hedging foreign currency in the ordinary course of business;
(viii) the guarantee by the Company or any of the Guarantors of Indebtedness of the Company or a Restricted Subsidiary of the Company that was permitted to be incurred by another provision of this Section 4.09;
(ix) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt, PROVIDED, HOWEVER, that if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event will be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company that was not permitted by this clause (ix); 41
(x) Indebtedness incurred by the Company or any of its Restricted Subsidiaries constituting reimbursement obligations with respect to letters of credit issued in the ordinary course of business, including, without limitation, letters of credit in respect of workers' compensation claims or self-insurance, or other Indebtedness with respect to reimbursement type obligations regarding workers' compensation claims and letters of credit and bankers acceptances for the purchase of inventory and other goods;
(xi) Indebtedness of Foreign Subsidiaries in an amount outstanding at any time not to exceed $15.0 million; and
(xxii) the incurrence by the Company and its Restricted Subsidiaries the Guarantors of additional Indebtedness (which additional Indebtedness may be incurred under a Credit Facility) in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (xii), not to exceed $7.5 million at 25.0 million. The accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any time outstandingIndebtedness in the form of additional Indebtedness with the same terms and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09; PROVIDED, in each such case, that the amount thereof shall be included in Fixed Charges of the Company as accrued. For purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (i) through (xii) above, or is entitled to be incurred pursuant to the first paragraph of this Section 4.09, the Company shall be permitted to classify such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09. Indebtedness under Credit Facilities outstanding on the date on which Notes are first issued and authenticated under this Indenture shall be deemed to have been incurred on such date in reliance on the exception provided by clause (i) of the definition of Permitted Debt.
Appears in 1 contract
Sources: Indenture (Carters Imagination Inc)
Incurrence of Indebtedness and Issuance of Preferred Stock. (a) The Company shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guaranty or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") incur any Indebtedness (including Acquired Debt), and the Company shall not permit any of its Restricted Subsidiaries to issue any preferred stock; provided, however, that, so long as no Default or Event of Default has occurred and is continuing, that the Company and its Restricted Subsidiaries or any Guarantor may incur Indebtedness (including Acquired Debt) Indebtedness, if the Fixed Charge Coverage Ratio for the Company's ’s most recently ended four full fiscal quarters for which internal financial statements are available immediately preceding the date on which such additional Indebtedness is incurred would have been at least 2.0 2 to 1, determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the additional Indebtedness had been incurred at the beginning of such four-fourth quarter period. The foregoing provisions will .
(b) So long as no Default shall have occurred and be continuing or would be caused thereby, Section 4.09(a) shall not apply to:prohibit the incurrence of any of the following items of Indebtedness (collectively, “Permitted Debt”):
(i) the incurrence by (A) the Company or any Foreign Subsidiary of the Company of Indebtedness under Credit Facilities (and the incurrence by the Guarantors of Guarantees thereof) in an aggregate principal amount at any one time outstanding pursuant to this clause (i) (with letters of credit being deemed to have a principal amount equal to the maximum potential liability of the Company and its Restricted Subsidiaries of Indebtedness pursuant to the Bank Credit Facility in an aggregate principal amount thereunder) not to exceed $50.0 million at any one time outstanding 1.6 billion, less any the aggregate amount of all Net Proceeds of Asset Sales applied by the Company or any Restricted Subsidiary to permanently reduce repay any such Indebtedness (and, in the Bank Credit Facility case of any revolving credit Indebtedness, to effect a corresponding commitment reduction thereunder) pursuant to the provisions described in Section 4.104.10 and (B) Foreign Subsidiaries of Guarantees of other Foreign Subsidiaries’ Indebtedness under Credit Facilities;
(ii) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;
(iii) the incurrence by the Company and its Restricted Subsidiaries the Guarantors of Indebtedness represented by the Senior Subordinated Notes and the related Note Guarantees thereof by any Restricted Subsidiaries pursuant to be issued on the provisions in Section 12.01 hereofIssue Date;
(iv) the incurrence by the Company or any of its Restricted Subsidiaries Guarantor of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case case, incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of the Company or such Restricted SubsidiaryGuarantor, in an aggregate principal amount amount, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (iv), not to exceed $5.0 30.0 million at any time outstanding;
(v) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness in connection with the acquisition of assets or a new Restricted Subsidiary; provided that such Indebtedness was incurred by the prior owner of such assets or such Restricted Subsidiary prior to such acquisition by the Company or one of its Restricted Subsidiaries and was not incurred in connection with, or in contemplation of, such acquisition by the Company or one of it Restricted Subsidiaries; and provided further that the principal amount (or accreted value, as applicable) of such Indebtedness, together with any other outstanding Indebtedness incurred pursuant to this clause (v), does not exceed $5.0 million;
(vi) the incurrence of intercompany Indebtedness between or among the Company and any of its Wholly Owned Restricted Subsidiaries; provided, that any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Wholly Owned Restricted Subsidiary of the Company or any sale or other transfer of any such Permitted Refinancing Indebtedness to a Person that is neither the Companyin exchange for, or a Wholly Owned Restricted Subsidiary the net proceeds of the Companywhich are used to refund, shall refinance or replace Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture to be deemed to constitute an incurrence incurred under Section 4.09(a) or clauses (ii), (iii), (iv), (v), or (viii) of such Indebtedness by the Company or such Restricted Subsidiary, as the case may bethis Section 4.09(b);
(viivi) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Debt in exchange for, or the net proceeds of which are used intercompany Indebtedness owing to extend, refinance, renew, replace, defease or refund Indebtedness that was permitted by this Indenture to be incurred;
(viii) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt; provided, that if, and to the extent any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company.
(ix) the incurrence held by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk with respect to any floating rate indebtedness that is permitted by the terms of this Indenture to be outstandingSubsidiaries; and
(x) the incurrence by the Company and its Restricted Subsidiaries of additional Indebtedness in an aggregate amount not to exceed $7.5 million at any time outstanding.provided, however, that:
Appears in 1 contract
Sources: Indenture (Spectrum Brands, Inc.)
Incurrence of Indebtedness and Issuance of Preferred Stock. The Company shall not, and shall not permit any of its Subsidiaries to, directly or indirectly, create, incur, issue, assume, guaranty or otherwise become directly or indirectly liable, contingently or otherwise, liable with respect to (collectively, "incur") any Indebtedness (including Acquired Debt)) and the Company shall not permit any of its Subsidiaries other than the Bank or any Subsidiary of the Bank to issue any shares of Preferred Stock; provided, however, that, so long as no Default or Event of Default has occurred and is continuing, that the Company and its Restricted Subsidiaries or any Subsidiary may incur Indebtedness (including Acquired Debt) if or any Subsidiary may issue Preferred Stock if, on the Fixed Charge Coverage Ratio for date of such incurrence and after giving effect thereto, the Company's most recently ended four full fiscal quarters for which financial statements are available immediately preceding the date on which such additional Indebtedness is incurred would have been at least Consolidated Leverage Ratio does not exceed 2.0 to 11.0, determined on or 1.5 to 1.0 in the case of any Indebtedness in a pro forma basis principal amount in excess of $75,000,000 (including a pro forma application of less any subordinated Indebtedness issued pursuant to the net proceeds therefrom), as if Recapitalization Agreement) which is subordinated to the additional Indebtedness had been incurred at the beginning of such four-quarter periodNotes. The foregoing provisions will shall not apply to:
(ia) Indebtedness of the Company and its Subsidiaries existing on the date of this Indenture;
(b) the incurrence by the Company and its Restricted Subsidiaries of Indebtedness pursuant to the Bank Credit Facility in an aggregate principal amount not to exceed $50.0 million at any one time outstanding less any Net Proceeds of Asset Sales applied to permanently reduce the Bank Credit Facility pursuant to the provisions described in Section 4.10;
(ii) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;
(iii) the incurrence by the Company and its Restricted Subsidiaries of Indebtedness represented by the Senior Notes, the Convertible Subordinated Notes Debt and the Guarantees thereof by up to $75,000,000 of Indebtedness (less any Restricted Subsidiaries subordinated Indebtedness issued pursuant to the provisions in Section 12.01 hereofRecapitalization Agreement) which is subordinated to the Notes and which matures after the Stated Maturity of the Notes;
(ivc) the incurrence of Permitted Warehouse Indebtedness by the Company or any of its Subsidiaries, and any Guarantee by the Company of such Indebtedness incurred by a Subsidiary, provided, however, that to the extent any such Indebtedness of the Company or a Subsidiary ceases to constitute Permitted Warehouse Indebtedness, such Indebtedness shall be deemed to be incurred at such time by the Company or such Subsidiary, as the case may be;
(d) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of the Company or such Restricted Subsidiary, in an aggregate principal amount not to exceed $5.0 million at any time outstanding;
(v) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness in connection with the acquisition of assets or a new Restricted Subsidiary; provided that such Indebtedness was incurred by the prior owner of such assets or such Restricted Subsidiary prior to such acquisition by the Company or one of its Restricted Subsidiaries and was not incurred in connection with, or in contemplation of, such acquisition by the Company or one of it Restricted Subsidiaries; and provided further that the principal amount (or accreted value, as applicable) of such Indebtedness, together with any other outstanding Indebtedness incurred pursuant to this clause (v), does not exceed $5.0 million;
(vi) the incurrence of intercompany Indebtedness between or among the Company and any of its Wholly Owned Restricted Subsidiaries; provided, that any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Wholly Owned Restricted Subsidiary of the Company or any sale or other transfer of any such Indebtedness to a Person that is neither the Company, or a Wholly Owned Restricted Subsidiary of the Company, shall be deemed to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be;
(vii) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Debt Indebtedness in exchange for, or the net proceeds of which are used to extend, refinance, renew, replace, defease or refund refund, Indebtedness that was permitted by this Indenture to be incurredincurred or that was outstanding at the date of this Indenture;
(viiie) the incurrence by the Company's Unrestricted Company or a Subsidiary of Hedging Obligations directly related to (i) Indebtedness of the Company or a Subsidiary incurred in conformity with the provisions of this Indenture, (ii) Receivables held by the Company or its Subsidiaries pending sale, (iii) Receivables of the Company or its Subsidiaries that have been sold, (iv) Receivables that the Company or a Subsidiary reasonably expects to purchase or commit to purchase, finance or accept as collateral, or (v) other assets owned or financed by the Company or its Subsidiaries in the ordinary course of business; provided, however, that, in the case of each of the foregoing clauses (i) through (v), such Hedging Obligations are eligible to receive hedge accounting treatment in accordance with GAAP as applied by the Company and its Subsidiaries on the date of this Indenture;
(f) Indebtedness of the Subsidiaries to the Company to the extent that such Indebtedness constitutes a Permitted Investment of the Company of the type permitted under the definition of Permitted Investments;
(g) the incurrence by the Company or any of its Subsidiaries of intercompany Indebtedness owing to the Company or any of its Subsidiaries; provided, however, that (i) any subsequent issuance or transfer of any Capital Stock which results in any such Indebtedness being held by a Person other than a Subsidiary and (ii) any sale or transfer of any such Indebtedness to a Person that is not either the Company or a Subsidiary shall be deemed, in each case, to constitute the incurrence of such Indebtedness by the Company or such Subsidiary, as the case may be;
(h) the incurrence by a Subsidiary of Non-Recourse Debt; provided, however, that if, and to the extent if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted the Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company.;
(ixi) the incurrence maintenance by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are Indebtedness incurred for to finance Receivables or repurchase facilities in the purpose ordinary course of fixing or hedging interest rate risk with respect to any floating rate indebtedness that is permitted by the terms of this Indenture to be outstandingbusiness; and
(xj) the incurrence by the Company and its Restricted Subsidiaries of additional Indebtedness in an aggregate principal amount which, together with the principal amount of all Indebtedness of the Company and its Subsidiaries outstanding on the date of incurrence (other than Indebtedness otherwise permitted by this Section 4.10), does not to exceed $7.5 million at any time outstanding25,000,000.
Appears in 1 contract
Incurrence of Indebtedness and Issuance of Preferred Stock. (a) The Company shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guaranty or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") Incur any Indebtedness (including Acquired Debt), and the Company shall not permit any of its Restricted Subsidiaries to issue any Preferred Stock (other than issuances to the Company or another Restricted Subsidiary); provided, however, that, so long as no Default or Event of Default has occurred and is continuing, that the Company and its Restricted Subsidiaries may incur Incur Indebtedness (including Acquired Debt) or any Guarantor may Incur Indebtedness or issue Preferred Stock, if the Fixed Charge Coverage Ratio for the Company's most recently ended four full fiscal quarters for which internal financial statements are available immediately preceding the date on which such additional Indebtedness is incurred Incurred or such Preferred Stock is issued would have been at least 2.0 to 1, determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the additional Indebtedness had been incurred Incurred or such Preferred Stock had been issued at the beginning of such four-quarter period. The foregoing provisions will .
(b) Section 4.09(a) shall not apply to:prohibit the Incurrence of any of the following items of Indebtedness (collectively, “Permitted Debt”):
(i) Indebtedness of the incurrence Company or any Guarantor under Credit Facilities in an aggregate principal amount at any one time outstanding pursuant to this Section 4.09(b)(i) not to exceed the greater of (x) $300.0 million less the aggregate amount of all Net Proceeds of Asset Sales applied by the Company or any Restricted Subsidiary to permanently repay any such Indebtedness (and, in the case of any revolving credit Indebtedness, to effect a corresponding commitment reduction thereunder) pursuant to Section 4.10 and (y) an amount equal to 2.5 times the Consolidated Cash Flow of the Company and its Restricted Subsidiaries for the most recently ended four full fiscal quarters for which internal financial statements are available immediately preceding the date on which such Indebtedness is to be Incurred (for purposes of Indebtedness pursuant making the computation referred to the Bank Credit Facility in an aggregate principal amount not to exceed $50.0 million at (y) above, (i) acquisitions and dispositions of business entities or property and assets constituting a division or line of business of any one time outstanding less any Net Proceeds of Asset Sales applied to permanently reduce the Bank Credit Facility pursuant to the provisions described in Section 4.10;
(ii) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;
(iii) the incurrence by the Company and its Restricted Subsidiaries of Indebtedness represented by the Senior Subordinated Notes and the Guarantees thereof by any Restricted Subsidiaries pursuant to the provisions in Section 12.01 hereof;
(iv) the incurrence Person that have been made by the Company or any of its Restricted Subsidiaries Subsidiaries, including through mergers or consolidations and including any related financing transactions, during such four-quarter period or subsequent to such period and on or prior to the date on which such Indebtedness is to be Incurred shall be given pro forma effect as if they had occurred on the first day of such four-quarter period and Consolidated Cash Flow for such period shall be calculated on a pro forma basis in accordance with Regulation S-X under the Securities Act, but without giving effect to clause (3) of the proviso set forth in the definition of Consolidated Net Income, and (ii) the Consolidated Cash Flow attributable to discontinued operations, as determined in accordance with GAAP, shall be excluded);
(ii) Existing Indebtedness;
(iii) Indebtedness of the Company and the Guarantors represented by the Notes and the related Note Guarantees to be issued on the Issue Date, and by the Exchange Notes and the related Note Guarantees to be issued pursuant to the Registration Rights Agreement in exchange therefor;
(iv) Indebtedness of the Company or any Restricted Subsidiary of the Company for Capital Lease Obligations, mortgage financings or purchase money obligations, in each case incurred case, Incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of the Company or such Restricted Subsidiary, in an aggregate principal amount amount, including all Permitted Refinancing Indebtedness Incurred to refund, refinance or replace any Indebtedness Incurred pursuant to this Section 4.09(b)(iv), not to exceed $5.0 25.0 million at any one time outstanding;
(v) Permitted Refinancing Indebtedness of the incurrence Company or any Restricted Subsidiary of the Company in exchange for, or the net proceeds of which are used to refund, refinance or replace, Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture to be Incurred under Section 4.09(a) or Section 4.09(b)(ii), (iii), (iv), (v) or (viii);
(vi) Indebtedness of the Company or any of its Restricted Subsidiaries owing to and held by the Company or any of its Restricted Subsidiaries of Indebtedness in connection with the acquisition of assets or a new Restricted Subsidiary; provided that such Indebtedness was incurred by the prior owner of such assets or such Restricted Subsidiary prior to such acquisition by the Company or one of its Restricted Subsidiaries and was not incurred in connection with, or in contemplation of, such acquisition by the Company or one of it Restricted Subsidiaries; and provided further that the principal amount (or accreted value, as applicable) of such Indebtedness, together with any other outstanding Indebtedness incurred pursuant to this clause (v), does not exceed $5.0 million;
(vi) the incurrence of intercompany Indebtedness between or among the Company and any of its Wholly Owned Restricted Subsidiaries; provided, however, that (i) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Wholly Owned Restricted Subsidiary of the Company or thereof and (ii) any sale or other transfer of any such Indebtedness to a Person that is neither not either the Company, Company or a Wholly Owned Restricted Subsidiary of the Companythereof, shall be deemed deemed, in each case, to constitute an incurrence Incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be, that was not permitted by this Section 4.09(b)(vi);
(vii) the incurrence Guarantees by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Debt in exchange for, or the net proceeds of which are used to extend, refinance, renew, replace, defease or refund Indebtedness that was permitted by this Indenture to be incurred;
(viii) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt; provided, that if, and to the extent any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence Guarantors of Indebtedness by of the Company or a Restricted Subsidiary of the Company.Company that was permitted to be Incurred by this Section 4.09; or
(ixviii) the incurrence by additional Indebtedness of the Company or any Restricted Subsidiary of its Restricted Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk with respect to any floating rate indebtedness that is permitted by the terms of this Indenture to be outstanding; and
(x) the incurrence by the Company and its Restricted Subsidiaries of additional Indebtedness in an aggregate amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness Incurred to refund, refinance or replace any Indebtedness Incurred pursuant to this Section 4.09(b)(viii), not to exceed $7.5 million 100.0 million. For purposes of determining compliance with this Section 4.09, in the event that any proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in Sections 4.09(b)(i) through (viii) above, or is entitled to be Incurred pursuant to Section 4.09(a), the Company shall be permitted to classify at the time of its Incurrence such item of Indebtedness in any manner that complies with this Section 4.09. In addition, any Indebtedness originally classified as Incurred pursuant to clauses (i) through (viii) above may later be reclassified by the Company such that it shall be deemed as having been Incurred pursuant to another of such clauses or pursuant to Section 4.09(a) to the extent that such reclassified Indebtedness could be Incurred pursuant to such other clause or Section 4.09(a) at the time outstandingof such reclassification. Notwithstanding the foregoing, Indebtedness under Credit Facilities outstanding on the Issue Date shall be deemed to have been Incurred on such date in reliance on the exception provided by 4.09(b)(i).
(c) For purposes of determining compliance with any U.S. dollar-denominated restriction on the Incurrence of Indebtedness, the U.S. Dollar Equivalent principal amount of Indebtedness denominated in a foreign currency shall be calculated based on the relevant currency exchange rate in effect on the date such Indebtedness was Incurred (or first committed, in the case of revolving credit Indebtedness); provided that if such Indebtedness is Incurred to refinance other Indebtedness denominated in a foreign currency, and such refinancing would cause the applicable U.S. dollar denominated restriction to be exceeded if calculated at the relevant currency exchange rate in effect on the date of such refinancing, such U.S. dollar-denominated restriction shall be deemed not to have been exceeded so long as the principal amount of such refinancing Indebtedness does not exceed the principal amount of such Indebtedness being refinanced. The principal amount of any Indebtedness Incurred to refinance other Indebtedness, if Incurred in a different currency from the Indebtedness being refinanced, shall be calculated based on the currency exchange rate applicable to the currencies in which such respective Indebtedness is denominated that is in effect on the date of such refinancing.
(d) The Company shall not Incur any Indebtedness that is subordinate or junior in right of payment to any other Indebtedness of the Company unless it is subordinate in right of payment to the Notes. No Guarantor shall Incur any Indebtedness that is subordinate or junior in right of payment to any other Indebtedness of such Guarantor unless it is subordinate in right of payment to such Guarantor's Note Guarantee. For purposes of the foregoing, no Indebtedness will be deemed to be subordinated in right of payment to any other Indebtedness of the Company or any Guarantor, as applicable, solely by reason of any Liens or Guarantees arising or created in respect of such other Indebtedness or by virtue of the fact that the holders of any secured Indebtedness have entered into intercreditor agreements giving one or more of such holders priority over the other holders in collateral held by them.
Appears in 1 contract
Sources: Indenture (Texas Industries Inc)
Incurrence of Indebtedness and Issuance of Preferred Stock. (a) The Company shall will not, and shall will not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guaranty or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") Incur any Indebtedness (including Acquired Debt); provided, however, that, so long as no Default or Event of Default has occurred and is continuing, that the Company and any of its Restricted Subsidiaries may incur Incur Indebtedness (including Acquired Debt) if the Fixed Charge Coverage Ratio of the Company and its Restricted Subsidiaries (on a consolidated basis) for the Company's ’s most recently ended four full fiscal quarters for which internal financial statements are available immediately preceding the date on which such additional Indebtedness is incurred Incurred would have been at least 2.0 to 11.0, determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the additional Indebtedness had been incurred Incurred at the beginning of such four-quarter period. .
(b) The foregoing provisions of Section 4.09(a) will not apply to:prohibit the Incurrence of any of the following items (collectively, “Permitted Debt”):
(i1) the incurrence Incurrence by the Company and its Restricted Subsidiaries any Guarantors of Indebtedness pursuant to the Bank Credit Facility under (and Guarantees in respect of) one or more Debt Facilities in an aggregate principal amount not to exceed $50.0 million at any one time outstanding less any Net Proceeds under this clause (1) not to exceed the greater of Asset Sales applied to permanently reduce the Bank Credit Facility pursuant to the provisions described in Section 4.10;
(i) $1,650.0 million and (ii) the incurrence sum of $500.0 million and 25.0% of the Company’s Consolidated Tangible Assets;
(2) the Incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;
(iii3) the incurrence Incurrence by the Company and its Restricted Subsidiaries the Guarantors of Indebtedness represented by the Senior Subordinated Notes and the related Note Guarantees thereof by (other than any Restricted Subsidiaries pursuant to the provisions in Section 12.01 hereofAdditional Notes and their related Guarantees);
(iv4) the incurrence Incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or financings, industrial revenue bonds, purchase money obligationsobligations or other Indebtedness, in each case incurred case, Incurred for the purpose of financing all or any part of the purchase price or cost of construction design, construction, installation or improvement of property, plant or equipment used in the business of the Company or any of its Restricted Subsidiaries, in each case whether through the direct purchase of such Restricted Subsidiaryassets or through the purchase of Equity Interests of any Person owning such assets, in an aggregate principal amount amount, including all Permitted Refinancing Indebtedness Incurred to renew, refund, refinance, replace, defease or discharge any Indebtedness Incurred pursuant to this clause (4), not to exceed the greater of (i) $5.0 300.0 million and (ii) 10.0% of the Company’s Consolidated Tangible Assets at any time outstanding;
(v5) the incurrence Incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in connection with exchange for, or the acquisition net proceeds of assets which are used to renew, refund, refinance, replace, defease or a new Restricted Subsidiary; provided discharge, in whole or in part, any Indebtedness (other than intercompany Indebtedness) that such Indebtedness was incurred permitted by this Indenture to be Incurred under Section 4.09(a) or clauses (2), (3), this clause (5) or (10) of this Section 4.09(b);
(6) the prior owner of such assets or such Restricted Subsidiary prior to such acquisition Incurrence by the Company or one any of its Restricted Subsidiaries and was not incurred in connection with, or in contemplation of, such acquisition by the Company or one of it Restricted Subsidiaries; and provided further that the principal amount (or accreted value, as applicable) of such Indebtedness, together with any other outstanding Indebtedness incurred pursuant to this clause (v), does not exceed $5.0 million;
(vi) the incurrence of intercompany Indebtedness between or among the Company and any of its Wholly Owned Restricted Subsidiaries; provided, that however, that:
(A) if the Company is the obligor on such Indebtedness and the payee is not a Guarantor, such Indebtedness must be unsecured and expressly subordinated to the prior payment in full in cash of all Obligations then due with respect to the Notes;
(B) if a Guarantor is the obligor on such Indebtedness and the payee is not the Company or a Guarantor, such Indebtedness must be unsecured and expressly subordinated to the prior payment in full in cash of all Obligations then due with respect to the Note Guarantee; and
(C) (i) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being beneficially held by a Person other than the Company or a Wholly Owned Restricted Subsidiary of the Company or (ii) any sale or other transfer of any such Indebtedness to a Person that is neither not either the Company, Company or a Wholly Owned Restricted Subsidiary of the CompanyCompany will be deemed, shall be deemed in each case, to constitute an incurrence Incurrence (as of the date of such issuance, sale or transfer) of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be, that was not permitted by this clause (6);
(vii7) the incurrence issuance by any of the Company’s Restricted Subsidiaries to the Company or to any of its Restricted Subsidiaries of Permitted Refinancing Debt in exchange for, or the net proceeds shares of which are used to extend, refinance, renew, replace, defease or refund Indebtedness that was permitted by this Indenture to be incurred;
(viii) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse DebtPreferred Stock; provided, however, that:
(A) any subsequent issuance or transfer of Equity Interests that if, and to the extent results in any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness Preferred Stock being held by a Person other than the Company or a Restricted Subsidiary of the Company.; and
(ixB) any sale or other transfer of any such Preferred Stock to a Person that is not either the incurrence Company or a Restricted Subsidiary of the Company, will be deemed, in each case, to constitute an issuance of such Preferred Stock by such Restricted Subsidiary that was not permitted by this clause (7);
(8) the Incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations in the ordinary course of business and not for speculative purposes;
(9) any Guarantee of Indebtedness of the Company or a Restricted Subsidiary to the extent that are incurred the guaranteed Indebtedness was permitted to be Incurred by another provision of this Section 4.09; provided that if the Indebtedness being guaranteed is subordinated or pari passu with the Notes, the Guarantee must be subordinated or pari passu, as applicable, to the same extent as the Indebtedness guaranteed;
(10) Permitted Acquisition Indebtedness;
(11) Indebtedness in respect of workers’ compensation claims, public liability insurance, unemployment insurance, property, casualty or liability insurance, self-insurance obligations or completion, performance, bid performance, appeal or surety bonds in the ordinary course of business, including Guarantees (not for the purpose of fixing borrowed money) or hedging interest rate risk obligations with respect to any floating rate indebtedness that is permitted letters of credit supporting such workers’ compensation claims, public liability insurance, unemployment insurance, property, casualty or liability insurance, self-insurance obligations or completion, performance, bid performance, appeal or surety bonds;
(12) the Incurrence by the terms Company or any of this Indenture to be outstandingits Restricted Subsidiaries of Indebtedness arising from the honoring by a bank or other financial institution of a check, draft or similar instrument drawn against insufficient funds in the ordinary course of business; provided, however, that such Indebtedness is extinguished within five Business Days of Incurrence;
(13) Indebtedness of the Company or any of its Restricted Subsidiaries consisting of the financing of insurance premiums;
(14) Indebtedness of the Company or any of its Restricted Subsidiaries in respect of Treasury Management Arrangements, Incurred in the ordinary course of business; and
(x15) the incurrence Incurrence by the Company and or any of its Restricted Subsidiaries of additional Indebtedness in an aggregate principal amount not to exceed $7.5 million at any time outstanding, including all Permitted Refinancing Indebtedness Incurred to renew, refund, refinance, replace, defease or discharge any Indebtedness Incurred pursuant to this clause (15), not to exceed the greater of (i) $150.0 million and (ii) 5.0% of the Company’s Consolidated Tangible Assets determined as of the date of such Incurrence.
(c) For purposes of determining compliance with this Section 4.09, in the event that an item of Indebtedness, Disqualified Stock or Preferred Stock meets the criteria of more than one of the categories of Permitted Debt described in clauses (1) through (15) of Section 4.09(b), or is entitled to be Incurred pursuant to Section 4.09(a), the Company will be permitted to divide and classify such item of Indebtedness, Disqualified Stock or Preferred Stock, as applicable, on the date of its Incurrence, or later re-divide and reclassify all or a portion of such item of Indebtedness, Disqualified Stock or Preferred Stock, as applicable, in any manner that complies with this Section 4.09. Indebtedness under Debt Facilities (including the Senior Credit Facilities, but excluding the Notes and the related Note Guarantees) outstanding on the Issue Date will be deemed to have been Incurred on such date in reliance on the exception provided by clause (1) of Section 4.09(b) and not Section 4.09(a) or the exception provided by clause (2) of Section 4.09(b), and may not later be reclassified.
(d) The accrual of interest or Preferred Stock dividends, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, the reclassification of Preferred Stock as Indebtedness due to a change in accounting principles, and the payment of dividends on Preferred Stock or Disqualified Stock in the form of additional shares of the same class of Preferred Stock or Disqualified Stock will not be deemed to be an Incurrence of Indebtedness or an issuance of Preferred Stock or Disqualified Stock for purposes of this Section 4.09; provided, in each such case, that the amount thereof is included in Fixed Charges of the Company as accrued.
(e) The reclassification of any lease or other liability of the Company or any of its Restricted Subsidiaries as Indebtedness due to a change of accounting principles after the Issue Date will not be deemed an Incurrence of Indebtedness for purposes of this Section 4.09.
(f) For purposes of determining any particular amount of Indebtedness under this Section 4.09, Guarantees or Liens supporting Indebtedness otherwise included in the determination of such particular amount shall not be included so long as incurred by a Person that could have Incurred such Indebtedness.
(g) For purposes of determining compliance with any U.S. dollar-denominated restriction on the Incurrence of Indebtedness, the U.S. dollar-equivalent principal amount of Indebtedness denominated in a foreign currency shall be utilized, calculated based on the relevant currency exchange rate in effect on the date such Indebtedness was Incurred, in the case of term Indebtedness, or first committed, in the case of revolving credit Indebtedness; provided that if such Indebtedness is Incurred to refinance other Indebtedness denominated in a foreign currency, and such refinancing would cause the applicable U.S. dollar-dominated restriction to be exceeded if calculated at the relevant currency exchange rate in effect on the date of such refinancing, such U.S. dollar-dominated restriction shall be deemed not to have been exceeded so long as the principal amount of such refinancing Indebtedness does not exceed the principal amount of such Indebtedness being refinanced. Notwithstanding any other provision of this covenant, the maximum amount of Indebtedness that the Company or any Restricted Subsidiary may Incur pursuant to this covenant shall not be deemed to be exceeded solely as a result of fluctuations in exchange rates or currency values. The principal amount of any Permitted Refinancing Indebtedness, if Incurred in a different currency from the Indebtedness being refinanced, shall be calculated based on the currency exchange rate applicable to the currencies in which such Permitted Refinancing Indebtedness is denominated that is in effect on the date of such refinancing.
Appears in 1 contract
Incurrence of Indebtedness and Issuance of Preferred Stock. (a) The Company shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guaranty or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") incur any Indebtedness (including Acquired Debt), and the Company shall not permit any of its Restricted Subsidiaries to issue any preferred stock; provided, however, that, so long as no Default or Event of Default has occurred and is continuing, that the Company and its or any Restricted Subsidiaries Subsidiary of the Company may incur Indebtedness (including Acquired Debt) Indebtedness, if the Fixed Charge Coverage Ratio for the Company's most recently ended four full fiscal quarters for which internal financial statements are available immediately preceding the date on which such additional Indebtedness is incurred would have been at least 2.0 to 1, determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the additional Indebtedness had been incurred at the beginning of such four-quarter period. The foregoing provisions will .
(b) So long as no Default shall have occurred and be continuing or would be caused thereby, Section 4.09(a) shall not apply to:prohibit the incurrence of any of the following items of Indebtedness (collectively, "Permitted Debt"):
(i) the incurrence by the Company and its or any Restricted Subsidiaries Subsidiary of the Company of Indebtedness pursuant to under Credit Facilities (and the Bank Credit Facility incurrence of Guarantees thereof) in an aggregate principal amount not to exceed $50.0 million at any one time outstanding pursuant to this clause (i) (with letters of credit being deemed to have a principal amount equal to the maximum potential liability of the Company and its Restricted Subsidiaries thereunder) not to exceed $1.6 billion, less any the aggregate amount of all Net Proceeds of Asset Sales applied by the Company or any Restricted Subsidiary to permanently reduce repay any such Indebtedness (and, in the Bank Credit Facility case of any revolving credit Indebtedness, to effect a corresponding commitment reduction thereunder) pursuant to the provisions described in Section 4.10;
(ii) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;
(iii) the incurrence by the Company and its Restricted Subsidiaries the Guarantors of Indebtedness represented by the Senior Subordinated Notes and the related Note Guarantees thereof by any Restricted Subsidiaries to be issued on the Issue Date and the Exchange Notes and the related Note Guarantees to be issued pursuant to the provisions in Section 12.01 hereofRegistration Rights Agreement;
(iv) the incurrence by the Company or any Restricted Subsidiary of its Restricted Subsidiaries the Company of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case case, incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of the Company or such Restricted Subsidiary, in an aggregate principal amount amount, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (iv), not to exceed $5.0 million exceed, at any time outstanding, the greater of (a) $50.0 million and (b) 10% of Consolidated Net Tangible Assets of the Company;
(v) the incurrence by the Company or any Restricted Subsidiary of the Company of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to refund, refinance or replace Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture to be incurred under Section 4.09(a) or clauses (ii) (other than the 9 7/8% Senior Subordinated Notes due 2009 of United incurred in connection with its acquisition by the Company), (iii), (iv), (v), or (viii) of this Section 4.09(b);
(vi) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness in connection with the acquisition of assets or a new Restricted Subsidiary; provided that such Indebtedness was incurred by the prior owner of such assets or such Restricted Subsidiary prior to such acquisition by the Company or one of its Restricted Subsidiaries and was not incurred in connection with, or in contemplation of, such acquisition by the Company or one of it Restricted Subsidiaries; and provided further that the principal amount (or accreted value, as applicable) of such Indebtedness, together with any other outstanding Indebtedness incurred pursuant to this clause (v), does not exceed $5.0 million;
(vi) the incurrence of intercompany Indebtedness between or among the Company owing to and any of its Wholly Owned Restricted Subsidiaries; provided, that any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Wholly Owned Restricted Subsidiary of the Company or any sale or other transfer of any such Indebtedness to a Person that is neither the Company, or a Wholly Owned Restricted Subsidiary of the Company, shall be deemed to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be;
(vii) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Debt in exchange for, or the net proceeds of which are used to extend, refinance, renew, replace, defease or refund Indebtedness that was permitted by this Indenture to be incurred;
(viii) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse DebtSubsidiaries; provided, that ifhowever, and to the extent any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company.
(ix) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk with respect to any floating rate indebtedness that is permitted by the terms of this Indenture to be outstanding; and
(x) the incurrence by the Company and its Restricted Subsidiaries of additional Indebtedness in an aggregate amount not to exceed $7.5 million at any time outstanding.that:
Appears in 1 contract
Sources: Indenture (Rayovac Corp)
Incurrence of Indebtedness and Issuance of Preferred Stock. The Company shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guaranty guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") any Indebtedness (including Acquired Debt)) and that the Company shall not issue any Disqualified Stock and shall not permit any of its Restricted Subsidiaries to issue any shares of preferred stock; provided, however, that, so long as no Default or Event of Default has occurred and is continuing, that the Company and its Restricted Subsidiaries may incur Indebtedness (including Acquired Debt) or issue shares of Disqualified Stock and any of the Company's Restricted Subsidiaries may incur Indebtedness if the Company's Fixed Charge Coverage Ratio for the Company's most recently ended four full fiscal quarters for which internal financial statements are available immediately preceding the date on which such additional Indebtedness is incurred or such Disqualified Stock is issued would have been at least 2.0 2.00 to 1, determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the additional Indebtedness had been incurred incurred, or the Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period. The foregoing provisions will of the first paragraph of this Section 4.09 shall not apply to:to the incurrence of any of the following items of Indebtedness (collectively, "Permitted Debt"):
(i) the incurrence by the Company or its Restricted Subsidiaries of term Indebtedness under the Credit Facility, letters of credit (with letters of credit being deemed to have a principal amount equal to the maximum potential liability of the Company and its Restricted Subsidiaries of Indebtedness pursuant to thereunder) and related Guarantees under the Bank Credit Facility in an Facility; provided that the aggregate principal amount of all term Indebtedness and letters of credit of the Company and its Restricted Subsidiaries (with letters of credit being deemed to have a principal amount equal to the maximum potential liability of the Company and its Restricted Subsidiaries thereunder) outstanding under the Credit Facility after giving effect to such incurrence, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any other Indebtedness incurred pursuant to this clause (i) does not exceed an amount equal to $550.0 million;
(ii) the incurrence by the Company or its Restricted Subsidiaries of revolving credit Indebtedness under the Credit Facility, letters of credit (with letters of credit being deemed to have a principal amount equal to the maximum potential liability of the Company and its Restricted Subsidiaries thereunder) and related Guarantees under the Credit Facility; provided that the aggregate principal amount of all revolving Indebtedness and letters of credit of the Company and its Restricted Subsidiaries (with letters of credit being deemed to have a principal amount equal to the maximum potential liability of the Company and its Restricted Subsidiaries thereunder) outstanding under the Credit Facility after giving effect to such incurrence, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any other Indebtedness incurred pursuant to this clause (ii), does not exceed $50.0 700.0 million at any one time outstanding less any Net Proceeds the aggregate amount of Asset Sales Sale proceeds applied by the Company and its Restricted Subsidiaries to permanently reduce the Bank availability of revolving credit Indebtedness under the Credit Facility Agreements pursuant to the provisions described in of Section 4.104.10 hereof;
(iiiii) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;
(iiiiv) the incurrence by the Company and its Restricted Subsidiaries the Guarantors of Indebtedness represented by the Senior Notes, the Senior Subordinated Notes Notes, the Senior Subsidiary Guarantees and the Subordinated Subsidiary Guarantees thereof by any Restricted Subsidiaries pursuant limited in aggregate principal amount, without duplication, to amounts outstanding under this Senior Note Indenture and the provisions in Section 12.01 hereofSenior Subordinated Note Indenture as of their respective dates;
(ivv) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of the Company or such Restricted Subsidiary, in an aggregate principal amount amount, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace Indebtedness incurred pursuant to this clause (v), not to exceed $5.0 million at any time outstanding5% of Total Assets;
(vvi) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness in connection with Permitted Refinancing Indebtedness;
(vii) the acquisition of assets or a new Restricted Subsidiary; provided that such Indebtedness was incurred by the prior owner of such assets or such Restricted Subsidiary prior to such acquisition incurrence by the Company or one any of its Restricted Subsidiaries and was not incurred in connection with, or in contemplation of, such acquisition by the Company or one of it Restricted Subsidiaries; and provided further that the principal amount (or accreted value, as applicable) of such Indebtedness, together with any other outstanding Indebtedness incurred pursuant to this clause (v), does not exceed $5.0 million;
(vi) the incurrence of intercompany Indebtedness between or among the Company and any of its Wholly Owned Restricted Subsidiaries; provided, however, that (i) if the Company is the obligor on such Indebtedness, such Indebtedness is expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Senior Note and this Senior Note Indenture, (ii) if a Restricted Subsidiary of the Company is the obligor on such Indebtedness, such Indebtedness is expressly subordinated to the prior payment in full in cash of such Restricted Subsidiary's Senior Subsidiary Guarantee and (iii)(A) any subsequent event or issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Wholly Owned Restricted Subsidiary of the Company or and (B) any sale or other transfer of any such Indebtedness to a Person that is neither not either the Company, Company or a Wholly Owned Restricted Subsidiary of the Company, Company shall be deemed deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be;
(vii) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Debt in exchange for, or the net proceeds of which are used to extend, refinance, renew, replace, defease or refund Indebtedness that was not permitted by this Indenture to be incurredclause (vii);
(viii) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt; provided, that if, and to the extent any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company.
(ix) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are incurred in the normal course of business for the purpose of fixing or hedging currency, commodity or interest rate risk (including with respect to any floating rate indebtedness Indebtedness that is permitted by the terms of this Senior Note Indenture to be outstanding; andoutstanding in connection with the conduct of their respective businesses and not for speculative purposes);
(ix) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness in the ordinary course of business solely in respect of performance, surety and similar bonds, completion or performance guarantees or standby letters of credit issued for the purpose of supporting workers' compensation liabilities of the Company or any of its Restricted Subsidiaries, to the extent that such incurrence does not result in the incurrence of any obligation for the payment of borrowed money to others;
(x) the incurrence of Indebtedness arising from agreements of the Company or a Restricted Subsidiary providing for indemnification, adjustment of purchase price or similar obligations, in each case, incurred or assumed in connection with the disposition of any business, assets or a Subsidiary;
(xi) the incurrence by a Restricted Subsidiary of the Company of Indebtedness in connection with and in contemplation of, the concurrent disposition of such Restricted Subsidiary to the stockholders of the Company; provided that such disposition occurs concurrently with such incurrence and following such disposition, neither the Company nor any of its Restricted Subsidiaries has any liability with respect to such Indebtedness;
(xii) the incurrence by a Securitization Entity of Indebtedness in a Qualified Securitization Transaction that is Non-Recourse Debt with respect to the Company and its other Restricted Subsidiaries (except for Standard Securitization Undertakings and Limited Originator Recourse);
(xiii) the guarantee by the Company and or any of the Restricted Subsidiaries of Indebtedness of the Company or a Restricted Subsidiary of the Company that was permitted to be incurred by another provision of this Section 4.09; and
(xiv) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any other Indebtedness incurred pursuant to this clause (xiv), not to exceed $7.5 million at 75.0 million. For purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (i) through (xiv) above as of the date of incurrence thereof or is entitled to be incurred pursuant to the first paragraph of this Section 4.09 as of the date of incurrence thereof, the Company shall, in its sole discretion, classify or reclassify such item of Indebtedness as of the date of incurrence thereof in any time outstandingmanner that complies with this Section 4.09 and such item of Indebtedness shall be treated as having been incurred pursuant to only one of such clauses or pursuant to the first paragraph of this Section 4.09. Accrual of interest, the accretion of accreted value and the payment of interest in the form of additional Indebtedness will not be deemed to be an incurrence of Indebtedness for purposes of this Section 4.09.
Appears in 1 contract
Sources: Senior Note Indenture (Ball Corp)
Incurrence of Indebtedness and Issuance of Preferred Stock. The Company shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guaranty guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") any Indebtedness (including Acquired Debt)) and the Company shall not permit any of its Restricted Subsidiaries to issue any shares of preferred stock; provided, however, that, that so long as no Default or Event of Default has occurred and or is continuing, the Company and its Restricted Subsidiaries of the Company may incur Indebtedness (including Acquired Debt) if the Fixed Charge Coverage Ratio for the Company's such Restricted Subsidiaries' most recently ended four full fiscal quarters for which internal financial statements are available immediately preceding the date on which such additional Indebtedness is incurred would have been at least 2.0 to 1, determined on a pro forma and consolidated basis (including a pro forma application of the net proceeds therefrom), as if the additional Indebtedness had been incurred at the beginning of such four-quarter period. Compliance by the Company and its Restricted Subsidiaries with the Fixed Charge Coverage Test set forth in the first paragraph of this Section 4.09 hereof shall be determined on a consolidated basis for all Restricted Subsidiaries of the Company taken as a whole regardless of whether the Indebtedness is to be incurred by less than all such Restricted Subsidiaries. The foregoing provisions will of the first paragraph of this covenant shall not apply to:to the incurrence of any of the following items of Indebtedness (collectively, "Permitted Debt"):
(i) the incurrence by the Company and its Restricted Subsidiaries of the Company of Indebtedness pursuant to the Bank under Credit Facility Facilities in an aggregate principal amount not to exceed the greater of (x) 65% of inventory plus 85% of accounts receivable of the Company and its Wholly Owned Subsidiaries (in each case as determined in accordance with GAAP, but excluding accounts receivable that are past due more than 60 days), and (y) $50.0 215.0 million at any one time outstanding outstanding, less any Net Proceeds of Asset Sales applied to permanently reduce the Bank Credit Facility any such Indebtedness pursuant to the provisions described in Section 4.104.10 hereof;
(ii) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;
(iii) the incurrence by Lily Cup of Indebtedness under Credit Facilities not to exceed the greater of (x) 65% of inventory plus 85% of accounts receivables plus 75% of the fair market value of the plant, property and equipment of Lily Cup (as determined in accordance with GAAP), and (y) Cn $30.0 million at any time outstanding and that is without recourse to the Company and or any of its Restricted Subsidiaries or any of Indebtedness represented by the Senior Subordinated Notes their respective assets (other than Lily Cup and the Guarantees thereof its assets) and is not guaranteed by any Restricted Subsidiaries pursuant to the provisions in Section 12.01 hereofsuch Person;
(iv) the incurrence by the Company or of Indebtedness represented by the Company's Guarantee of the Obligations evidenced by the Notes and the Company Guarantee Documents;
(v) the incurrence by any of its the Restricted Subsidiaries of the Company of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of the Company or such Restricted Subsidiary, in an aggregate principal amount not to exceed $5.0 million at any time outstanding;
(vvi) the incurrence by any of the Restricted Subsidiaries of the Company or any of its Restricted Subsidiaries of Indebtedness in connection with the acquisition of assets or a new Restricted Subsidiary; provided that such Indebtedness was incurred by the prior owner of such assets or such Restricted Subsidiary prior to such acquisition by one of the Restricted Subsidiaries of the Company or one of its Restricted Subsidiaries and was not incurred in connection with, or in contemplation of, such acquisition by the Company or one of it the Restricted SubsidiariesSubsidiaries of the Company; and provided further that the principal amount (or accreted value, as applicable) of such Indebtedness, together with any other outstanding Indebtedness incurred pursuant to this clause (vvi) and any Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (vi), does not exceed $5.0 million;
(vivii) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to refund, refinance or replace Indebtedness (other than intercompany Indebtedness) that was permitted by this Agreement to be incurred under the first paragraph hereof or clauses (ii), (iv), (v) or (vi) of this paragraph;
(viii) the incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness between or among the Company and any of its Wholly Owned Restricted SubsidiariesSubsidiaries (other than any Indebtedness of the Company or any of its Restricted Subsidiaries owing to Lily Cup), in each case subject to no Lien held by any Person other than the Company or a Restricted Subsidiary (other than Liens securing intercompany notes pledged under documents governing Indebtedness incurred pursuant to clause (i) above or under the Pledge Agreement); provided, however, that (a) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Wholly Owned Restricted Subsidiary of the Company or thereof and (b) any sale or other transfer of any such Indebtedness to a Person that is neither not either the Company, Company or a Wholly Owned Restricted Subsidiary of the Company, thereof shall be deemed deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be;
(vii) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Debt in exchange for, or the net proceeds of which are used to extend, refinance, renew, replace, defease or refund Indebtedness that was not permitted by this Indenture to be incurred;
clause (viii) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt); provided, further, however that if, and any Indebtedness of the Company to the extent any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company is unsecured and subordinated, pursuant to a written agreement, to the Company.'s Obligations under this Agreement and the Notes;
(ix) the incurrence by any of the Restricted Subsidiaries of the Company or any of its Restricted Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk with respect to of any floating rate indebtedness Indebtedness that is permitted by the terms of this Indenture Agreement to be outstanding; and;
(x) the incurrence by the Company and its Global Cup Entities of Indebtedness under Credit Facilities in an aggregate principal amount not to exceed 65% of inventory plus 85% of accounts receivable of the Global Cup Entities (as determined in accordance with GAAP);
(xi) the incurrence by any of the Restricted Subsidiaries of the Company of Indebtedness which is recourse solely to newly acquired property financed with the incurrence of such Indebtedness in an aggregate principal amount not to exceed $20.0 million at any time outstanding; and
(xii) the incurrence by any of the Restricted Subsidiaries of the Company of additional Indebtedness in an aggregate principal amount (or accreted value, as applicable) not to exceed $7.5 25.0 million at any one time outstanding. For purposes of determining compliance with this covenant, in the event that an item of Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (i) through (x) above or is entitled to be incurred pursuant to the first paragraph of this covenant, the Company shall, in its sole discretion, classify such item of Indebtedness in any manner that complies with this covenant. Accrual of interest, accretion or amortization of original issue discount, and the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms shall not be deemed to be an incurrence of Indebtedness for purposes of this Section 4.09; provided, in each such case, that the amount thereof is included in Fixed Charges of the Company as accrued.
Appears in 1 contract
Incurrence of Indebtedness and Issuance of Preferred Stock. The Company shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guaranty guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") any Indebtedness (including Acquired Debt); provided) and the Company shall not issue any Disqualified Stock and shall not permit any of its Restricted Subsidiaries to issue any shares of Disqualified Stock or Preferred Stock, howeverprovided that the Company or any of its Restricted Subsidiaries may incur Indebtedness, thatthe Company may issue Disqualified Stock and subject to the final paragraph of this covenant below, so long as no Default or Event Restricted Subsidiaries of Default has occurred and is continuing, the Company may incur Preferred Stock if the Leverage Ratio of the Company and its Restricted Subsidiaries may incur Indebtedness (including Acquired Debt) if the Fixed Charge Coverage Ratio for the Company's most recently ended four full fiscal quarters for which financial statements are available immediately preceding the date on which such additional Indebtedness is incurred would have been at least 2.0 not greater than 4.5 to 1, 1.0 determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the additional Indebtedness had been incurred incurred, or the Disqualified Stock or Preferred Stock had been issued, as the case may be, at the beginning of such four-quarter periodthe most recently ended fiscal quarter. The foregoing provisions will So long as no Default shall have occurred and be continuing or would be caused thereby, the first paragraph of this covenant shall not apply to:prohibit the incurrence of any of the following items of Indebtedness (collectively, "Permitted Debt"):
(i1) the incurrence by the Company and its Restricted Subsidiaries of Indebtedness pursuant to under the Bank Credit Facility in an Facilities; provided that the aggregate principal amount of all Indebtedness of the Company and its Restricted Subsidiaries outstanding under this clause (1) for all Credit Facilities of the Company and its Restricted Subsidiaries after giving effect to such incurrence does not exceed an amount equal to exceed $50.0 million at any one time outstanding 9.75 billion less any the aggregate amount of all Net Proceeds of from Asset Sales applied by the Company or any of its Restricted Subsidiaries to permanently reduce the Bank repay Indebtedness under a Credit Facility pursuant to the provisions described in Section 4.10;4.11.
(ii2) the incurrence by the Company and its Restricted Subsidiaries of Existing Indebtedness (other than under the Existing IndebtednessCredit Facilities);
(iii3) the incurrence on the Issue Date by the Company and its Restricted Subsidiaries of Indebtedness represented by the Senior Subordinated Notes and the Guarantees thereof by (other than any Restricted Subsidiaries pursuant to the provisions in Section 12.01 hereofAdditional Notes);
(iv4) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case case, incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement (including, without limitation, the cost of propertydesign, plant or equipment used in the business development, construction, acquisition, transportation, installation, improvement, and migration) of Productive Assets of the Company or such any of its Restricted SubsidiarySubsidiaries, in an aggregate principal amount not to exceed $5.0 75 million at any time outstandingoutstanding pursuant to this clause (4);
(v5) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in connection with exchange for, or the acquisition net proceeds of assets which are used to refund, refinance or a new Restricted Subsidiary; provided replace, in whole or in part, Indebtedness (other than intercompany Indebtedness) that such Indebtedness was permitted by this Indenture to be incurred by under this clause (5), the prior owner first paragraph of such assets this covenant or such Restricted Subsidiary prior to such acquisition clauses (2) or (3) of this paragraph;
(6) the incurrence by the Company or one any of its Restricted Subsidiaries and was not incurred in connection with, or in contemplation of, such acquisition by the Company or one of it Restricted Subsidiaries; and provided further that the principal amount (or accreted value, as applicable) of such Indebtedness, together with any other outstanding Indebtedness incurred pursuant to this clause (v), does not exceed $5.0 million;
(vi) the incurrence of intercompany Indebtedness between or among the Company and any of its Wholly Owned Restricted Subsidiaries; providedprovided that:
(a) if the Company is the obligor on such Indebtedness, that such Indebtedness must be expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes; and
(i) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Wholly Owned Restricted Subsidiary of the Company or thereof and (ii) any sale or other transfer of any such Indebtedness to a Person that is neither not either the Company, Company or a Wholly Owned Restricted Subsidiary of the Companythereof, shall be deemed deemed, in each case, to constitute an incurrence of such Indebtedness that was not permitted by the Company or such Restricted Subsidiary, as the case may bethis clause (6);
(vii) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Debt in exchange for, or the net proceeds of which are used to extend, refinance, renew, replace, defease or refund Indebtedness that was permitted by this Indenture to be incurred;
(viii) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt; provided, that if, and to the extent any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company.
(ix7) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk with respect to any floating rate indebtedness Indebtedness that is permitted by the terms of this Indenture to be outstanding; and;
(x8) the guarantee by the Company or any of its Restricted Subsidiaries of Indebtedness of a Restricted Subsidiary of the Company that was permitted to be incurred by another provision of this Section 4.10;
(9) the incurrence by the Company and or any of its Restricted Subsidiaries of additional Indebtedness in an aggregate principal amount at any time outstanding under this clause (9), not to exceed $7.5 million at 300 million; and
(10) the accretion or amortization of original issue discount and the write up of Indebtedness in accordance with purchase accounting.
(a) meets the criteria of more than one of the categories of Permitted Debt described in clauses (1) through (10) above or (b) is entitled to be incurred pursuant to the first paragraph of this covenant, the Company shall be permitted to classify and from time to time to reclassify such item of Indebtedness in any time outstandingmanner that complies with this covenant. Once any item of Indebtedness is so reclassified, it shall no longer be deemed outstanding under the category of Permitted Debt, where initially incurred or previously reclassified. For avoidance of doubt, Indebtedness incurred pursuant to a single agreement, instrument, program, facility or line of credit may be classified as Indebtedness arising in part under one of the clauses listed above or under the first paragraph of this covenant, and in part under any one or more of the clauses listed above, to the extent that such Indebtedness satisfies the criteria for such classification.
Appears in 1 contract
Incurrence of Indebtedness and Issuance of Preferred Stock. The Company shall not, and shall not permit any of its the Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guaranty guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") after the Issue Date any Indebtedness (including Acquired Debt)) and the Company shall not permit any of the Restricted Subsidiaries to issue any shares of preferred stock; provided, however, that, so long as no Default or Event of Default has occurred and is continuing, that the Company and its the Restricted Subsidiaries may incur Indebtedness (including Acquired Debt) or issue preferred stock if the Fixed Charge Coverage Ratio for the Company's most recently ended four full fiscal quarters for which financial statements are available Reference Period immediately preceding the date on which such additional Indebtedness is incurred would have been at least 2.0 to 1, in each case determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the additional Indebtedness had been incurred at the beginning of such four-quarter periodReference Period. Indebtedness consisting of reimbursement obligations in respect of a letter of credit shall be deemed to be incurred when the letter of credit is first issued. The foregoing provisions will do not apply to:
(i) the incurrence by the Company and its Restricted Subsidiaries of Indebtedness pursuant to the Bank Credit Facility in an aggregate principal amount not to exceed $50.0 million at any one time outstanding less any Net Proceeds of Asset Sales applied to permanently reduce the Bank Credit Facility pursuant to the provisions described in Section 4.10;
(ii) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;
(iii) the incurrence by the Company and its Restricted Subsidiaries of Indebtedness represented by the Senior Subordinated Notes and the Guarantees thereof by any Restricted Subsidiaries pursuant to the provisions in Section 12.01 hereof;
(iv1) the incurrence by the Company or any of its the Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings under any one or purchase money obligations, in each case incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of the Company or such Restricted Subsidiary, more Credit Facilities in an aggregate principal amount at any one time outstanding (with letters of credit being deemed to have a principal amount equal to the Company's or any of the Restricted 42 Subsidiaries' maximum stated reimbursement obligation with respect thereto) pursuant to this clause (1) not to exceed $5.0 million at any time outstanding350,000,000;
(v2) the incurrence by the Company and the Guarantors of Indebtedness represented by the Notes offered on the Issue Date and the related Exchange Notes and any guarantees thereof;
(3) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness in connection with the acquisition of assets or a new Restricted Subsidiary; provided that such Indebtedness was incurred by the prior owner of such assets or such Restricted Subsidiary prior to such acquisition by the Company or one of its Restricted Subsidiaries and was not incurred in connection with, or in contemplation of, such acquisition by the Company or one of it Restricted Subsidiaries; and provided further that the principal amount (or accreted value, as applicable) of such Indebtedness, together with any other outstanding Indebtedness incurred pursuant to this clause (v), does not exceed $5.0 million;
(vi) the incurrence of intercompany Indebtedness between or among the Company and any of its Wholly Owned Restricted Subsidiaries; provided, that any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Wholly Owned Restricted Subsidiary of the Company or any sale or other transfer of any such Indebtedness to a Person that is neither the Company, or a Wholly Owned Restricted Subsidiary of the Company, shall be deemed to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be;
(vii) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Debt Indebtedness in exchange for, or the net proceeds of which are used to extend, refinance, renew, replace, defease or refund refund, Indebtedness that was permitted by this Indenture to be incurredincurred (including, without limitation, Existing Indebtedness);
(viii) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt; provided, that if, and to the extent any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company.
(ix4) the incurrence by the Company or any of its the Restricted Subsidiaries of intercompany Indebtedness between or among the Company and any of the Restricted Subsidiaries; provided that any subsequent issue or transfer of Capital Stock or other event that results in such Restricted Subsidiary ceasing to be a Restricted Subsidiary or any subsequent transfer of any such Indebtedness (except to the Company or a Restricted Subsidiary shall be deemed, in each case, to constitute the incurrence of such Indebtedness by the issuer thereof not permitted by this clause (4));
(5) the incurrence by the Company or any of the Restricted Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate or currency risk with respect to any fixed or floating rate indebtedness Indebtedness that is permitted by the terms of this Indenture to be outstandingoutstanding or any receivable or liability the payment of which is determined by reference to a foreign currency; andprovided that the notional principal amount of any such Hedging Obligation does not exceed the principal amount of the Indebtedness or the amount of such receivable or liability to which such Hedging Obligation relates;
(x6) the incurrence by the Company and its or any of the Restricted Subsidiaries of additional Indebtedness represented by performance bonds, warranty or contractual service obligations, standby letters of credit or appeal bonds, in each case to the extent incurred in the ordinary course of business of the Company or the Restricted Subsidiary;
(7) the incurrence by Receivables Subsidiaries of Indebtedness not to exceed $125,000,000 in the aggregate at any time outstanding;
(8) the incurrence by the Company or any Guarantor of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations (including borrowings under a Credit Facility), in each case, incurred for the purpose of financing or refinancing all or any part of the purchase price or cost of construction, development, maintenance, upgrade or improvement of property, plant, equipment or assets (in each case whether through the direct purchase of assets or through the purchase of Capital Stock of the Person owning such assets) used in the Company's business or the business of such Guarantor, in an aggregate principal amount, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (8), not to exceed, at any time outstanding the greater of (a) $70,000,000 and (b) 5% of Total Assets;
(9) the Company's or any of the Restricted Subsidiaries' Indebtedness arising from the honoring by a bank or other financial institution of a check, draft or similar instrument inadvertently (except in the case of daylight overdrafts) drawn against insufficient funds in the ordinary course of business, provided that such Indebtedness is satisfied within five Business Days;
(10) the guarantee by the Company or any Guarantor of the Company's Indebtedness or Indebtedness of a Guarantor that was permitted to be incurred by another provision of this Section 4.09;
(11) contingent liabilities arising out of endorsements of checks and other negotiable instruments for deposit collection or overdraft protection in the ordinary course of business;
(12) Indebtedness arising from guarantees of Obligations of Permitted Joint Ventures of the Company or any of the Restricted Subsidiaries in an aggregate principal amount not to exceed $7.5 million 10,000,000 at any one time;
(13) the incurrence by the Company or any of the Restricted Subsidiaries of Indebtedness (in addition to Indebtedness permitted by any other clause of this paragraph) in an aggregate principal amount at any time outstandingoutstanding not to exceed $125,000,000; and
(14) the Company's and the Restricted Subsidiaries' obligations arising from the Company's or the Restricted Subsidiaries' agreements providing for indemnification, adjustment of purchase price or similar obligations, in each case incurred or assumed in connection with the disposition of any business, assets or any of the Company's Subsidiaries in accordance with the terms of this Indenture, other than Guarantees by the Company or any of the Restricted Subsidiaries of Indebtedness incurred by any Person acquiring all or any portion of such business, assets or any of the Company's Subsidiaries for the purpose of financing such acquisition; provided, however, that the maximum aggregate liability in respect of all such obligations shall not exceed the gross proceeds, including the fair market value of non-cash proceeds (the fair market value of such non-cash proceeds being measured at the time it is received and without giving effect to any subsequent changes in value), actually received by the Company and the Restricted Subsidiaries in connection with such disposition. For purposes of determining any particular amount of Indebtedness under this Section 4.09, guarantees, Liens or obligations with respect to letters of credit supporting Indebtedness otherwise included in the determination of such particular amount shall not be included. For purposes of determining compliance with this Section 4.09,
(1) in the event that an item of Indebtedness meets the criteria of more than one of the types of Indebtedness permitted by the second paragraph of this Section 4.09, the Company may in its sole discretion, (x) divide and classify such item of Indebtedness on the date of incurrence thereof, or (y) later classify, reclassify or divide all or a portion of such item of Indebtedness in any manner that complies with this Section 4.09;
(2) the outstanding principal amount on any date of any Indebtedness issued with original issue discount is the face amount of such Indebtedness less the remaining unamortized portion of the original issue discount of such Indebtedness on such date;
(3) the payment of dividends on Redeemable Capital Stock in the form of additional shares of the same class of Redeemable Capital Stock shall not be deemed an issuance of Redeemable Capital Stock;
(4) the maximum amount of Indebtedness that the Company or any Restricted Subsidiary may incur pursuant to the covenant shall not be deemed to be exceeded as a result of fluctuation in the exchange rates of currencies;
(5) in connection with any Receivables Financing, the outstanding principal amount of Indebtedness shall be the Securitization Financing Amount; and
(6) the outstanding principal amount of Indebtedness with respect to Redeemable Capital Stock shall be measured as the greater of the voluntary or involuntary maximum fixed repurchase price or liquidation value on the date of determination, but excluding any accrued dividends for any current period that are not yet payable. The accrual of interest, the accretion or amortization of original issue discount, the payment of interest and dividends on any Indebtedness in the form of additional Indebtedness with the same terms, and the payment or accrual of dividends on Redeemable Stock or preferred stock in the form of additional shares of the same class of 44 Redeemable Stock or preferred stock shall not be deemed to be an incurrence of Indebtedness or an issuance of Redeemable Stock or preferred stock for purposes of this Section 4.09. Indebtedness outstanding under the Credit Agreement on the Issue Date shall be deemed to be incurred under the first paragraph of this Section 4.09.
Appears in 1 contract
Sources: Indenture (Beverly Enterprises Inc)
Incurrence of Indebtedness and Issuance of Preferred Stock. The Company shall not, and shall not permit any of its Subsidiaries to, directly or indirectly, create, incur, issue, assume, guaranty guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") any Indebtedness (including Acquired Debt)) and the Company shall not issue any Disqualified Stock and shall not permit any of its Subsidiaries to issue any shares of preferred stock; provided, however, that, so long as no Default or Event of Default has occurred and is continuing, that the Company may incur Indebtedness (including Acquired Debt) or issue shares of Disqualified Stock or preferred stock and its the Company's Restricted Subsidiaries may incur Indebtedness (including Acquired Debt) and issue Disqualified Stock or preferred stock if the Fixed Charge Coverage Ratio for the Company's most recently ended four full fiscal quarters for which internal financial statements are available immediately preceding the date on which such additional Indebtedness is incurred or such Disqualified Stock is issued would have been at least 2.0 to 1, if such incurrence or issuance is on or prior to the second anniversary of the Issue Date, or 2.25 to 1 if such incurrence or issuance is after the second anniversary of the Issue Date but on or prior to the fourth anniversary of the Issue Date, or 2.5 to 1 if such incurrence or issuance is after the fourth anniversary of the Issue Date, in each case, determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the additional Indebtedness had been incurred incurred, or the Disqualified Stock or preferred stock had been issued, as the case may be, at the beginning of such four-quarter period. The foregoing provisions will first paragraph of Section 4.09 shall not apply to:prohibit the incurrence of any of the following items of Indebtedness (collectively, "Permitted Debt"):
(i) the incurrence by the Company and or any of its Restricted Subsidiaries of Indebtedness and letters of credit pursuant to the Bank Senior Credit Facility Facilities; provided that the aggregate amount of all Indebtedness then classified as having been incurred in reliance upon this clause (i) that remains outstanding under the Senior Credit Facilities after giving effect to such incurrence does not exceed an aggregate principal amount not equal to exceed $50.0 million at any one time outstanding less any Net Proceeds of Asset Sales applied to permanently reduce the Bank Credit Facility pursuant to the provisions described in Section 4.10190 million;
(ii) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;
(iii) the incurrence by the Company and its Restricted Subsidiaries the Guarantors of Indebtedness represented by the Senior Subordinated Notes originally issued on the Issue Date and the Guarantees thereof by any Restricted Subsidiaries pursuant to the provisions in Section 12.01 hereofSubsidiary Guarantees;
(iv) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of the Company or such Restricted SubsidiarySubsidiary (whether through the direct purchase of assets or the Capital Stock of any Person owning such Assets), in an aggregate principal amount or accreted value, as applicable, not to exceed $5.0 million at any time outstanding15.0 million;
(v) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness in connection with the acquisition of assets or a new Restricted Subsidiary; provided that such Indebtedness was incurred by the prior owner of such assets or such Restricted Subsidiary prior to such acquisition by the Company or one of its Restricted Subsidiaries and was not incurred in connection with, or in contemplation of, such acquisition by the Company or one of it Restricted its Subsidiaries; and provided further that the principal amount (or accreted value, as applicable) of such Indebtedness, together with any other outstanding Indebtedness incurred pursuant to this clause (v), does not exceed $5.0 20.0 million;
(vi) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to refund, refinance or replace Indebtedness that was permitted by this Indenture to be incurred;
(vii) the incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness between or among the Company and any of its Wholly Owned Restricted Subsidiaries; provided, however, that (i) if the Company or any Guarantor is the obligor on such Indebtedness, such Indebtedness must be expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, in the case of the Company, or the Subsidiary Guarantee of such Guarantor, in the case of a Guarantor; and (ii)(A) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Wholly Owned Restricted Subsidiary of the Company or and (B) any sale or other transfer of any such Indebtedness to a Person that is neither not either the Company, Company or a Wholly Owned Restricted Subsidiary of the Company, shall be deemed deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be;
(viiviii) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Debt in exchange for, Hedging Obligations that are incurred for the purpose of fixing or the net proceeds of which are used hedging: (i) interest rate risk with respect to extend, refinance, renew, replace, defease or refund any floating rate Indebtedness that was is permitted by the terms of this Indenture to be incurredoutstanding; (ii) exchange rate risk with respect to any agreement or Indebtedness of such Person payable in a currency other than U.S. dollars; or (iii) commodities risk relating to commodities agreements, entered into in the ordinary course of business, for the purchase of raw material used by the Company and its Restricted Subsidiaries;
(viiiix) the Guarantee by the Company or any of its Restricted Subsidiaries of Indebtedness of the Company or a Restricted Subsidiary of the Company that was permitted to be incurred by another provision of Section 4.09;
(x) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt; provided, however, that if, and to the extent if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company.;
(ixxi) Indebtedness incurred by the Company or any of its Restricted Subsidiaries constituting reimbursement obligations with respect to letters of credit issued in the ordinary course of business, including without limitation to letters of credit in respect to workers' compensation claims or self- insurance, or other Indebtedness with respect to reimbursement type obligations regarding workers' compensation claims; provided, however, that upon the drawing of such letters of credit or the incurrence of such Indebtedness, such obligations are reimbursed within 30 days following such drawing or incurrence;
(xii) Indebtedness arising from agreements of the Company or a Restricted Subsidiary providing for indemnification, adjustment of purchase price or similar obligations, in each case, incurred or assumed in connection with the disposition of any business, asset or Subsidiary, other than guarantees of Indebtedness incurred by any Person acquiring all or any portion of such business, assets or Subsidiary for the purpose of financing such acquisition; provided that (x) such Indebtedness is not reflected on the balance sheet of the Company or any Restricted Subsidiary (contingent obligations referred to in a footnote or footnotes to financial statements and not otherwise reflected on the balance sheet shall not be deemed to be reflected on such balance sheet for purposes of this clause (x)) and (y) the maximum assumable liability in respect of such Indebtedness shall at no time exceed the gross proceeds including non-cash proceeds (the fair market value of such non-cash proceeds being measured at the time received and without giving effect to any such subsequent changes in value) actually received by the Company and/or such Restricted Subsidiary in connection with such disposition;
(xiii) Indebtedness incurred by the Company or any of its Restricted Subsidiaries which is subordinated to the Notes and the Guarantees; provided that such Indebtedness matures after the date on which the Notes mature and that no cash interest is payable with respect to such Indebtedness until after the date on which the Notes mature;
(xiv) obligations in respect of performance and surety bonds and completion guarantees provided by the Company or any Restricted Subsidiary in the ordinary course of business;
(xv) guarantees incurred in the ordinary course of business in an aggregate principal amount not to exceed $10.0 million at any time outstanding; and
(xvi) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are additional Indebtedness, including Attributable Debt incurred for after the purpose of fixing or hedging interest rate risk with respect to any floating rate indebtedness that is permitted by the terms date of this Indenture to be outstanding; and
(x) the incurrence by the Company and its Restricted Subsidiaries of additional Indebtedness Indenture, in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any other Indebtedness incurred pursuant to this clause (xvi), not to exceed $7.5 million 25.0 million. For purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (i) through (xvi) above or is entitled to be incurred pursuant to the first paragraph of this Section 4.09, the Company shall be permitted to classify such item of Indebtedness in any manner that complies with this Section 4.09. In addition, the Company may, at any time, change the classification of an item of Indebtedness (or any portion thereof) to any other clause or to the first paragraph of this Section 4.09 hereof provided that the Company would be permitted to incur such item of Indebtedness (or portion thereof) pursuant to such other clause or the first paragraph of this Section 4.09 hereof, as the case may be, at such time outstandingof reclassification. Accrual of interest, accretion or amortization of original issue discount and the accretion of accreted value shall not be deemed to be an incurrence of Indebtedness for purposes of this Section 4.09.
Appears in 1 contract
Incurrence of Indebtedness and Issuance of Preferred Stock. (a) For so long as any Senior Loan Obligations or any Permitted Refinancing Indebtedness thereof remains outstanding or any commitment to provide any Senior Loans shall exist, the Company shall, and shall cause its Restricted Subsidiaries to, comply with the covenants governing the incurrence of Indebtedness (including Acquired Debt) and the issuance of Disqualified Stock or the issuance by Restricted Subsidiaries of any shares of preferred stock contained in the Senior Loan Documents (as the same may be amended, restated, supplemented, replaced, refinanced or modified from time to time or waived or consented to in writing) or any corresponding provisions contained in the credit agreement or facility governing the Permitted Refinancing Indebtedness (as applicable).
(b) From and after the date of a Covenant Trigger Event:
(1) The Company shall will not, and shall will not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guaranty guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "“incur"”) any Indebtedness (including Acquired Debt); provided, however, that, so long as no Default or Event of Default has occurred and is continuing, the Company will not issue any Disqualified Stock and will not permit any of its Restricted Subsidiaries may incur to issue any shares of preferred stock.
(2) The provisions of Section 4.09(b)(1) hereof will not prohibit the incurrence of any of the following items of Indebtedness (including Acquired collectively, “Permitted Debt) if the Fixed Charge Coverage Ratio for the Company's most recently ended four full fiscal quarters for which financial statements are available immediately preceding the date on which such additional Indebtedness is incurred would have been at least 2.0 to 1, determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the additional Indebtedness had been incurred at the beginning of such four-quarter period. The foregoing provisions will not apply to:”):
(iA) the incurrence by the Company and its Restricted Subsidiaries any Guarantor of the Senior Loan Obligations and any Permitted Refinancing Indebtedness pursuant to the Bank Credit Facility in an aggregate principal amount not to exceed $50.0 million at any one time outstanding less any Net Proceeds of Asset Sales applied to permanently reduce the Bank Credit Facility pursuant to the provisions described in Section 4.10thereof;
(iiB) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;
(iii) the incurrence by the Company and its Restricted Subsidiaries of Indebtedness represented by the Senior Subordinated Notes and the Guarantees thereof by any Restricted Subsidiaries pursuant to the provisions in Section 12.01 hereof;
(ivC) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case case, incurred for the purpose of financing all or any part of the purchase price or cost of construction design, construction, installation or improvement of property, plant or equipment used in the business of the Company or such any of its Restricted SubsidiarySubsidiaries, in an aggregate principal amount amount, including all indebtedness incurred to renew, refund, refinance, replace, defease or discharge any Indebtedness incurred pursuant to this clause (C), not to exceed $5.0 15 million at any time outstanding;
(vD) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness in connection with the acquisition of assets or a new Restricted Subsidiary; provided that such Indebtedness was incurred by the prior owner of such assets or such Restricted Subsidiary prior to such acquisition by the Company or one of its Restricted Subsidiaries and was not incurred in connection with, or in contemplation of, such acquisition by the Company or one of it Restricted Subsidiaries; and provided further that the principal amount (or accreted value, as applicable) of such Indebtedness, together with any other outstanding Indebtedness incurred pursuant to this clause (v), does not exceed $5.0 million;
(vi) the incurrence of intercompany Indebtedness between or among the Company and any of its Wholly Owned Restricted Subsidiaries; provided, that however, that:
(i) if the Company or any Guarantor is the obligor on such Indebtedness and the payee is not the Company or a Guarantor, such Indebtedness must be unsecured and expressly subordinated to the prior payment in full in cash of all Obligations then due with respect to the Notes, in the case of the Company, or the Note Guarantee, in the case of a Guarantor; and
(ii) (1) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Wholly Owned Restricted Subsidiary of the Company or and (2) any sale or other transfer of any such Indebtedness to a Person that is neither not either the Company, Company or a Wholly Owned Restricted Subsidiary of the Company, shall will be deemed deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be, that was not permitted by this clause (D);
(viiE) the issuance by any of the Company’s Restricted Subsidiaries to the Company or to any of its Restricted Subsidiaries of shares of preferred stock; provided, however, that:
(i) any subsequent issuance or transfer of Equity Interests that results in any such preferred stock being held by a Person other than the Company or a Restricted Subsidiary of the Company; and
(ii) any sale or other transfer of any such preferred stock to a Person that is not either the Company or a Restricted Subsidiary of the Company, will be deemed, in each case, to constitute an issuance of such preferred stock by such Restricted Subsidiary that was not permitted by this clause (E);
(F) the incurrence by the Company or any of its Restricted Subsidiaries Guarantors of Permitted Refinancing Debt Hedging Obligations in exchange for, or the net proceeds ordinary course of which are used to extend, refinance, renew, replace, defease or refund Indebtedness that was permitted by this Indenture to be incurredbusiness;
(viiiG) the incurrence guarantee by the Company's Unrestricted Subsidiaries Company or any of Non-Recourse Debt; provided, that if, and to the extent any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence Guarantors of Indebtedness by of the Company or a Restricted Subsidiary of the Company.Company to the extent that the guaranteed Indebtedness was permitted to be incurred by another provision of this Section 4.09(b)(2); provided that if the Indebtedness being guaranteed is subordinated to or pari passu with the Notes, then the Guarantee must be subordinated or pari passu, as applicable, to the same extent as the Indebtedness guaranteed;
(ixH) the incurrence by the Company or any of its Restricted Subsidiaries the Guarantors of Hedging Obligations that are incurred for Indebtedness in respect of workers’ compensation claims, self-insurance obligations, bankers’ acceptances, performance and surety bonds in the purpose ordinary course of fixing or hedging interest rate risk with respect to any floating rate indebtedness that is permitted business;
(I) the incurrence by the terms Company or any of the Guarantors of Indebtedness arising from the honoring by a bank or other financial institution of a check, draft or similar instrument inadvertently drawn against insufficient funds, so long as such Indebtedness is covered within five Business Days;
(J) Subordinated Indebtedness or preferred stock in an aggregate principal amount, including all Indebtedness incurred to renew, refund, refinance, replace, defease or discharge any Indebtedness incurred pursuant to this Indenture clause (J), not to be exceed $25 million at any time outstanding;
(K) Indebtedness of the Company or a Restricted Subsidiary thereof to current or former officers, directors and employees thereof, their respective estates, spouses or former spouses, in each case to finance the purchase or redemption of Equity Interests of the Company in compliance with Section 4.07(b)(2)(E) hereof;
(L) Indebtedness of the Company or a Restricted Subsidiary thereof which after giving pro forma effect to the incurrence thereof and the application of net proceeds therefrom would permit the incurrence of at least $1.00 of additional Indebtedness pursuant to the Fixed Charge Coverage Ratio test set forth in clause (2) of the definition of the term “Permitted Refinancing Indebtedness”; and
(xM) the incurrence by the Company and the Guarantors of Indebtedness represented by the Notes (including PIK Notes) and any related Guarantee.
(c) The Company will not incur, and will not permit any Guarantor to incur, any Indebtedness (other than with respect to the exercise by the Holders of the option to purchase the Second Lien Obligations as set forth in Section 17 of the Intercreditor Agreement) that is pari passu in right of payment with the Notes. For purposes of determining compliance with this Section 4.09, in the event that an item of Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (A) through (M) above, the Company will be permitted to classify such item of Indebtedness on the date of its Restricted Subsidiaries incurrence, or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09. Indebtedness under Credit Facilities outstanding on the date on which the Notes are first Issued and authenticated under this Indenture will initially be deemed to have been incurred on such date in reliance on the exception provided by clause (A) of the definition of Permitted Debt. The accrual of interest or preferred stock dividends, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, the reclassification of preferred stock as Indebtedness due to a change in accounting principles and the payment of dividends on preferred stock or Disqualified Stock in the form of additional shares of the same class of preferred stock or Disqualified Stock will not be deemed to be an aggregate incurrence of Indebtedness or an issuance of preferred stock or Disqualified Stock for purposes of this Section 4.09; provided, in each such case, that the amount thereof is included in Fixed Charges of the Company as accrued. For purposes of determining compliance with any U.S. dollar-denominated restriction on the incurrence of Indebtedness, the U.S. dollar-equivalent principal amount of Indebtedness denominated in a foreign currency shall be utilized, calculated based on the relevant currency exchange rate in effect on the date such Indebtedness was incurred. Notwithstanding any other provision of this Section 4.09, the maximum amount of Indebtedness that the Company or any Restricted Subsidiary may incur pursuant to this Section 4.09 shall not be deemed to exceed $7.5 million be exceeded solely as a result of fluctuations in exchange rates or currency values. The amount of any Indebtedness outstanding as of any date will be:
(1) the accreted value of the Indebtedness, in the case of any Indebtedness issued with original issue discount;
(2) the principal amount of the Indebtedness, in the case of any other Indebtedness; and
(3) in respect of Indebtedness of another Person secured by a Lien on the assets of the specified Person, the lesser of:
(A) the Fair Market Value of such assets at any time outstandingthe date of determination; and
(B) the amount of the Indebtedness of the other Person.
Appears in 1 contract
Sources: Indenture (WHX Corp)
Incurrence of Indebtedness and Issuance of Preferred Stock. (a) The Company shall will not, and shall not directly or indirectly:
(1) Incur any Indebtedness or issue any Disqualified Capital Stock; or
(2) cause or permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guaranty or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") Incur any Indebtedness (including Acquired Debt)or issue any Disqualified Capital Stock or preferred stock, in each case, other than Permitted Indebtedness; provided, however, that, so long as no Default or Event of Default has occurred and is continuing, that the Company may issue Disqualified Capital Stock and its Restricted Subsidiaries may incur Incur Indebtedness (including including, without limitation, Acquired Debt) ), and any Guarantor may issue preferred stock or Incur Indebtedness (including, without limitation, Acquired Debt), if the Fixed Charge Coverage Ratio for the Company's most recently ended four full fiscal quarters for which financial statements are available immediately preceding the date on which such additional Indebtedness is incurred would have been at least 2.0 to 1, determined on a after giving pro forma basis (including a pro forma effect to such proposed Incurrence or issuance and the receipt and application of the net proceeds therefrom), as if the additional Indebtedness had been incurred Company’s Consolidated Coverage Ratio would be at the beginning of such four-quarter period. The foregoing provisions least 2.00 to 1.00.
(b) This Section 4.09 will not apply to:prohibit the incurrence of any of the following (collectively, “Permitted Indebtedness”):
(i1) Indebtedness of the incurrence Company or any Restricted Subsidiary outstanding on the Issue Date (other than Indebtedness under the Bank Credit Agreement) as reduced by the amount of any scheduled amortization payments or mandatory prepayments when actually paid or permanent reductions thereof;
(2) Indebtedness Incurred by the Company under the Initial Notes and its by the Guarantors under the Guarantees;
(3) Indebtedness Incurred by the Company or any Restricted Subsidiaries of Indebtedness Subsidiary pursuant to the Bank Credit Facility in an Agreement or other Credit Facilities; provided that the aggregate principal amount not to exceed $50.0 million at any one time outstanding less any Net Proceeds of Asset Sales applied to permanently reduce the Bank Credit Facility pursuant to the provisions described in Section 4.10;
(ii) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;
(iii) the incurrence by the Company and its Restricted Subsidiaries of Indebtedness represented by the Senior Subordinated Notes and the Guarantees thereof by any Restricted Subsidiaries pursuant to the provisions in Section 12.01 hereof;
(iv) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of the Company or such Restricted Subsidiary, in an aggregate principal amount not to exceed $5.0 million at any time outstanding;
(v) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness in connection with the acquisition of assets or a new Restricted Subsidiary; provided that such Indebtedness was incurred by the prior owner of such assets or such Restricted Subsidiary prior to such acquisition by the Company or one of its Restricted Subsidiaries and was not incurred in connection with, or in contemplation of, such acquisition by the Company or one of it Restricted Subsidiaries; and provided further that the principal amount (or accreted value, as applicable) of such Indebtedness, together with any other outstanding Indebtedness incurred pursuant to under this clause (v3) as of any date of Incurrence (after giving pro forma effect to the application of the proceeds of such Incurrence), does not exceed $5.0 million;
(vi) the incurrence of intercompany Indebtedness between or among the Company and any of its Wholly Owned Restricted Subsidiaries; provided, that any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Wholly Owned Restricted Subsidiary of the Company or any sale or other transfer of any such Indebtedness to a Person that is neither the Company, or a Wholly Owned Restricted Subsidiary of the Company, shall be deemed to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be;
(vii) the incurrence by the Company or any of its Restricted Subsidiaries of including all Permitted Refinancing Debt in exchange forIndebtedness Incurred to repay, or the net proceeds of which are used to redeem, extend, refinance, renew, replace, defease or refund any Indebtedness Incurred pursuant to this clause (3), shall not exceed the greater of (i) $3.5 billion and (ii) the maximum principal amount of Indebtedness that was permitted by this Indenture could be Incurred such that after giving effect to such Incurrence, the Company’s Consolidated Secured Leverage Ratio would be no greater than 4.75 to 1.00, to be incurredreduced dollar-for-dollar by the aggregate amount of all Net Cash Proceeds of Asset Sales applied by an Obligor to repay Indebtedness under the Credit Facilities pursuant to Section 4.10 hereof;
(viii4) the incurrence by the Company's Unrestricted Subsidiaries Indebtedness of Non-Recourse Debt; provided, that if, and a Restricted Subsidiary to the extent Company or any Guarantor, or of the Company to any Guarantor, for so long as such Indebtedness is held by an Obligor; provided that if as of any date any Person other than an Obligor acquires any such Indebtedness ceases to be Non-Recourse Debt or holds a Lien in respect of an Unrestricted Subsidiarysuch Indebtedness (other than a Permitted Lien), such event acquisition or holding shall be deemed to constitute be an incurrence Incurrence of Indebtedness not constituting Permitted Indebtedness under this clause (4) by a Restricted Subsidiary the issuer of the Company.such Indebtedness;
(ix5) the incurrence Permitted Refinancing Indebtedness;
(6) Indebtedness Incurred by the Company or any Restricted Subsidiary solely to finance the construction or acquisition or improvement of, or consisting of its Restricted Subsidiaries Capitalized Lease Obligations Incurred to acquire rights of Hedging Obligations that are incurred for use in, property or assets or any kind whatsoever, whether real, personal or mixed and whether tangible or intangible and including all contract rights, income or revenue rights, real property interests, trademarks, trade names, equipment or Equity Interests or ownership of any other Person useful in any Core Business, not to exceed the purpose greater of fixing or hedging interest rate risk with respect to any floating rate indebtedness that is permitted by the terms of this Indenture to be outstanding; and
(x) $75 million or (y) 25% of LTM EBITDA, in each case in aggregate principal amount outstanding at any time (including all Permitted Refinancing Indebtedness Incurred to repay, redeem, extend, refinance, renew, replace, defease or refund any Indebtedness Incurred pursuant to this clause (6)) for all of the incurrence by Company and its Restricted Subsidiaries;
(7) Hedging Obligations and Interest Swap Obligations entered into not as speculative Investments but as hedging transactions designed to protect the Company and its Restricted Subsidiaries against fluctuations in interest rates in connection with Indebtedness otherwise permitted hereunder or against exchange rate risk or commodity pricing risk;
(8) Indebtedness of additional the Company or any Restricted Subsidiary arising in respect of (x) performance bonds, completion guarantees and similar arrangements (to the extent that the Incurrence thereof does not result in the Incurrence of any obligation for the payment of borrowed money of others), in the ordinary course of business; provided, that such Indebtedness shall be Incurred solely in an aggregate amount connection with the development, construction, improvement or enhancement of assets useful in the business of the Company and its Restricted Subsidiaries or the development, improvement or enhancement of the operations of the Company and its Restricted Subsidiaries or (y) Support Agreements;
(9) Indebtedness of the Company or any Restricted Subsidiary arising in respect of letters of credit, bankers’ acceptances, worker’s compensation claims, payment obligations in connection with self-insurance or similar obligations, surety bonds and appeal bonds (to the extent that the Incurrence thereof does not to exceed $7.5 million at result in the Incurrence of any time outstanding.obligation for the payment of borrowed money of others), in the ordinary course of business, in amounts and for the purposes customary in such Person’s industry;
Appears in 1 contract
Sources: Indenture (Red Rock Resorts, Inc.)
Incurrence of Indebtedness and Issuance of Preferred Stock. The Company shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guaranty guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") any Indebtedness (including Acquired Debt)Indebtedness) and that the Company will not permit any of its Restricted Subsidiaries to issue any shares of preferred stock; provided, however, that, so long as no Default or Event of Default has occurred and is continuing, that the Company and its Restricted Subsidiaries may incur Indebtedness (including Acquired Debt) if the Fixed Charge Consolidated Interest Coverage Ratio for the Company's most recently ended four full fiscal quarters for which internal financial statements are available immediately preceding the date on which such additional Indebtedness is incurred would have been at least 2.0 2.00 to 1, determined 1 on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the additional Indebtedness had been incurred at the beginning of such four-quarter period. The foregoing provisions will not apply to:Notwithstanding the foregoing, the Company and, to the extent set forth below, its Restricted Subsidiaries may incur the following (each of which shall be given independent effect):
(ia) Indebtedness of the incurrence by Company under the Notes and this Indenture;
(b) Permitted Working Capital Indebtedness of the Company and its Restricted Subsidiaries;
(c) Existing Indebtedness (other than Permitted Working Capital Indebtedness or Indebtedness under the Letter of Credit Facility);
(d) Indebtedness of the Company and its Restricted Subsidiaries under the Letter of Credit Facility;
(e) Capital Expenditure Indebtedness, Capital Lease Obligations and purchase money Indebtedness pursuant to of the Bank Credit Facility Company and its Restricted Subsidiaries in an aggregate principal amount not to exceed $50.0 50 million at any one time outstanding less any Net Proceeds of Asset Sales applied to permanently reduce the Bank Credit Facility pursuant to the provisions described in Section 4.10outstanding;
(iii) the incurrence by Hedging Obligations of the Company and its Restricted Subsidiaries covering Indebtedness of the Existing IndebtednessCompany or such Restricted Subsidiary (which Indebtedness is otherwise permitted to be incurred under this covenant) to the extent the notional principal amount of any such Hedging Obligation does not exceed the principal amount of the Indebtedness to which such Hedging Obligation relates; or (ii) repurchase agreements, reverse repurchase agreements or similar agreements relating to marketable direct obligations issued or unconditionally guaranteed by the United States Government or issued by any agency thereof and backed by the full faith and credit of the United States, in each case maturing within one year from the date of acquisition; provided that the terms of such agreements comply with the guidelines set forth in Federal-Financial Agreements of Depository Institutions with Securities and Others (or any successor guidelines), as adopted by the Comptroller of the Currency;
(iiig) the incurrence by Indebtedness of the Company and its Restricted Subsidiaries in an aggregate principal amount not to exceed $30 million at any time outstanding;
(h) Indebtedness of the Company representing guarantees of Indebtedness represented incurred by the Senior Subordinated Notes and the Guarantees thereof by any one of its Restricted Subsidiaries pursuant to the provisions to, and in Section 12.01 hereofcompliance with, another provision of this covenant;
(ivi) Indebtedness of the Company or any of its Restricted Subsidiaries representing guarantees of a portion of the Indebtedness of Wheeling-Nisshin which is not greater than the Company's or such Restricted Subsidiary's pro rata ownership of the outstanding Equity Interests in Wheeling-Nisshin; provided, however, that (i) such Indebtedness is expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes and (ii) at the time of incurrence and after giving effect to the Indebtedness of Wheeling-Nisshin which is being guaranteed, the Consolidated Interest Coverage Ratio of Wheeling-Nisshin for its most recently ended four full fiscal quarters for which internal financial statements are available would have been at least 2.00 to 1, determined on a pro forma basis as if any additional Indebtedness had been incurred at the beginning of such four-quarter period;
(j) Indebtedness of the Company or its Restricted Subsidiaries representing guarantees of Indebtedness of Wheeling-Nisshin required to be made pursuant to the Letter of Undertaking not to exceed $10 million;
(k) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of the Company or such Restricted Subsidiary, in an aggregate principal amount not to exceed $5.0 million at any time outstanding;
(v) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness in connection with the acquisition of assets or a new Restricted Subsidiary; provided that such Indebtedness was incurred by the prior owner of such assets or such Restricted Subsidiary prior to such acquisition by the Company or one of its Restricted Subsidiaries and was not incurred in connection with, or in contemplation of, such acquisition by the Company or one of it Restricted Subsidiaries; and provided further that the principal amount (or accreted value, as applicable) of such Indebtedness, together with any other outstanding Indebtedness incurred pursuant to this clause (v), does not exceed $5.0 million;
(vi) the incurrence of intercompany Indebtedness between or among the Company and any of its Wholly Owned Restricted Subsidiaries; provided, however, that (i) if the Company is the obligor on such Indebtedness, such Indebtedness is expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes and (ii) (A) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Wholly Owned Restricted Subsidiary of the Company or and (B) any sale or other transfer of any such Indebtedness to a Person that is neither not either the Company, Company or a Wholly Owned Restricted Subsidiary of the Company, shall be deemed deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be;
(vii) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Debt in exchange for, or the net proceeds of which are used to extend, refinance, renew, replace, defease or refund Indebtedness that was permitted by this Indenture to be incurred;
(viii) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt; provided, that if, and to the extent any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company.
(ix) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk with respect to any floating rate indebtedness that is permitted by the terms of this Indenture to be outstanding; and
(xl) Indebtedness under the Term Loan Agreement; and
(m) any Permitted Refinancing Indebtedness representing a replacement, renewal, refinancing or extension of Indebtedness permitted under the first paragraph and clauses (c) and (l) of this covenant. In the event that the incurrence of any Indebtedness would be permitted by the first paragraph set forth above or one or more of the provisions set forth in the second paragraph above, the Company may designate (in the form of an officer's certificate delivered to the Trustee) the incurrence by the Company and its Restricted Subsidiaries particular provision of additional Indebtedness in an aggregate amount not this Indenture pursuant to exceed $7.5 million at any time outstandingwhich it is incurring such Indebtedness.
Appears in 1 contract
Incurrence of Indebtedness and Issuance of Preferred Stock. (a) The Company shall not, and shall not permit any of its Subsidiaries Restricted Subsidiary to, Incur, directly or indirectly, create, incur, issue, assume, guaranty or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") any Indebtedness (including Acquired Debt)Indebtedness) and shall not permit any of its Restricted Subsidiaries that is not a Guarantor to issue any Preferred Stock; provided, however, that, so long as no Default or Event of Default has occurred and is continuing, that the Company and its Restricted Subsidiaries may incur Incur Indebtedness (including Acquired Debt) Indebtedness), and the Restricted Subsidiaries that are not Guarantors may issue Preferred Stock, if the Fixed Charge Coverage Ratio for the Company's most recently ended four full fiscal quarters for which financial statements are available immediately preceding on the date on which of such additional Indebtedness Incurrence or issuance and after giving effect thereto, the Consolidated Adjusted Debt to EBITDA Ratio is incurred would have been at least 2.0 less than 6.00 to 11.00 (this test being referred to herein as the “Leverage Test”). For the purpose of the calculation of the Leverage Test, determined with respect to any period included in such calculation, Consolidated EBITDA, the components of Consolidated Interest Expense and Consolidated Adjusted Debt shall be calculated with respect to such period by the Company in good faith on a pro forma basis (including a pro forma application of the net proceeds therefromand consistent with Permitted Adjustments), as if giving effect to any Permitted Acquisition, Asset Disposition or Incurrence or redemption or repayment of Indebtedness that has given rise to the additional Indebtedness had been incurred at need for such calculation, has occurred during such period or has occurred after such period and on or prior to the beginning date of such four-quarter period. calculation.
(b) The foregoing provisions will shall not apply to:
(i) the incurrence by the Company and its Restricted Subsidiaries of Indebtedness pursuant to the Bank Credit Facility in an aggregate principal amount not to exceed $50.0 million at any one time outstanding less any Net Proceeds of Asset Sales applied to permanently reduce the Bank Credit Facility pursuant to the provisions described in Section 4.10;
(ii) the incurrence Incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;
(iiiii) the incurrence Incurrence by the Company and its Restricted Subsidiaries of the Indebtedness represented by the Senior Subordinated Notes and the Guarantees thereof (not including any Additional Notes);
(iii) (A) Purchase Money Indebtedness and mortgage financings (excluding Capital Lease Obligations and Synthetic Lease Obligations) hereafter Incurred by the Company or any of its Restricted Subsidiaries pursuant to in an aggregate principal amount that does not exceed $70,000,000 at any one time outstanding and (B) Indebtedness hereafter incurred by the provisions Company or any of its Restricted Subsidiaries under any Channel Financing Facility in Section 12.01 hereofan aggregate principal amount that, when taken together with the aggregate then outstanding principal amount of Indebtedness incurred under all other Channel Financing Facilities of the Company and its Restricted Subsidiaries incurred under this clause (iii), does not exceed $30,000,000 at any one time outstanding;
(iv) the incurrence Incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness represented in exchange for, or the net proceeds of which are used to extend, Refinance, renew, replace, defease or refund, Indebtedness that was permitted by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of this Indenture to be Incurred by the Company or such Restricted Subsidiary, in an aggregate principal amount not to exceed $5.0 million at any time outstanding;; Table of Contents
(v) the incurrence Incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness in connection with the acquisition of assets or a new Restricted Subsidiary; provided that such Indebtedness was incurred by the prior owner of such assets or such Restricted Subsidiary prior to such acquisition by the Company or one of its Restricted Subsidiaries and was not incurred in connection with, or in contemplation of, such acquisition by the Company or one of it Restricted Subsidiaries; and provided further that the principal amount (or accreted value, as applicable) of such Indebtedness, together with any other outstanding Indebtedness incurred pursuant to this clause (v), does not exceed $5.0 million;
(vi) the incurrence of intercompany Indebtedness (A) between or among the Company and any Restricted Subsidiaries of the Company and (B) consisting of debits and credits among the Company and its Wholly Owned Restricted SubsidiariesSubsidiaries pursuant to a Centralized Cash Management System; provided, however, that (1) any intercompany Indebtedness which is borrowed by the Company or a Guarantor from a Restricted Subsidiary that is not a Guarantor shall be expressly subordinated to the Notes or such Guarantor’s Guarantee and (2) (x) any subsequent issuance or transfer of Equity Interests Capital Stock that results in any such Indebtedness being held by a Person other than the Company or a Wholly Owned Restricted Subsidiary of the Company Company, or (y) any sale or other transfer of any such Indebtedness to a Person that is neither other than the Company, Company or a Wholly Owned Restricted Subsidiary of the Company, or a lender or agent upon exercise of remedies under a pledge of such Indebtedness under the Credit Agreement, shall be deemed deemed, in each case of the foregoing clauses (2)(x) and (y), to constitute an incurrence Incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be;
(viivi) the incurrence Incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Debt in exchange for, or the net proceeds of which are used to extend, refinance, renew, replace, defease or refund Indebtedness that was permitted by this Indenture to be incurred;
(viii) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt; provided, that if, and to the extent any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company.
(ix) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Interest Swap Obligations that are incurred Incurred for the purpose of fixing or hedging interest rate risk with respect to any floating rate indebtedness Indebtedness that is permitted by the terms of this Indenture to be outstanding; and;
(vii) Indebtedness of the Company or any Restricted Subsidiary under the Credit Agreement in an aggregate amount at any time outstanding not to exceed $900,000,000, less, to the extent a permanent repayment and/or commitment reduction is required thereunder as a result of such application, the aggregate amount of Net Proceeds applied to repayments under the Credit Agreement in accordance with Section 5.05;
(viii) the Incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness under Currency Agreements;
(ix) the Incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness of the Company or any of its Restricted Subsidiaries represented by letters of credit for the account of the Company or such Restricted Subsidiary, as the case may be, in order to provide security for workers’ compensation claims, payment obligations in connection with self-insurance or similar requirements in the Ordinary Course of Business;
(x) the incurrence Incurrence by the Company and or any of its Restricted Subsidiaries of Indebtedness in respect of performance bonds, bankers’ acceptances, workers’ compensation claims, completion guarantees, letters of credit surety or appeal bonds, payment obligations in connection with self-insurance or similar obligations Incurred in the Ordinary Course of Business; Table of Contents
(xi) the Guarantee by the Company or any of its Restricted Subsidiaries of Indebtedness of the Company or a Restricted Subsidiary of the Company that was permitted to be Incurred by another provision of this Section 5.04;
(xii) Indebtedness arising from agreements of the Company or a Restricted Subsidiary of the Company providing for indemnification, adjustment of purchase price or similar obligations, in each case, Incurred in connection with an Asset Disposition or acquisition permitted by this Indenture or other sale or disposition of assets permitted under this Indenture;
(xiii) Indebtedness of a Restricted Subsidiary Incurred and outstanding on or prior to the date on which such Restricted Subsidiary was acquired by the Company (other than Indebtedness Incurred in contemplation of, in connection with, as consideration in, or to provide all or any portion of the funds or credit support utilized to consummate, the transaction or series of related transactions pursuant to which such Restricted Subsidiary became a Subsidiary of or was otherwise acquired by the Company); provided, however, that on the date that such Restricted Subsidiary is acquired by the Company, the Company would have been able to Incur $1.00 of additional Indebtedness under the first paragraph of this Section 5.04 pursuant to the Leverage Test after giving effect to the Incurrence of such Indebtedness pursuant to this clause (xiii);
(A) Indebtedness represented by Capital Lease Obligations (other than Capital Lease Obligations described in the following clause (B)) and Synthetic Lease Obligations hereafter Incurred by the Company or any of its Restricted Subsidiaries in an aggregate principal amount that, when taken together with the Remaining Present Value of such outstanding Capital Lease Obligations and Synthetic Lease Obligations relating to Sale and Leaseback Transactions entered into in accordance with Section 8.05(b)(ii) of the Credit Agreement (as in effect on the date of this Indenture), does not exceed $150,000,000 at any time outstanding and (B) Indebtedness represented by Capital Lease Obligations in connection with the Data Center Sale and Leaseback Transactions and the Wireless Tower Sale and Leaseback Transactions and in each case otherwise in compliance with the conditions set forth in the applicable definition thereof; provided that (x) the aggregate outstanding Remaining Present Value of (I) all leases entered into in connection with all Data Center Sale and Leaseback Transactions, plus (II) all leases entered into in connection with all Wireless Tower Sale and Leaseback Transactions, plus (y) all Indebtedness represented by Capital Lease Obligations and Synthetic Lease Obligations entered into under clause (A) does not at any time exceed $250,000,000 in the aggregate;
(xv) the Incurrence of other Indebtedness not to exceed $100,000,000 in aggregate principal amount at any time outstanding; and
(xvi) the Incurrence by a Receivables Subsidiary of Indebtedness in a Qualified Receivables Transaction that is without recourse (other than pursuant to representations, warranties, covenants, indemnities and performance guarantees customarily entered into in connection with a Receivables financing) to the Company or to any Restricted Subsidiary of the Company or its assets (other than such Receivables Subsidiary and its subsidiaries and assets), in an amount not to exceed $7.5 million 150,000,000 in aggregate principal amount at any time outstanding. Table of Contents
(c) For purposes of determining compliance with this Section 5.04, in the event that an item of Indebtedness meets the criteria of more than one of the categories of Indebtedness described in Sections 5.04(b)(i) through (xvi) or is entitled to be Incurred pursuant to Section 5.04(a), the Company shall, in its sole discretion, classify (or later reclassify) such item of Indebtedness in any manner that complies with this Section 5.04 and will only be required to include the amount and type of such Indebtedness in one of such clauses of Section 5.04(b) or pursuant to Section 5.04(a); provided that Indebtedness outstanding under the Credit Agreement as of the Closing Date shall be deemed to have been Incurred pursuant to clause (vii) of Section 5.04(b). Accrual of interest, accretion of accreted value, amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms as the Indebtedness on which such interest is being paid and any other issuance of securities paid-in-kind shall not be deemed to be an Incurrence of Indebtedness for purposes of this Section 5.04, but such amounts shall be included in Consolidated Adjusted Debt to the extent provided for in such definition. In addition, the Company may, at any time, change the classification of an item of Indebtedness (or any portion thereof) to any other clause of Section 5.04(b) or to Indebtedness properly Incurred under Section 5.04(a), provided that the Company would be permitted to Incur such item of Indebtedness (or portion thereof) pursuant to such other clause of Section 5.04(b) or Section 5.04(a), as the case may be, at such time of reclassification.
Appears in 1 contract
Sources: Indenture (Cincinnati Bell Inc)
Incurrence of Indebtedness and Issuance of Preferred Stock. The Company shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guaranty or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") any Indebtedness (including Acquired Debt)) and that the Company shall not issue any Disqualified Stock and shall not permit any of its Restricted Subsidiaries to issue any shares of preferred stock; provided, however, that, so long as no Default or Event of Default has occurred and is continuing, that the Company and its Restricted Subsidiaries may incur Indebtedness (including Acquired Debt) or issue shares of Disqualified Stock if the Fixed Charge Coverage Ratio for the Company's most recently ended four full fiscal quarters for which internal financial statements are available immediately preceding the date on which such additional Indebtedness is incurred or such Disqualified Stock is issued would have been at least 2.0 to 1, determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the additional Indebtedness had been incurred incurred, or the Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period. The foregoing provisions will limitations shall not apply to:
: (i) the incurrence by the Company and its Restricted Subsidiaries of Indebtedness pursuant to the Senior Bank Credit Facility in an aggregate principal amount not to exceed $50.0 million at any one time outstanding less any Net Proceeds of Asset Sales applied to permanently reduce the Bank Credit Facility pursuant to the provisions described in Section 4.10;
Debt; (ii) Guarantees of the Senior Bank Debt permitted under or required by the Credit Agreement and Guarantees permitted under or required by this Indenture; (iii) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;
; (iiiiv) the incurrence by the Company and its Restricted Subsidiaries of Indebtedness represented by the Senior Subordinated Notes and this Indenture, and the Guarantees thereof incurrence by any Restricted Subsidiaries pursuant of Guarantees required or permitted to the provisions in Section 12.01 hereof;
be incurred under this Indenture; (ivv) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or Obligations and/or additional Indebtedness constituting purchase money obligations, in each case incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of the Company or such Restricted Subsidiary, obligations in an aggregate principal amount not to exceed $5.0 million at any time outstanding;
; (vvi) the incurrence by the Company or of additional Indebtedness for any of its Restricted Subsidiaries of Indebtedness corporate purposes in connection with the acquisition of assets or a new Restricted Subsidiary; provided that such Indebtedness was incurred by the prior owner of such assets or such Restricted Subsidiary prior to such acquisition by the Company or one of its Restricted Subsidiaries and was not incurred in connection with, or in contemplation of, such acquisition by the Company or one of it Restricted Subsidiaries; and provided further that the an outstanding principal amount (or accreted value, as applicable) at no time exceeding $25.0 million (which may, but need not be, borrowed under the Credit Agreement); (vii) the incurrence by any Foreign Subsidiary of such Indebtedness, together which when aggregated with any other the principal amount of Indebtedness of all Foreign Subsidiaries then outstanding Indebtedness and incurred pursuant to this clause (vvii), does not exceed $5.0 million;
million (vior the equivalent thereof in any other currency) at any one time outstanding; (viii) the incurrence by any Restricted Subsidiary of the Company of Acquired Debt in an aggregate principal amount not to exceed $20.0 million for all Restricted Subsidiaries (reduced by the amount of Acquired Debt repaid with the Net Proceeds of Asset Sales of any Restricted Subsidiary subject to such Acquired Debt) that (a) has not been incurred in connection with, or in contemplation of such Restricted Subsidiary becoming a Restricted Subsidiary, or a merger of a Person subject to such Acquired Debt with or into such Restricted Subsidiary, and (b) is without recourse to the Company or any of its Restricted Subsidiaries or any of their respective assets (other than the Restricted Subsidiary subject to such Acquired Debt and its assets), and is not guaranteed by any such Person; provided that (A) after giving pro forma effect to the incurrence thereof as if incurred by the Company, the Company could incur at least $1.00 of Indebtedness under the first paragraph of this Section 4.09, (B) any Refinancing Indebtedness with respect thereto may not be incurred by any Person other than the Restricted Subsidiary that is the obligor on such Acquired Indebtedness, and (C) such Restricted Subsidiary becomes an Additional Guarantor upon incurrence of such Acquired Debt in accordance with this Indenture; (ix) the incurrence by the Company of Indebtedness in connection with the issuance of notes in payment of the repurchase, redemption, acquisition or retirement of Equity Interests of the Company or any Restricted Subsidiary of the Company to the extent permitted by Section 4.07 hereof; (x) Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk with respect to any floating rate Indebtedness that is permitted by the terms of the Credit Agreement or this Indenture to be outstanding; (xi) Indebtedness arising out of letters of credit, performance bonds, surety bonds, guarantees resulting from endorsements of negotiable instruments and bankers' acceptances, incurred in the ordinary course of business; (xii) all Obligations with respect to the foregoing; (xiii) the incurrence by the Company and its Restricted Subsidiaries of Indebtedness issued in exchange for, or the proceeds of which are used to repay, redeem, defease, extend, refinance, renew, replace, or refund Indebtedness referred to in clauses (ii) through (xii) above, and this clause (xiii) (the "Refinancing Indebtedness"); provided that (a) the principal amount of such Refinancing Indebtedness shall not exceed the principal amount of Indebtedness so extended, refinanced, renewed, replaced, substituted or refunded (plus the amount of fees, premiums, consent fees, prepayment penalties and expenses incurred in connection therewith); (b) in the case of Refinancing Indebtedness for Indebtedness permitted under clause (iii) or (viii) of this paragraph, the Refinancing Indebtedness shall have a Weighted Average Life to Maturity equal to or greater than the Weighted Average Life to Maturity of the Indebtedness being extended, refinanced, renewed, replaced or refunded or shall mature after the scheduled maturity date of the Notes; (c) to the extent such Refinancing Indebtedness refinances Indebtedness subordinate to the Notes, such Refinancing Indebtedness shall be subordinated in right of payment to the Notes on terms at least as favorable to the holders of Notes as those contained in the documentation governing the Indebtedness being extended, refinanced, renewed, replaced or refunded; and (d) with respect to Refinancing Indebtedness incurred by a Guarantor, such Refinancing Indebtedness shall rank no more senior, and shall be at least as subordinated, in right of payment to the Guarantee of such Guarantor as the Indebtedness being extended, refinanced, renewed, replaced or refunded; (xiv) Indebtedness of the Company (a) not to exceed an aggregate principal amount of $8.0 million outstanding at any time arising as a result of the issuance of tax-exempt industrial development bonds or similar tax-exempt public financing, and (b) additional Indebtedness arising out of the issuance of additional tax-exempt public financing obligations, but only to the extent that Indebtedness owing under the Credit Agreement is prepaid, concurrently with the receipt of the net proceeds of such issuance, in an amount at least equal to the amount of such proceeds, and term indebtedness or the availability of revolving credit borrowings under the Credit Agreement is permanently reduced by the amount of such net proceeds and (xv) the incurrence of intercompany Indebtedness between or among (a) the Company and any of its Wholly Owned Restricted Subsidiaries and (b) the Restricted Subsidiaries; provided, that (x) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Wholly Owned Restricted Subsidiary of the Company or and (y) any sale or other transfer of any such Indebtedness to a Person that is neither not either the Company, Company or a Wholly Owned Restricted Subsidiary of the Company, shall be deemed deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be;
(vii) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Debt in exchange for, or the net proceeds of which are used to extend, refinance, renew, replace, defease or refund Indebtedness that was permitted by this Indenture to be incurred;
(viii) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt; provided, that if, and to the extent any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company.
(ix) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk with respect to any floating rate indebtedness that is permitted by the terms of this Indenture to be outstanding; and
(x) the incurrence by the Company and its Restricted Subsidiaries of additional Indebtedness in an aggregate amount not to exceed $7.5 million at any time outstanding.
Appears in 1 contract
Sources: Indenture (Rayovac Corp)
Incurrence of Indebtedness and Issuance of Preferred Stock. (a) The Company shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guaranty guarantee or otherwise become directly or indirectly liable, contingently or otherwiseotherwise (collectively, "INCUR"), with respect to (collectively, "incur") any Indebtedness (including Acquired Debt), and the Company shall not issue any Disqualified Stock and shall not permit any of its Restricted Subsidiaries to issue any Disqualified Stock or preferred stock; provided, however, that, so long as no Default or Event of Default has occurred and is continuing, that the Company and its Restricted Subsidiaries may incur Indebtedness (including Acquired Debt) or issue Disqualified Stock if the Fixed Charge Coverage Ratio for the Company's most recently ended four full fiscal quarters for which internal financial statements are available immediately preceding the date on which such additional Indebtedness is incurred or such Disqualified Stock is issued would have been at least 2.0 to 1, determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the additional Indebtedness had been incurred or the Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period. The foregoing provisions will .
(b) Subsection (a) of this Section 4.9 shall not apply to:prohibit the incurrence of any of the following items of Indebtedness (collectively, "PERMITTED DEBT"):
(i) the incurrence by the Company and its Restricted Subsidiaries of Indebtedness pursuant to the Bank and letters of credit under Credit Facility Facilities in an aggregate principal amount not to exceed $50.0 million at any one time outstanding under this clause (i) (with letters of credit being deemed to have a principal amount equal to the maximum potential liability of the Company and its Restricted Subsidiaries thereunder) not to exceed the greater of (x) $150.0 million less any the aggregate amount of all Net Proceeds of Asset Sales applied by the Company or any of its Restricted Subsidiaries since the date of this Indenture to permanently reduce the Bank repay any term Indebtedness under a Credit Facility or to repay any Indebtedness under a Credit Facility and effect a corresponding commitment reduction thereunder pursuant to Section 4.14 hereof and (y) the provisions described in Section 4.10amount of the Borrowing Base as of the date of such incurrence;
(ii) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;
(iii) the incurrence by the Company and its Restricted Subsidiaries the Co-Obligor of Indebtedness represented by the Senior Subordinated Notes Securities to be issued on the date of this Indenture and the Guarantees thereof by any Restricted Subsidiaries Exchange Securities to be issued pursuant to the provisions in Section 12.01 hereofRegistration Rights Agreement and Guarantees thereof, if any, by Domestic Subsidiaries of the Company;
(iv) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case case, incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of the Company or such Restricted Subsidiary, in an aggregate principal amount amount, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (iv), not to exceed $5.0 25.0 million at any time outstanding;
(v) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in connection with the acquisition of assets or a new Restricted Subsidiary; provided that such Indebtedness was incurred by the prior owner of such assets or such Restricted Subsidiary prior to such acquisition by the Company or one of its Restricted Subsidiaries and was not incurred in connection withexchange for, or in contemplation ofthe net proceeds of which are used to refund, such acquisition refinance or replace Indebtedness (other than intercompany Indebtedness) that was permitted by the Company this Indenture to be incurred under Section 4.9(a) hereof or one of it Restricted Subsidiaries; and provided further that the principal amount clauses (or accreted valueii), as applicable) of such Indebtedness(iii), together with any other outstanding Indebtedness incurred pursuant to this clause (iv), (v), does not exceed $5.0 million(xi) or (xii) of this Section 4.9(b);
(vi) the incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness between or among the Company and any of its Wholly Owned Restricted Subsidiaries; provided, that however, that:
(A) if the Company or the Co-Obligor is the obligor on such Indebtedness, such Indebtedness must be expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Securities; and
(B) (i) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Wholly Owned Restricted Subsidiary of the Company or and (ii) any sale or other transfer of any such Indebtedness to a Person that is neither not either the Company, Company or a Wholly Owned Restricted Subsidiary of the Company, Company shall be deemed deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be, that was not permitted by this clause (vi);
(vii) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Debt in exchange for, or the net proceeds of which are used to extend, refinance, renew, replace, defease or refund Indebtedness that was permitted by this Indenture to be incurred;
(viii) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt; provided, that if, and to the extent any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company.
(ix) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are incurred in the ordinary course of business and not for speculative purposes;
(viii) the purpose of fixing or hedging interest rate risk with respect to any floating rate indebtedness that is permitted Guarantee by the terms Company or the Co-Obligor of Indebtedness of the Company or a Restricted Subsidiary of the Company that was permitted to be incurred under this Section 4.9; provided that if the Indebtedness being guaranteed is subordinated to or pari passu with the Securities, then the Guarantee shall be subordinated to the same extent as the Indebtedness guaranteed;
(ix) the accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock will not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Indenture to be outstandingcovenant; andprovided, in each such case, that the amount thereof is included in Fixed Charges of the Company as accrued;
(x) Obligations in respect of performance and surety bonds and completion guarantees provided by the Company or any Restricted Subsidiary in an aggregate principal amount at any time outstanding not to exceed $25.0 million;
(xi) the incurrence by the Company and or any of its Restricted Subsidiaries of Acquired Debt in an aggregate principal amount at any time outstanding not to exceed $25.0 million;
(xii) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (xii), not to exceed $7.5 million at 25.0 million; and
(xiii) the Guarantee by Domestic Subsidiaries of the Company of Indebtedness of the Company permitted to be incurred under another provision of this Section 4.9.
(c) The Company shall not incur any time outstandingIndebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Company unless such Indebtedness is also contractually subordinated in right of payment to the Securities on substantially identical terms; provided, however, that no Indebtedness of the Company shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company solely by virtue of being unsecured.
(d) For purposes of determining compliance with this Section 4.9, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (i) through (xii) of Section 4.9(b) hereof, or is entitled to be incurred pursuant to subsection (a) of this Section 4.9, the Company shall be permitted to classify such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.9. Indebtedness under Credit Facilities outstanding on the date on which Securities are first issued and authenticated under this Indenture will be deemed to have been incurred on such date in reliance on the exception provided by clause (i) of Section 4.9(b) hereof.
Appears in 1 contract
Sources: Indenture (Ribapharm Inc)
Incurrence of Indebtedness and Issuance of Preferred Stock. (a) The Company shall will not, and shall will not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guaranty guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "“incur"”) any Indebtedness (including Acquired Debt), and the Company will not issue any Disqualified Stock and will not permit any of its Restricted Subsidiaries to issue any shares of preferred stock; provided, however, that, so long as no Default or Event of Default has occurred and is continuing, that the Company and its any Restricted Subsidiaries Subsidiary may incur Indebtedness (including Acquired Debt) ), and the Company may issue Disqualified Stock, if the Fixed Charge Coverage Leverage Ratio of the Company for the Company's most recently ended four full fiscal quarters for which financial statements are available Reference Period immediately preceding the date on which such additional Indebtedness is incurred or such Disqualified Stock is issued would not have been at least 2.0 greater than 7.0 to 1, 1 determined on a pro forma basis (including a after giving pro forma effect to such incurrence or issuance and to the application of the net proceeds therefrom), as if ) and in accordance with the additional Indebtedness had been incurred at the beginning definition of such four-quarter period. Leverage Ratio.
(b) The foregoing provisions of Section 4.09(a) hereof will not apply to:prohibit the incurrence of any of the following items of Indebtedness (collectively, "Permitted Debt”):
(i1) the incurrence by the Company and any Restricted Subsidiary of Indebtedness under any Credit Facilities; provided that the aggregate principal amount of all Indebtedness of the Company and the Restricted Subsidiaries outstanding under any Credit Facilities after giving effect to such incurrence does not exceed an amount at any one time outstanding under this clause (1) (with letters of credit being deemed to have a principal amount equal to the maximum potential liability of the Company and its Restricted Subsidiaries thereunder) not to exceed $1.025 billion less the aggregate amount of all Net Proceeds of Asset Sales required to be applied by the Company or any of its Restricted Subsidiaries since the date of this Indenture to repay Indebtedness under the Credit Facilities pursuant to Section 4.10 hereof;
(2) the incurrence by the Company and its Restricted Subsidiaries of Indebtedness pursuant to the Bank Credit Facility in an aggregate principal amount not to exceed $50.0 million at any one time outstanding less any Net Proceeds of Asset Sales applied to permanently reduce the Bank Credit Facility pursuant to the provisions described in Section 4.10Existing Indebtedness;
(ii3) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;
(iii) the incurrence by the Company and its Restricted Subsidiaries Guarantors of Indebtedness represented by the Senior Subordinated Notes issued in the Offering and the related Note Guarantees and the Exchange Notes and the related Note Guarantees thereof by any Restricted Subsidiaries to be issued pursuant to the provisions in Section 12.01 hereofRegistration Rights Agreement;
(iv4) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case case, incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of the Company or such Restricted Subsidiary, in an aggregate principal amount not to exceed $5.0 20.0 million at any time outstanding;
(v5) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in connection with exchange for, or the acquisition net proceeds of assets which are used to refund, refinance or a new replace, Indebtedness of the Company or any of its Restricted Subsidiary; provided Subsidiaries or Disqualified Stock of the Company (other than intercompany Indebtedness) that such Indebtedness was permitted by this Indenture to be incurred by under Section 4.09(a) hereof or clauses (2), (3), (4) or (8) of this Section 4.09(b);
(6) the prior owner of such assets or such Restricted Subsidiary prior to such acquisition incurrence by the Company or one any of its Restricted Subsidiaries and was not incurred in connection with, or in contemplation of, such acquisition by the Company or one of it Restricted Subsidiaries; and provided further that the principal amount (or accreted value, as applicable) of such Indebtedness, together with any other outstanding Indebtedness incurred pursuant to this clause (v), does not exceed $5.0 million;
(vi) the incurrence of intercompany Indebtedness between or among the Company and any of its Wholly Owned Restricted Subsidiaries; provided, that however, that: (i) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Wholly Owned Restricted Subsidiary of the Company or and (ii) any sale or other transfer of any such Indebtedness to a Person that is neither not either the Company, Company or a Wholly Owned Restricted Subsidiary of the Company, shall be deemed deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be;
(vii) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Debt in exchange for, or the net proceeds of which are used to extend, refinance, renew, replace, defease or refund Indebtedness that was permitted by this Indenture to be incurred;
(viii) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt; provided, that if, and to the extent any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company.
(ix7) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations; provided that the agreements governing such Hedging Obligations that are incurred for do not increase the purpose Indebtedness of fixing the obligor outstanding at any time other than as a result of fluctuations in foreign currency exchange rates or hedging interest rate risk with respect to any floating rate indebtedness that is permitted rates or by reason of fees, indemnities and compensation payable thereunder;
(8) the guarantee (or co-issuance) by the terms Company or any of the Restricted Subsidiaries of Indebtedness of the Company or a Restricted Subsidiary of the Company that was permitted to be incurred by another provision of this Indenture Section 4.09; provided that if the Indebtedness being guaranteed (or co-issued) is subordinated in right of payment to or pari passu in right of payment with the Notes, then the applicable Guarantee (or co-issuance) shall be outstandingsubordinated in right of payment or pari passu in right of payment, as applicable, to the same extent as the Indebtedness guaranteed (or co-issued); and
(x9) the incurrence by the Company and or any of its Restricted Subsidiaries of additional Indebtedness in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, not to exceed $7.5 million at 50.0 million. For purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (1) through (9) above, or is entitled to be incurred pursuant to Section 4.09(a) hereof, the Company will be permitted to classify such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, in any time outstandingmanner that complies with this Section 4.09. The accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, the reclassification of preferred stock as Indebtedness due to a change in accounting principles, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock will not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09; provided, in each such case, that the amount of any such accrual, accretion or payment is included in the Cash Interest Expense of the Company to the extent paid in cash. Notwithstanding any other provision of this Section 4.09, the maximum amount of Indebtedness that the Company or any Restricted Subsidiary may incur pursuant to this Section 4.09 shall not be deemed to be exceeded solely as a result of fluctuations in exchange rates or currency values.
Appears in 1 contract
Sources: Indenture (Emmis Operating Co)
Incurrence of Indebtedness and Issuance of Preferred Stock. The Company shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guaranty guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") any Indebtedness (including Acquired Debt), and the Company shall not issue, and shall not permit any Guarantor to issue, any Disqualified Stock and shall not permit any of its Restricted Subsidiaries that are not Guarantors to issue any shares of preferred stock; provided, however, that, so long as no Default or Event of Default has occurred and is continuing, that the Company and its Restricted Subsidiaries any Guarantor may incur Indebtedness (including Acquired Debt) and the Company and any Guarantor may issue Disqualified Stock if the Fixed Charge Coverage Ratio for the Company's most recently ended four full fiscal quarters for which internal financial statements are available immediately preceding the date on which such additional Indebtedness is incurred or such Disqualified Stock is issued would have been at least 2.0 to 11.0, determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the additional Indebtedness had been incurred or Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period. The foregoing provisions will first paragraph of this covenant shall not apply toprohibit:
(i1) the incurrence by the Company or any Restricted Subsidiary of additional Indebtedness and its Restricted Subsidiaries letters of Indebtedness pursuant to the Bank credit under one or more Credit Facility Facilities in an aggregate principal amount not to exceed $50.0 million at any one time outstanding under this clause (1) (with letters of credit being deemed to have a principal amount equal to the maximum potential liability of the Company and its Restricted Subsidiaries thereunder) not to exceed $530.0 million, less any Net Proceeds the sum of Asset Sales applied all principal payments with respect to permanently reduce the Bank Credit Facility such Indebtedness pursuant to the provisions described in clause (A) of Section 4.10;
(ii2) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;
(iii3) the incurrence by the Company and its Restricted Subsidiaries the Guarantors of Indebtedness represented by the Senior Subordinated Notes (other than Additional Notes) and the related Subsidiary Guarantees and the Exchange Notes and the related Subsidiary Guarantees thereof by any Restricted Subsidiaries to be issued in exchange therefor pursuant to the provisions in Section 12.01 hereofregistration rights agreement;
(ivA) Indebtedness incurred to finance the purchase, improvement or construction of property, plant or equipment (including through the purchase of all of the Capital Stock of a Person) so long as such Indebtedness is secured by a Lien on the property, plant or equipment so purchased, improved or constructed and such Indebtedness does not exceed the value of such property, plant or equipment so purchased or constructed or the value of such improvements and such Lien shall not extend to or cover other assets of the Company or any of its Restricted Subsidiaries other than the property, plant or equipment so purchased, improved or constructed or the value of such improvements and the real property, if any, on which the property so constructed, improved or purchased, is situated and the accessions, attachments, replacements and improvements thereto or (B) Indebtedness incurred in connection with any lease financing transaction in conjunction with the acquisition of new property or improvements to existing property; provided that such lease financing transaction is consummated within 90 days of such acquisition and the aggregate of the Indebtedness incurred pursuant to clauses (A) and (B) does not exceed $15.0 million during any fiscal year (such amount is referred to as the "Maximum Amount"); provided that the Maximum Amount for each year shall be increased by the excess, if any, of (a) $30.0 million over (b) the amount of expenditures made in reliance on the provisions of this clause (4) for the immediately preceding two years;
(5) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness represented (other than intercompany Indebtedness) in exchange for, or the net proceeds of which are used to redeem, repurchase, retire, defease, or otherwise refund, refinance, or replace Indebtedness that was permitted by Capital Lease Obligationsthis Indenture to be incurred under the first paragraph of this covenant or clauses (2), mortgage financings (3), (4) or purchase money obligations, in each case incurred for the purpose (5) of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of the Company or such Restricted Subsidiary, in an aggregate principal amount not to exceed $5.0 million at any time outstandingthis paragraph;
(v6) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness in connection with the acquisition of assets or a new Restricted Subsidiary; provided that such Indebtedness was incurred by the prior owner of such assets or such Restricted Subsidiary prior to such acquisition by the Company or one of its Restricted Subsidiaries and was not incurred in connection with, or in contemplation of, such acquisition by the Company or one of it Restricted Subsidiaries; and provided further that the principal amount (or accreted value, as applicable) of such Indebtedness, together with any other outstanding Indebtedness incurred pursuant to this clause (v), does not exceed $5.0 million;
(vi) the incurrence of intercompany Indebtedness between or among the Company and any of its Wholly Owned Restricted Subsidiaries; provided, that however, that:
(a) if the Company or any Guarantor is the obligor on such Indebtedness, such Indebtedness must be expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, in the case of the Company, or the Subsidiary Guarantee, in the case of a Guarantor; and
(i) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Wholly Owned Restricted Subsidiary of the Company or Company, (ii) any sale or other transfer of any such Indebtedness to a Person that is neither the Company, or Company nor a Wholly Owned Restricted Subsidiary of the CompanyCompany or (iii) the designation of a Restricted Subsidiary that holds such Indebtedness as an Unrestricted Subsidiary, shall will be deemed deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be, that was not permitted by this clause (6);
(vii) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Debt in exchange for, or the net proceeds of which are used to extend, refinance, renew, replace, defease or refund Indebtedness that was permitted by this Indenture to be incurred;
(viii) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt; provided, that if, and to the extent any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company.
(ix7) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations Obligations;
(8) the guarantee by the Company or any of the Guarantors of Indebtedness of the Company or any Guarantor that was permitted to be incurred by another provision of this covenant;
(9) obligations incurred in the ordinary course of business under (a) bankers acceptances or trade letters of credit which are to be repaid in full not more than one year after the date on which such Indebtedness is originally incurred to finance the purchase of goods by the Company or a Restricted Subsidiary of the Company; (b) standby letters of credit issued for the purpose of fixing supporting (i) workers' compensation liabilities of the Company or hedging interest rate risk any of its Restricted Subsidiaries as required by law, (ii) obligations with respect to any floating rate indebtedness that is permitted by the terms leases of this Indenture to be outstanding; and
(x) the incurrence by the Company and or any of its Restricted Subsidiaries Subsidiaries, or (iii) performance, payment, deposit or surety obligations of additional the Company or any of its Restricted Subsidiaries; (c) performance bonds and surety bonds, and refinancings thereof; and (d) guarantees of Indebtedness incurred in the ordinary course of business of suppliers, licensees, franchisees, or customers in an aggregate amount not to exceed $7.5 5.0 million at any time outstanding;
(10) Indebtedness arising from the honoring by a bank or other financial institution of a check, draft or similar instrument drawn against insufficient funds in the ordinary course of business, provided, however, that such Indebtedness is extinguished within five business days of the Company or its applicable Restricted Subsidiary being advised of such incurrence;
(11) Indebtedness under guarantees in respect of obligations of joint ventures of the Company or any of its Restricted Subsidiaries in aggregate principal amount not to exceed $20.0 million at any one time;
(12) Indebtedness incurred in connection with any sale and leaseback transaction; provided that the aggregate of the Indebtedness incurred pursuant to this clause (12) shall not exceed $30.0 million at any time outstanding;
(13) Indebtedness to repurchase shares, or cancel options to purchase shares, of Equity Interests of the Company or any Restricted Subsidiary of the Company or any direct or indirect parent of the Company held by any then current or former director, officer or employee of, or consultant to, the Company or any of its Restricted Subsidiaries; provided that the aggregate of the Indebtedness incurred pursuant to this clause (13) shall not exceed $5.0 million in any fiscal year; provided that the amount available in any given fiscal year shall be increased by the excess, if any, of (i) $5.0 million over (ii) the amount used pursuant to this clause (13) in the immediately preceding two fiscal years;
(14) Indebtedness arising from any agreement providing for indemnities, guarantees, purchase price adjustments, holdbacks, contingency payment obligations based on the performance of the acquired or disposed assets or similar obligations (other than guarantees of Indebtedness) incurred by any Person in connection with the acquisition or disposition of assets;
(15) the incurrence by the Company or any of its Restricted Subsidiaries of Acquired Debt related to the acquisition of a Permitted Business if the Fixed Charge Coverage Ratio for the Company's most recently ended four full fiscal quarters for which internal financial statements are available immediately preceding the date of such incurrence of Acquired Debt (the "Relevant Fixed Charge Coverage Ratio") determined immediately after giving effect to such incurrence and the related acquisition (including through a merger, consolidation or otherwise) is higher than the Relevant Fixed Charge Coverage Ratio determined immediately before giving effect to such incurrence and the related acquisition;
(16) the issuance of any preferred stock by a Restricted Subsidiary of the Company to the Company or to any other wholly-owned Restricted Subsidiary of the Company; and
(17) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness or the issuance of Disqualified Stock or preferred stock of Restricted Subsidiaries in an aggregate principal amount (or accreted value, as applicable) at any time outstanding not to exceed $25.0 million. If any Non-Recourse Debt of an Unrestricted Subsidiary shall at any time cease to constitute Non-Recourse Debt or such Unrestricted Subsidiary shall be redesignated a Restricted Subsidiary, such event will be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary. For purposes of determining compliance with this Section 4.09:
(1) in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories described in clauses (1) through (17) above, or is entitled to be incurred pursuant to the first paragraph of this covenant, the Company will be permitted to classify (or later classify or reclassify in whole or in part in its sole discretion) such item of Indebtedness in any manner that complies with this covenant;
(2) the accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same, or less onerous, terms, the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock, the accrual of dividends on Disqualified Stock and the accretion of the liquidation preference of Disqualified Stock will not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this covenant; provided, in each such case, that the amount thereof is included in the Fixed Charges of the Company; and
(3) for the purposes of determining compliance with any dollar-denominated restriction on the incurrence of Indebtedness denominated in a foreign currency, the dollar-equivalent principal amount of such Indebtedness incurred pursuant thereto shall be calculated based on the relevant currency exchange rate in effect on the earlier of the date that such Indebtedness was incurred or the date that the Company or its applicable Restricted Subsidiary committed to incur such Indebtedness.
Appears in 1 contract
Sources: Indenture (K&f Industries Inc)
Incurrence of Indebtedness and Issuance of Preferred Stock. The Company shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guaranty guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") any Indebtedness (including Acquired Debt); provided) and the Company shall not issue any Disqualified Stock and shall not permit any of its Restricted Subsidiaries to issue any shares of Disqualified Stock or Preferred Stock, howeverprovided that the Company or any of its Restricted Subsidiaries may incur Indebtedness, thatthe Company may issue Disqualified Stock and subject to the final paragraph of this covenant below, so long as no Default or Event Restricted Subsidiaries of Default has occurred and is continuing, the Company may incur Preferred Stock if the Leverage Ratio of the Company and its Restricted Subsidiaries may incur Indebtedness (including Acquired Debt) if the Fixed Charge Coverage Ratio for the Company's most recently ended four full fiscal quarters for which financial statements are available immediately preceding the date on which such additional Indebtedness is incurred would have been at least 2.0 not greater than 5.5 to 1, 1.0 determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the additional Indebtedness had been incurred incurred, or the Disqualified Stock or Preferred Stock had been issued, as the case may be, at the beginning of such four-quarter periodthe most recently ended fiscal quarter. The foregoing provisions will So long as no Default shall have occurred and be continuing or would be caused thereby, the first paragraph of this covenant shall not apply to:
prohibit the incurrence of any of the following items of Indebtedness (i) collectively, "Permitted Debt"): the incurrence by the Company and its Restricted Subsidiaries of Indebtedness pursuant to under the Bank Credit Facility in an Facilities; provided that the aggregate principal amount of all Indebtedness of the Company and its Restricted Subsidiaries outstanding under this clause (1) for all Credit Facilities of the Company and its Restricted Subsidiaries after giving effect to such incurrence does not exceed an amount equal to exceed $50.0 million at any one time outstanding 9.75 billion less any the aggregate amount of all Net Proceeds of from Asset Sales applied by the Company or any of its Restricted Subsidiaries to permanently reduce the Bank repay Indebtedness under a Credit Facility pursuant to the provisions described in Section 4.10;
(ii) 4.11. the incurrence by the Company and its Restricted Subsidiaries of Existing Indebtedness (other than under the Existing Indebtedness;
(iii) Credit Facilities); the incurrence on the Issue Date by the Company and its Restricted Subsidiaries of Indebtedness represented by the Senior Subordinated Notes and the Guarantees thereof by (other than any Restricted Subsidiaries pursuant to the provisions in Section 12.01 hereof;
(iv) Additional Notes); the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case case, incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement (including, without limitation, the cost of propertydesign, plant or equipment used in the business development, construction, acquisition, transportation, installation, improvement, and migration) of Productive Assets of the Company or such any of its Restricted SubsidiarySubsidiaries, in an aggregate principal amount not to exceed $5.0 75 million at any time outstanding;
outstanding pursuant to this clause (v) 4); the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in connection with exchange for, or the acquisition net proceeds of assets which are used to refund, refinance or a new Restricted Subsidiaryreplace, in whole or in part, Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture to be incurred under this clause (5), the first paragraph of this covenant or clauses (2) or (3) of this paragraph; provided that such Indebtedness was incurred by the prior owner of such assets or such Restricted Subsidiary prior to such acquisition incurrence by the Company or one any of its Restricted Subsidiaries and was not incurred in connection with, or in contemplation of, such acquisition by the Company or one of it Restricted Subsidiaries; and provided further that the principal amount (or accreted value, as applicable) of such Indebtedness, together with any other outstanding Indebtedness incurred pursuant to this clause (v), does not exceed $5.0 million;
(vi) the incurrence of intercompany Indebtedness between or among the Company and any of its Wholly Owned Restricted Subsidiaries; providedprovided that: if the Company is the obligor on such Indebtedness, that such Indebtedness must be expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes; and
(i) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Wholly Owned Restricted Subsidiary of the Company or thereof and (ii) any sale or other transfer of any such Indebtedness to a Person that is neither not either the Company, Company or a Wholly Owned Restricted Subsidiary of the Companythereof, shall be deemed deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be;
(vii) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Debt in exchange for, or the net proceeds of which are used to extend, refinance, renew, replace, defease or refund Indebtedness that was not permitted by this Indenture to be incurred;
clause (viii) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt6); provided, that if, and to the extent any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company.
(ix) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk with respect to any floating rate indebtedness Indebtedness that is permitted by the terms of this Indenture to be outstanding; and
(x) the guarantee by the Company or any of its Restricted Subsidiaries of Indebtedness of a Restricted Subsidiary of the Company that was permitted to be incurred by another provision of this Section 4.10; the incurrence by the Company and or any of its Restricted Subsidiaries of additional Indebtedness in an aggregate principal amount at any time outstanding under this clause (9), not to exceed $7.5 million at 300 million; and the accretion or amortization of original issue discount and the write up of Indebtedness in accordance with purchase accounting. For purposes of determining compliance with this Section 4.10, any Indebtedness under Credit Facilities outstanding on the Issue Date shall be deemed to have been incurred pursuant to clause (1) above and, in the event that an item of proposed Indebtedness (other than any Indebtedness initially deemed on the Issue Date to be incurred under clause (1) above) (a) meets the criteria of more than one of the categories of Permitted Debt described in clauses (1) through (10) above or (b) is entitled to be incurred pursuant to the first paragraph of this covenant, the Company shall be permitted to classify and from time outstandingto time to reclassify such item of Indebtedness in any manner that complies with this covenant. Once any item of Indebtedness is so reclassified, it shall no longer be deemed outstanding under the category of Permitted Debt, where initially incurred or previously reclassified. For avoidance of doubt, Indebtedness incurred pursuant to a single agreement, instrument, program, facility or line of credit may be classified as Indebtedness arising in part under one of the clauses listed above or under the first paragraph of this covenant, and in part under any one or more of the clauses listed above, to the extent that such Indebtedness satisfies the criteria for such classification.
Appears in 1 contract
Incurrence of Indebtedness and Issuance of Preferred Stock. The Company shall not, and shall not permit any of its Subsidiaries to, directly or indirectly, create, incur, issue, assume, guaranty guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") any Indebtedness (including Acquired Debt), and the Company shall not issue any Disqualified Stock and shall not permit any of its Subsidiaries to issue any shares of preferred stock; provided, however, that, so long as no Default or Event of Default has occurred and is continuing, that the Company and its Restricted Subsidiaries may incur Indebtedness (including Acquired Debt) or issue Disqualified Stock, if the Fixed Charge Coverage Ratio for the Company's most recently ended four full fiscal quarters for which internal financial statements are available immediately preceding the date on which such additional Indebtedness is incurred or such Disqualified Stock is issued would have been at least 2.0 to 1, determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the additional Indebtedness had been incurred or the Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period. The foregoing provisions will first paragraph of this Section 4.09 shall not apply to:prohibit the incurrence of any of the following items of Indebtedness (collectively, "Permitted Debt"):
(i) the incurrence by the Company of additional Indebtedness and its Restricted Subsidiaries letters of Indebtedness pursuant to the Bank credit under Credit Facility Facilities in an aggregate principal amount not to exceed $50.0 million at any one time outstanding less any Net Proceeds under this clause (i) (with letters of Asset Sales applied credit being deemed to permanently reduce the Bank Credit Facility pursuant have a principal amount equal to the provisions described in Section 4.10maximum potential liability of the Company and its Restricted Subsidiaries thereunder) not to exceed $600.0 million;
(ii) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;
(iii) the incurrence by the Company and its Restricted Subsidiaries of Indebtedness represented by the Senior Subordinated Notes to be issued on the date of this Indenture and the Guarantees thereof by any Restricted Subsidiaries Exchange Notes to be issued pursuant to the provisions in Section 12.01 hereofRegistration Rights Agreement;
(iv) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case case, incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of the Company or such Restricted Subsidiary, in an aggregate principal amount amount, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (iv), not to exceed $5.0 100.0 million at any time outstanding;
(v) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness in connection with the acquisition of assets or a new Restricted Subsidiary; provided that such Indebtedness was incurred by the prior owner of such assets or such Restricted Subsidiary prior to such acquisition by the Company or one of its Restricted Subsidiaries and was not incurred in connection with, or in contemplation of, such acquisition by the Company or one of it Restricted Subsidiaries; and provided further that the principal amount (or accreted value, as applicable) of such Indebtedness, together with any other outstanding Indebtedness incurred pursuant to this clause (v), does not exceed $5.0 million;
(vi) the incurrence of intercompany Indebtedness between or among the Company and any of its Wholly Owned Restricted Subsidiaries; provided, that any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Wholly Owned Restricted Subsidiary of the Company or any sale or other transfer of any such Indebtedness to a Person that is neither the Company, or a Wholly Owned Restricted Subsidiary of the Company, shall be deemed to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be;
(vii) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Debt Indebtedness in exchange for, or the net proceeds of which are used to extendrefund, refinance, renew, replace, defease refinance or refund replace Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture to be incurred;
(viii) incurred under the incurrence by the Company's Unrestricted Subsidiaries first paragraph of Non-Recourse Debt; provided, that if, and to the extent any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company.
(ix) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk with respect to any floating rate indebtedness that is permitted by the terms of this Indenture to be outstanding; and
(x) the incurrence by the Company and its Restricted Subsidiaries of additional Indebtedness in an aggregate amount not to exceed $7.5 million at any time outstanding.this
Appears in 1 contract
Sources: Indenture (Office Depot Inc)
Incurrence of Indebtedness and Issuance of Preferred Stock. The Company shall not, and shall not permit any of its Subsidiaries to, directly or indirectly, create, incur, issue, assume, guaranty guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incurINCUR") any Indebtedness (including Acquired Debt)Indebtedness) and the Company shall not issue any Disqualified Stock and shall not permit any of its Subsidiaries to issue any shares of preferred stock; provided, however, that, so long as no Default or Event of Default has occurred and is continuing, that the Company and its Restricted Subsidiaries may incur Indebtedness (including Acquired DebtIndebtedness) if or issue shares of Disqualified Stock and the Company's Subsidiaries that are Subsidiary Guarantors may incur Indebtedness if: (i) the Fixed Charge Coverage Ratio for the Company's most recently ended four full fiscal quarters for which internal financial statements are available immediately preceding the date on which such additional Indebtedness is incurred or such Disqualified Stock is issued would have been at least 2.0 to 1, determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the additional Indebtedness had been incurred incurred, or the Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period; and (ii) no Default or Event of Default shall have occurred and be continuing or would occur as a consequence thereof; provided, that no Guarantee may be incurred pursuant to this paragraph unless the guaranteed Indebtedness is incurred by the Company or a Subsidiary Guarantor pursuant to this paragraph. The foregoing provisions will shall not apply to:
(i) the incurrence by the Company of New Senior Debt (and its Restricted Guarantees thereof by Subsidiaries of Indebtedness pursuant to the Bank Credit Facility that are Subsidiary Guarantors) in an aggregate principal amount at any time outstanding (with letters of credit obligations being deemed to have a principal amount equal to the maximum potential liability of the Company and its Subsidiaries that are Subsidiary Guarantors with respect thereto) not to exceed an amount equal to $50.0 million at any one time outstanding less any Net Proceeds of Asset Sales applied to permanently reduce the Bank Credit Facility pursuant to the provisions described in Section 4.1045,000,000;
(ii) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;
(iii) the incurrence by the Company and its Restricted Subsidiaries of Indebtedness represented by the Senior Subordinated Notes and by the Guarantees thereof Subsidiary Guarantors of Indebtedness represented by any Restricted Subsidiaries pursuant to the provisions in Section 12.01 hereofSubsidiary Guarantees;
(iv) the incurrence by the Company or any of its Restricted Subsidiaries [OR ANY OF ITS SUBSIDIARIES] of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligationsPurchase Money Obligations, in each case incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of the Company or such Restricted Subsidiary, in an aggregate principal amount not to exceed $5.0 million at any time outstanding;
(v) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness in connection with the acquisition of assets or a new Restricted Subsidiary; provided that such Indebtedness was incurred by the prior owner of such assets or such Restricted Subsidiary prior to such acquisition by the Company or one of its Restricted Subsidiaries and was not incurred in connection with, or in contemplation of, such acquisition by the Company or one of it Restricted Subsidiaries; and provided further that the principal amount (or accreted value, as applicable) of such Indebtedness, together with any other outstanding Indebtedness incurred pursuant to this clause (v), does not exceed $5.0 million;
(vi) the incurrence of intercompany Indebtedness between or among the Company and any of its Wholly Owned Restricted Subsidiaries; provided, that any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Wholly Owned Restricted Subsidiary of the Company or any sale or other transfer of any such Indebtedness to a Person that is neither the Company, or a Wholly Owned Restricted Subsidiary of the Company, shall be deemed to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be;
(vii) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Debt in exchange for, or the net proceeds of which are used to extend, refinance, renew, replace, defease or refund Indebtedness that was permitted by this Indenture to be incurred;
(viii) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt; provided, that if, and to the extent any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company.
(ix) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk with respect to any floating rate indebtedness that is permitted by the terms of this Indenture to be outstanding; and
(x) the incurrence by the Company and its Restricted Subsidiaries of additional Indebtedness in an aggregate amount not to exceed $7.5 million at any time outstanding.financing
Appears in 1 contract
Sources: Indenture (RBX Corp)
Incurrence of Indebtedness and Issuance of Preferred Stock. The Company shall not, and shall not permit any of its Subsidiaries to, directly or indirectly, create, incur, issue, assume, guaranty or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") Incur any Indebtedness (including Acquired Debt); provided, however, that, so long as no Default or Event of Default has occurred ) and is continuing, the Company and its any Guaranteeing Subsidiary will not issue any Disqualified Stock and will not permit any of their respective Restricted Subsidiaries that are not Guaranteeing Subsidiaries to issue any shares of preferred stock; PROVIDED, HOWEVER, that the Company and any Guaranteeing Subsidiary may incur Incur Indebtedness (including Acquired Debt) or issue shares of Disqualified Stock, if the Fixed Charge Coverage Ratio for the Company's most recently ended four full fiscal quarters for which internal financial statements are available immediately preceding the date on which such additional Indebtedness is incurred or such Disqualified Stock is issued would have been at least 2.0 (x) 2.25 to 1 if such incurrence or issuance occurs on or before December 1, 1999, or (y) 2.5 to 1 if such incurrence or issuance occurs at any time thereafter, in each case, determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the additional Indebtedness had been incurred incurred, or the Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period. The foregoing provisions will not apply to:
to any of the following (each and all of which (1) may be issued or incurred, (2) constitutes an independent exception to the foregoing provisions and (3) may be incurred in addition to any other Indebtedness permitted to be incurred under any other exception): (i) the incurrence by the Company and its Restricted Subsidiaries or any Guaranteeing Subsidiary of Indebtedness and letters of credit pursuant to the Bank any New Credit Facility (with letters of credit being deemed to have a principal amount equal to the maximum potential liability of the Company or the relevant Guaranteeing Subsidiary thereunder) in an aggregate principal amount outstanding at any one time not to exceed $50.0 265.0 million at (A) LESS the aggregate amount of all mandatory repayments (a "Mandatory Repayment") of the principal of any one time outstanding less term Indebtedness under the New Credit Facility that have been made since the date of the Indenture pursuant to the amortization schedule of any New Credit Facility (other than any Mandatory Repayment made concurrently with refinancing or refunding of the New Credit Facility), (B) PLUS the Excess Amount and (C) LESS the aggregate amount of all Net Proceeds of Asset Sales applied pursuant to clause (b) or (c) of the first sentence of the second paragraph under Section 4.10 hereof to permanently reduce Indebtedness (and, in the Bank case of revolving Indebtedness, the commitments) under the New Credit Facility or to cash collateralize letters of credit and permanently reduce commitments with respect to revolving Indebtedness under the New Credit Facility; PROVIDED that the amount of Indebtedness permitted to be incurred pursuant to the provisions described New Credit Facility in Section 4.10;
accordance with this clause (i) shall be in addition to any Indebtedness permitted to be incurred pursuant to the New Credit Facility or otherwise in reliance on, and in accordance with, clause (ix) of this paragraph; (ii) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;
(iii) the incurrence by the Company and its Restricted Subsidiaries any Guaranteeing Subsidiary of Indebtedness represented by the Senior Subordinated Notes and the Guarantees thereof by any Restricted Subsidiaries pursuant to the provisions in Section 12.01 hereof;
Subsidiary Guarantee; (iviii) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness (A) represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case case, incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment property used in the business of the Company or such Restricted SubsidiarySubsidiary or (B) in connection with sale and leaseback transactions, in an aggregate principal amount with respect to this clause (iii) not to exceed $20.0 million at any time outstanding; PROVIDED THAT in no event shall the aggregate principal amount of Indebtedness incurred pursuant to clause (iii)(B) exceed $5.0 million at any time outstanding;
; (iv) Existing Indebtedness; (v) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in connection with exchange for, or the acquisition net proceeds of assets which are used to extend, refinance, renew, replace, defease or a new Restricted Subsidiary; provided refund, Indebtedness that such Indebtedness was incurred permitted by the prior owner of such assets or such Restricted Subsidiary prior to such acquisition by the Company or one of its Restricted Subsidiaries and was not incurred in connection with, or in contemplation of, such acquisition by the Company or one of it Restricted SubsidiariesIndenture; and provided further that the principal amount (or accreted value, as applicable) of such Indebtedness, together with any other outstanding Indebtedness incurred pursuant to this clause (v), does not exceed $5.0 million;
(vi) the incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness between or among the Company and any of its Wholly Owned Restricted Subsidiaries; providedPROVIDED, HOWEVER, that (a) any subsequent issuance or transfer (other than for security purposes) of Equity Interests and (b) any subsequent sale or other transfer (including for security purposes other than to secure Indebtedness permitted to be incurred pursuant to clause (i) of this paragraph) of such Indebtedness, in each case, that results in any such Indebtedness being held by a Person other than the Company or a Wholly Owned any of its Restricted Subsidiary of the Company or any sale or other transfer of any such Indebtedness to a Person that is neither the Company, or a Wholly Owned Restricted Subsidiary of the Company, Subsidiaries shall be deemed to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be;
, not permitted pursuant to this clause (vi); (vii) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Debt in exchange for, Hedging Obligations that are incurred for the purpose of fixing or the net proceeds hedging (a) interest rate risk with respect to any floating rate Indebtedness of which are used to extend, refinance, renew, replace, defease or refund such Person so long as such floating rate Indebtedness that was is permitted by this the terms of the Indenture to be incurred;
outstanding or (b) exchange rate risk with respect to agreements or indebtedness of such Person payable or denominated in a currency other than U.S. dollars; (viii) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt; providedPROVIDED, HOWEVER, that if, and to the extent if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company.
; (ix) the incurrence by the Company or and any Guaranteeing Subsidiary of its Restricted Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk with respect Indebtedness in an aggregate principal amount at any time outstanding not to any floating rate indebtedness that is permitted by the terms of this Indenture to be outstandingexceed $25.0 million; and
(x) the incurrence by any Foreign Subsidiary of Indebtedness and letters of credit to fund working capital and capital expenditure requirements (with letters of credit being deemed to have a principal amount equal to the Company and its Restricted Subsidiaries maximum potential liability of additional Indebtedness such Foreign Subsidiary thereunder) in an aggregate maximum principal amount outstanding at any one time not to exceed $15.0 million; (xi) Obligations in respect of performance and surety bonds provided by the Company or any Guaranteeing Subsidiary in the ordinary course of business; and (xii) the incurrence or issuance by any Restricted Subsidiary of the Company of Indebtedness or preferred stock (in addition to Indebtedness and preferred stock that may be incurred or issued pursuant to any other clause of this paragraph) in an aggregate principal amount not to exceed $7.5 million at any time outstanding1.0 million.
Appears in 1 contract
Sources: Indenture (Advanced Medical Inc)
Incurrence of Indebtedness and Issuance of Preferred Stock. The Company shall will not, and shall will not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guaranty guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incurINCUR") any Indebtedness (including Acquired Debt); provided, however, that, so long as no Default or Event of Default has occurred and is continuing, the Company will not issue any Disqualified Stock, and the Company will not permit any of its Restricted Subsidiaries to issue any Disqualified Stock or preferred stock; PROVIDED, HOWEVER, that the Company may incur Indebtedness (including Acquired Debt) ), if the Fixed Charge Coverage Ratio for the Company's most recently ended four full fiscal quarters for which internal financial statements are available immediately preceding the date on which such additional Indebtedness is incurred would have been at least 2.0 2.00 to 11 prior to December 31, 2004 and 2.25 to 1 thereafter, determined in each case on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the additional Indebtedness had been incurred at the beginning of such four-quarter period. The foregoing provisions So long as no Default shall have occurred and be continuing or would be caused thereby, the first paragraph of this Section 4.09 will not apply to:prohibit the incurrence of any of the following items of Indebtedness (collectively, "PERMITTED DEBT"):
(i1) the incurrence by the Company of Indebtedness under the Credit Agreement (and the incurrence by the Guarantors of guarantees thereof) in an aggregate principal amount at any one time outstanding (with letters of credit being deemed to have a principal amount equal to the maximum potential liability of the Company and its Restricted Subsidiaries thereunder) not to exceed $50.0 million, LESS the aggregate amount of all Net Proceeds of Asset Sales applied by the Company or any Restricted Subsidiary to repay any term Indebtedness under the Credit Agreement (and, in the case of any revolving credit Indebtedness under the Credit Agreement, to effect a corresponding commitment reduction thereunder) pursuant to Section 4.10 hereof;
(2) the incurrence by the Company and its Restricted Subsidiaries the Guarantors of Indebtedness represented by the Notes and the related Subsidiary Guarantees to be issued on the date hereof and the Exchange Notes and the related Subsidiary Guarantees to be issued pursuant to the Bank Credit Facility in an aggregate principal amount not to exceed $50.0 million at any one time outstanding less any Net Proceeds of Asset Sales applied to permanently reduce the Bank Credit Facility pursuant to the provisions described in Section 4.10Registration Rights Agreement;
(ii3) the incurrence by the Company and its Restricted Subsidiaries or any of the Existing Guarantors of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to refund, refinance or replace Indebtedness (other than intercompany Indebtedness;) permitted to be incurred under the first paragraph of this Section 4.09 or clauses (2) or (3) of this paragraph; 51
(iii) the incurrence by the Company and its Restricted Subsidiaries of Indebtedness represented by the Senior Subordinated Notes and the Guarantees thereof by any Restricted Subsidiaries pursuant to the provisions in Section 12.01 hereof;
(iv4) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of the Company or such Restricted Subsidiary, in an aggregate principal amount not to exceed $5.0 million at any time outstanding;
(v) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness in connection with the acquisition of assets or a new Restricted Subsidiary; provided that such Indebtedness was incurred by the prior owner of such assets or such Restricted Subsidiary prior to such acquisition by the Company or one of its Restricted Subsidiaries and was not incurred in connection with, or in contemplation of, such acquisition by the Company or one of it Restricted Subsidiaries; and provided further that the principal amount (or accreted value, as applicable) of such Indebtedness, together with any other outstanding Indebtedness incurred pursuant to this clause (v), does not exceed $5.0 million;
(vi) the incurrence of intercompany Indebtedness between or among the Company and any of its Wholly Owned Restricted Subsidiaries; providedPROVIDED, that HOWEVER, that:
(a) if the Company or any Guarantor is the obligor on such Indebtedness, such Indebtedness must be expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, in the case of the Company, or the Subsidiary Guarantee, in the case of a Guarantor; and
(b) (i) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Wholly Owned Restricted Subsidiary of the Company or thereof and (ii) any sale or other transfer of any such Indebtedness to a Person that is neither not either the Company, Company or a Wholly Owned Restricted Subsidiary of the Companythereof, shall be deemed deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be, that was not permitted by this clause (4);
(vii) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Debt in exchange for, or the net proceeds of which are used to extend, refinance, renew, replace, defease or refund Indebtedness that was permitted by this Indenture to be incurred;
(viii) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt; provided, that if, and to the extent any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company.
(ix5) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk with respect to any floating rate indebtedness Indebtedness that is permitted by the terms of this Indenture to be outstanding;
(6) the guarantee by the Company or any of the Guarantors of Indebtedness of the Company or a Restricted Subsidiary that was permitted to be incurred by another provision of this Section 4.09;
(7) the accrual of interest, the accretion or amortization of original issue discount and the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms will not be deemed to be an incurrence of Indebtedness for the purposes of this Section 4.09; PROVIDED, in each such case, that the amount thereof is included in Fixed Charges of the Company as accrued; and
(x) 8) the incurrence by the Company and its Restricted Subsidiaries of additional Indebtedness in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, not to exceed $7.5 million at 10.0 million. For the purposes of determining compliance with this Section 4.09, in the event that any time outstandingproposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (1) through (8) above, or is entitled to be incurred pursuant to the first paragraph of this Section 4.09, the Company will be permitted to classify such item of Indebtedness on the date of its incurrence in any manner that complies with this Section 4.09.
Appears in 1 contract
Sources: Indenture (Wdra Food Service Inc)
Incurrence of Indebtedness and Issuance of Preferred Stock. The Company shall will not, and shall will not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guaranty guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") any Indebtedness (including Acquired Debt)) and the Company shall not issue any Disqualified Stock and shall not permit any of its Restricted Subsidiaries to issue any shares of preferred stock; provided, however, that, so long as no Default or Event of Default has occurred and is continuing, that the Company and its Restricted Subsidiaries may incur Indebtedness (including Acquired Debt) and issue shares of Disqualified Stock and any Restricted Subsidiary may incur Acquired Debt if (i) the Company's Fixed Charge Coverage Ratio for the Company's most recently ended four full fiscal quarters for which financial statements are available immediately preceding the date on which such additional Indebtedness is incurred or such Disqualified Stock is issued would have been at least 2.0 2.75 to 1, determined on a pro forma basis (including a pro forma application of the net proceeds therefrom)basis, as if the additional Indebtedness had been incurred incurred, or the Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter periodperiod and (ii) the Company is in compliance with Section 4.4 hereof. The foregoing provisions will of the first paragraph of this covenant shall not apply toto the incurrence of any of the following items of Indebtedness (collectively, "Permitted Debt") so long as no Default has occurred and is continuing or would be caused thereby:
(i) the incurrence by the Company and or its Restricted Subsidiaries of Indebtedness pursuant under the Senior Credit Facility and letters of credit (with letters of credit being deemed to have a principal amount equal to the Bank Credit Facility in an maximum potential liability of the Company and its Restricted Subsidiaries thereunder); provided that the sum of the aggregate principal amount of all Indebtedness of the Company and its Restricted Subsidiaries outstanding under the Senior Credit Facility after giving effect to such incurrence, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any other Indebtedness incurred pursuant to this clause (i) does not exceed an amount equal to exceed $50.0 125.0 million at less, without duplication, (X) the aggregate amount of all repayments, optional or mandatory, of the principal of any one time Indebtedness under the term loan portion of the Senior Credit Facility that have been made by the Company and its Restricted Subsidiaries since the Issue Date, (Y) the aggregate amount of PIK Securities issued and outstanding less any Net Proceeds pursuant to this Indenture to a maximum amount equal to the Minimum Cash Flow Participation Amount, and (Z) the aggregate amount of Asset Sales Sale proceeds applied by the Company and its Restricted Subsidiaries to permanently reduce the Bank availability of revolving credit Indebtedness under the Senior Credit Facility pursuant to Section 4.12; it being understood that the provisions described total committed facilities with respect to any refinancing of the Senior Credit Facility may exceed the actual aggregate principal amount of Indebtedness outstanding at the time of such refinancing so long as the total of such commitments does not exceed the limitations set forth in Section 4.10this clause (i);
(ii) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;
(iii) the incurrence by the Company and its Restricted Subsidiaries of Indebtedness represented by the Senior Subordinated Notes Securities and the Guarantees thereof by any Restricted Subsidiaries PIK Securities issued pursuant to this Indenture and the provisions in Section 12.01 hereofincurrence by the Subsidiary Guarantors of the Guarantees;
(iviii) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of the Company or such Restricted Subsidiary, in an aggregate principal amount amount, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace Indebtedness incurred pursuant to this clause (iii), not to exceed $5.0 million at any time outstanding;
(viv) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness in connection with Permitted Refinancing Indebtedness;
(v) the acquisition of assets or a new Restricted Subsidiary; provided that such Indebtedness was incurred incurrence by the prior owner Company of such assets or such Indebtedness owing to and held by any Restricted Subsidiary prior or Indebtedness of a Restricted Subsidiary which is a Subsidiary Guarantor owing to such acquisition and held by the Company or one of its another Restricted Subsidiaries and was not incurred in connection withSubsidiary which is a Subsidiary Guarantor; provided, or in contemplation ofhowever, such acquisition by that (a) if the Company or one of it Restricted Subsidiaries; and provided further that is the principal amount (or accreted value, as applicable) of obligor on such Indebtedness, together such Indebtedness is expressly subordinated to the prior payment in full in cash of all Obligations with any other outstanding respect to the Securities and this Indenture, (b) if a Restricted Subsidiary of the Company is the obligor on such Indebtedness, such Indebtedness incurred pursuant is expressly subordinated to this clause the prior payment in full in cash of such Restricted Subsidiary's Guarantee and (vc), does not exceed $5.0 million;
(vi1) the incurrence of intercompany Indebtedness between or among the Company and any of its Wholly Owned Restricted Subsidiaries; provided, that any subsequent event or issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Wholly Owned Restricted Subsidiary of the Company or and (2) any sale or other transfer of any such Indebtedness to a Person that is neither not either the Company, Company or a Wholly Owned Restricted Subsidiary of the Company, Guarantor shall be deemed deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be, that was not permitted by this clause (v);
(vii) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Debt in exchange for, or the net proceeds of which are used to extend, refinance, renew, replace, defease or refund Indebtedness that was permitted by this Indenture to be incurred;
(viii) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt; provided, that if, and to the extent any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company.
(ixvi) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are incurred in the normal course of business and consistent with past business practices for the purpose of fixing or hedging currency, commodity or interest rate risk (including with respect to any floating rate indebtedness Indebtedness that is permitted by the terms of this Indenture to be outstandingoutstanding in connection with the conduct of their respective businesses and not for speculative purposes);
(vii) the guarantee by the Company or any of the Subsidiary Guarantors of Indebtedness of the Company or a Restricted Subsidiary of the Company that was permitted to be incurred by another provision of this Section 4.3;
(viii) the incurrence by Trim Trends Canada of Indebtedness under the CIBC Facility, provided that the aggregate principal amount of all Indebtedness of Trim Trends Canada outstanding under the CIBC Facility, after giving effect to such incurrence, including all permitted Refinancing Indebtedness incurred to refund, refinance or replace any other Indebtedness incurred pursuant to this clause (viii), does not exceed an amount equal to $2.0 million; and
(xix) the incurrence by the Company and its Restricted Subsidiaries of additional Indebtedness in an aggregate principal amount at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any other Indebtedness incurred pursuant to this clause (ix), not to exceed $7.5 million at 2.5 million. For purposes of determining compliance with this Section 4.3, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (i) through (ix) above as of the date of incurrence thereof or is entitled to be incurred pursuant to the first paragraph of this covenant as of the date of incurrence thereof, the Company shall, in its sole discretion, classify such item of Indebtedness as of the date of incurrence thereof in any time outstandingmanner that complies with this covenant and such item of Indebtedness shall be treated as having been incurred pursuant to only one of such clauses or pursuant to the first paragraph hereof. Accrual of interest, accrual of dividends, the accretion of accreted value and the payment of interest in the form of additional Indebtedness will not be deemed to be an incurrence of Indebtedness for purposes of this covenant.
Appears in 1 contract
Sources: Indenture (Harvard Industries Inc)
Incurrence of Indebtedness and Issuance of Preferred Stock. (a) The Company shall not, and shall not permit any of its Subsidiaries to, directly or indirectly, create, incur, issue, assume, guaranty Guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "“incur"”) any Indebtedness (including Acquired Debt)) and the Company shall not issue any Disqualified Stock and shall not permit any of its Subsidiaries to issue any shares of preferred stock; provided, however, that, so long as no Default or Event of Default has occurred and is continuing, that the Company and its Restricted Subsidiaries DFG may incur Indebtedness (including Acquired Debt), and the Guarantors may guarantee such Indebtedness of DFG, and the Company and DFG may issue shares of Disqualified Stock, if (i) if the Fixed Charge Coverage Ratio for the Company's ’s most recently ended four full fiscal quarters for which internal financial statements are available immediately preceding the date on which such additional Indebtedness is incurred or such Disqualified Stock is issued (in either case, the “Incurrence Date”) would have been at least 2.0 1.5 to 1 and (ii) the ratio (the “Debt Ratio”) of (A) the aggregate principal amount of consolidated Indebtedness of the Company and its Subsidiaries outstanding as of the date of the Company’s most recently ended fiscal quarter for which internal financial statements are available immediately preceding the Incurrence Date to (B) the Consolidated Cash Flow of the Company for the Company’s most recently ended four full fiscal quarters for which internal financial statements are available immediately preceding the Incurrence Date would have been less than 5.0 to 1; provided, determined however, that for the purposes of calculating the aggregate principal amount of consolidated Indebtedness of the Company and its Subsidiaries as of any date (i) the aggregate principal amount of the outstanding Notes as of such date shall be deemed to be the principal amount thereof as of such date and (ii) the aggregate principal amount of the Indebtedness outstanding under any revolving credit facility as of such date shall be deemed to be the daily average amounts outstanding thereunder during the three months ending on such date. Each of the foregoing ratios shall be calculated on a pro forma basis giving effect to (including a pro forma i)(A) the incurrence of the Indebtedness or issuance of the Disqualified Stock giving rise to such calculation, (B) any other incurrence of Indebtedness (other than revolving credit borrowings) or issuance of Disqualified Stock subsequent to the commencement of the four-quarter reference period and (C) in each such case, the application of the net proceeds therefrom), therefrom as if the additional Indebtedness such incurrence, issuance and application had been incurred occurred at the beginning of the four-quarter reference period and (ii) any acquisitions that have been made by the Company or any of its Subsidiaries, including through mergers or consolidations and including any related financing transactions, during such four-quarter reference period or subsequent thereto and prior to the Calculation Date as if they occurred on the first day of such four-quarter reference period. In addition, the Consolidated Cash Flow for any such four-quarter reference period shall be calculated (i) to include the Consolidated Cash Flow of the acquired entities (adjusted to include any expense or cost reductions for which pro forma treatment would be permitted under Article 11 of Regulation S-X promulgated under the Securities Act as of the date of this Agreement), (ii) without giving effect to clause (iii) of the proviso set forth in the definition of Consolidated Net Income and (iii) to exclude the Consolidated Cash Flow attributable to discontinued operations, as determined in accordance with GAAP, and to operations or businesses disposed of prior to the Calculation Date. In calculating the Fixed Charges as of any Calculation Date, the Fixed Charges attributable to discontinued operations, as determined in accordance with GAAP, and to operations or businesses disposed of prior to the Calculation Date shall be excluded, but only to the extent that the obligations giving rise to such Fixed Charges will not be obligations of the referent Person or any of its Subsidiaries following the Calculation Date.
(b) The foregoing provisions will shall not apply to:
to (i) the incurrence by DFG (and Guarantees thereof by the Company and the Guarantors) of Indebtedness for working capital purposes and letters of credit pursuant to the Credit Agreement (with letters of credit being deemed to have a principal amount equal to the maximum potential liability of the Company and its Restricted Subsidiaries of Indebtedness pursuant to the Bank Credit Facility thereunder) in an aggregate principal amount not to exceed as of any date of incurrence the lesser of (1) $50.0 million at 55,000,000, minus the amount of any one time outstanding less any Net Proceeds permanent reduction in the amount of Asset Sales applied to permanently reduce borrowings permitted thereunder in accordance with the Bank Credit Facility pursuant to terms thereof, and (2) the provisions described in Section 4.10;
amount of the Borrowing Base, (ii) the incurrence by DFG (and Guarantees thereof by the Company and its Restricted Subsidiaries the Guarantors) of the Existing Indebtedness;
Indebtedness represented by (1) DFG Senior Notes issued on the Closing Date in the aggregate principal amount not to exceed $220,000,000 and (2) DFG Senior Notes issued after the Closing Date pursuant to the DFG Senior Notes Indenture so long as the Net Proceeds of such issuances are used, substantially contemporaneously with such issuances, solely to redeem the Notes and the Subordinated Notes in compliance with the voluntary redemption provisions of this Agreement and the Subordinated Note Exchange Agreement, (iii) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness, (iv) the incurrence by the Company and its Subsidiaries of the Indebtedness represented by the Senior Subordinated Notes and the Guarantees thereof by any Restricted Subsidiaries pursuant to the provisions in Section 12.01 hereof;
Subordinated Notes, (ivv) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case case, incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of the Company or such Restricted Subsidiary, in an aggregate principal amount not to exceed $5.0 million 5,000,000 at any time outstanding;
, (vvi) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in connection with exchange for, or the acquisition net proceeds of assets which are used to extend, refinance, renew, replace, defease or a new Restricted Subsidiary; provided refund, Indebtedness that such Indebtedness was incurred permitted by this Agreement to be incurred, (vii) the prior owner of such assets or such Restricted Subsidiary prior to such acquisition incurrence by the Company or one any of its Restricted Subsidiaries and was not incurred in connection with, or in contemplation of, such acquisition by the Company or one of it Restricted Subsidiaries; and provided further that the principal amount (or accreted value, as applicable) of such Indebtedness, together with any other outstanding Indebtedness incurred pursuant to this clause (v), does not exceed $5.0 million;
(vi) the incurrence of intercompany Indebtedness between or among the Company and any of its Wholly Owned Restricted Subsidiaries; provided, however, that (A) if the Company is the obligor on such Indebtedness, such Indebtedness is expressly subordinate to the payment in full of all Obligations with respect to the Notes and (B)(1) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Wholly Owned Restricted Subsidiary of the Company or and (2) any sale or other transfer of any such Indebtedness to a Person that is neither not either the Company, Company or a Wholly Owned Restricted Subsidiary of the Company, shall be deemed deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be;
, (viiviii) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Debt in exchange for, or the net proceeds of which are used to extend, refinance, renew, replace, defease or refund Indebtedness that was permitted by this Indenture to be incurred;
(viii) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt; provided, that if, and to the extent any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company.
(ix) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing or hedging (A) interest rate risk with respect to any floating rate indebtedness Indebtedness that is permitted by the terms of this Indenture Agreement to be outstanding; and
, or (B) currency exchange risk in connection with existing financial obligations and not for purposes of speculation, (ix) the incurrence by the Company or any of its Subsidiaries of Indebtedness (in addition to Indebtedness permitted by any other clause of this paragraph) in an aggregate principal amount (or accreted value, as applicable) at any time outstanding not to exceed $10,000,000, (x) the incurrence by the Company and or any of its Restricted Subsidiaries of additional Indebtedness Earn-out Obligations in an aggregate amount not to exceed $7.5 million 5,000,000 at any time outstandingoutstanding and (xi) the Incurrence by a Receivables Subsidiary of Indebtedness in connection with a Qualified Receivables Transaction that is without recourse (other than pursuant to representations, warranties, covenants and indemnities entered into in the ordinary course of business in connection with a Qualified Receivables Transaction) to DFG or any of its Subsidiaries or any of their respective assets and that is not Guaranteed by DFG or any of its Subsidiaries.
(c) Notwithstanding any provision contained in this Section 8.4 to the contrary, after the Closing Date, neither the Company shall, nor shall it permit any of its Subsidiaries to, incur any Indebtedness to LGP (other than (i) as a Purchaser and (ii) solely as a counterparty to any Hedging Obligation) unless such Indebtedness constitutes Subordinated Indebtedness.
(d) For purposes of determining compliance with this Section 8.4, in the event that an item of Indebtedness meets the criteria of more than one of the categories of Indebtedness described in clauses (i) through (ix) of paragraph (b) of this Section 8.4, the Company shall, in its sole discretion, classify such item of Indebtedness in any manner that complies with this Section 8.4 and will only be required to include the amount and type of such Indebtedness in one of such clauses or pursuant to Section 8.4(a), and may re-classify any such item of Indebtedness from time to time among such clauses or the first paragraph of this Section 8.4, so long as such item meets the applicable criteria for such category. Accrual of interest, accretion of accreted value and issuance of securities paid-in-kind shall not be deemed to be an incurrence of Indebtedness for purposes of this Section 8.4.
Appears in 1 contract
Incurrence of Indebtedness and Issuance of Preferred Stock. (a) The Company shall not, will not and shall the Parent will not permit any of its Subsidiaries other Restricted Subsidiary to, directly or indirectly, create, incur, issue, assume, guaranty or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") Incur any Indebtedness (including Acquired DebtIndebtedness), and the Company will not and the Parent will not permit any other Restricted Subsidiary to issue any Preferred Stock; providedprovided that the Company and any Designated Restricted Subsidiary may incur Indebtedness if, howeverafter giving effect to the Incurrence of such Indebtedness and the receipt and application of the proceeds therefrom, that, so long as (x) no Default or Event of Default has occurred and is continuingcontinuing and (y) the Combined Leverage Ratio does not exceed 5.5 to 1.0; provided, further, that in the case of any Designated Restricted Subsidiary, such Indebtedness to be incurred under this paragraph has a final Stated Maturity that occurs after the final Stated Maturity of the Notes and the Average Life of such Indebtedness at least equal to the remaining Average Life of the Notes.
(b) Notwithstanding the foregoing, to the extent provided below, the Company or any other Restricted Subsidiary, may Incur each and its all of the following (“Permitted Indebtedness”):
(1) Indebtedness of the Company under the Notes (excluding Additional Notes), Indebtedness under any Note Guarantee and Indebtedness of any Restricted Subsidiaries may incur Subsidiary (other than a Designated Restricted Subsidiary that has incurred Indebtedness outstanding under paragraph (a) of this covenant) under any Rupee Debt;
(2) Indebtedness outstanding on the Original Issue Date (excluding Indebtedness permitted under clause (3) below) including the Shareholder Loans (the “Existing Indebtedness”);
(3) Indebtedness of any Restricted Subsidiary owed to the Company or any other Restricted Subsidiary; provided that any event which results in any such Restricted Subsidiary to which such Indebtedness is owed ceasing to be a Restricted Subsidiary or any subsequent transfer of such Indebtedness (including Acquired other than to the Company or any other Restricted Subsidiary) shall be deemed, in each case, to constitute an Incurrence of such Indebtedness not permitted by this clause (b)(3); and if any Restricted Subsidiary is the obligor on such Indebtedness, such Indebtedness must be unsecured and be expressly subordinated in right of payment to the Notes, in the case of the Company, the Note Guarantee, in the case of a Guarantor, or the Rupee Debt, in the case of another Restricted Subsidiary to the extent such Restricted Subsidiary is the obligor under Rupee Debt;
(4) Indebtedness of the Company (“Permitted Refinancing Indebtedness”) issued in exchange for, or the net proceeds of which are used to refinance or refund, replace, exchange, renew, repay, redeem, defease, discharge or extend (collectively, “refinance” and “refinances” and “refinanced” shall have a correlative meaning), then outstanding Indebtedness Incurred under clause (a) or clause (b)(1), (2), (4), (9) or (16) of Section 4.09 and any refinancings thereof in an amount not to exceed the amount so refinanced (plus premiums, accrued interest, fees and expenses); provided that
(A) Indebtedness the proceeds of which are used to refinance the Notes or Indebtedness that is pari passu with, or subordinated in right of payment to, the Notes will only be permitted under this clause (b)(4) if (x) in case the Fixed Charge Coverage Ratio Notes are refinanced in part or the Indebtedness to be refinanced is pari passu with the Notes, such new Indebtedness, by its terms or by the terms of any agreement or instrument pursuant to which such new Indebtedness is outstanding, is expressly made pari passu with, or subordinate in right of payment to, the remaining Notes or (y) in case the Indebtedness to be refinanced is subordinated in right of payment to the Notes, such new Indebtedness, by its terms or by the terms of any agreement or instrument pursuant to which such new Indebtedness is issued or remains outstanding, is expressly made subordinate in right of payment to the Notes, at least to the extent that the Indebtedness to be refinanced is subordinated to the Notes; and
(B) such new Indebtedness, determined as of the date of Incurrence of such new Indebtedness, does not mature prior to the Stated Maturity of the Indebtedness to be refinanced, and the Average Life of such new Indebtedness is at least equal to the remaining Average Life of the Indebtedness to be refinanced; provided that such new Indebtedness under this clause (b)(4) that refinances Existing Indebtedness will be permitted as long as (x) such new Indebtedness does not mature prior to the Stated Maturity of the Notes and the Average Life of such new Indebtedness is at least equal to the remaining Average Life of the Notes and (y) such Existing Indebtedness is refinanced from the net proceeds of an Incurrence of Rupee Debt which will not mature prior to the Stated Maturity of the Notes and will have an Average Life at least equal to the remaining Average Life of the Notes.
(5) Indebtedness Incurred by the Company pursuant to Hedging Obligations entered into for the Company's most recently ended four full fiscal quarters purpose of protecting the Company from fluctuations in interest rates, currencies or commodity prices and not for which financial statements speculation;
(6) Indebtedness Incurred by any Restricted Subsidiary constituting reimbursement obligations with respect to workers’ compensation claims or self-insurance obligations or bid, performance, surety or appeal bonds or payment obligations in connection with insurance premiums or similar obligations, security deposits and bank overdrafts (and letters of credit in connection with or in lieu of each of the foregoing) in the ordinary course of business (in each case other than for an obligation for borrowed money);
(7) Indebtedness Incurred by any Restricted Subsidiary constituting letters of credit, trade guarantees or reimbursement obligations with respect to letters of credit or trade guarantees, in each case issued in the ordinary course of business to the extent that such letters of credit or trade guarantees are available immediately preceding not drawn upon or, if drawn upon, to the extent such drawing is reimbursed no later than the 60 days following receipt by such Restricted Subsidiary of a demand for reimbursement;
(8) Indebtedness arising from agreements providing for indemnification, adjustment of purchase price, earn-outs or similar obligations, or from guarantees or letters of credit, surety bonds or performance bonds securing any obligation of any Restricted Subsidiary, in any case, Incurred in connection with the acquisition or disposition of any business, assets or Restricted Subsidiary (other than guarantees of Indebtedness Incurred by any Person acquiring all or any portion of such business, assets or Restricted Subsidiary for the purpose of financing such acquisition); provided that the maximum aggregate liability of a Restricted Subsidiary in respect of all such Indebtedness Incurred in connection with a disposition shall at no time exceed the gross proceeds actually received by such Restricted Subsidiary from the disposition of such business, assets or Restricted Subsidiary;
(9) Acquired Indebtedness of any Restricted Subsidiary outstanding on the date on which such additional Indebtedness is incurred would have been at least 2.0 to 1Person becomes a Restricted Subsidiary; provided,
(A) if such Person becomes a Restricted Subsidiary on or before the first anniversary of the Original Issue Date, determined that on the date that such Person becomes a Restricted Subsidiary, the amount of such Indebtedness, after giving pro forma basis effect to such transaction or series of transactions, including such Incurrence and any repayment of such Indebtedness with cash on hand, does not exceed five times the amount of Acquired EBITDA of such Subsidiary as set forth in the relevant Project Projection Report :
(including a pro forma application of the net proceeds therefrom), as i) if the additional Indebtedness had been incurred at such Subsidiary commenced commercial operations prior to the beginning of the most recently completed fiscal year of the Restricted Group, the current fiscal year; or
(ii) if such four-quarter period. The foregoing provisions will not apply toSubsidiary commenced commercial operations since the beginning of the most recently completed fiscal year of the Restricted Group, the next full fiscal year; in each case after making such adjustments as are appropriate and consistent with the adjustments set forth in the definition of “Combined EBITDA”;
(B) if such Person becomes a Restricted Subsidiary after the first anniversary of the Original Issue Date, that on the date that such Person becomes a Restricted Subsidiary, either:
(i) the incurrence Company would have been able to incur $1.00 of additional Indebtedness under clause (a) of Section 4.09 after giving pro forma effect to such transaction or series of transactions, including such Incurrence and any repayment of such Indebtedness; or
(ii) Combined Indebtedness, after giving pro forma effect to such transaction or series of transactions, including such Incurrence and any repayment of such Indebtedness with cash on hand, does not exceed five and a half times the amount of Combined EBITDA for the then most recently concluded Reference Period plus five times the amount of Acquired EBITDA of such Subsidiary as set forth in the relevant Project Projection Report for
1. if such Subsidiary commenced commercial operations prior to the beginning of the most recently completed fiscal year of the Restricted Group, the current fiscal year; or
2. if such Subsidiary commenced commercial operations since the beginning of the most recently completed fiscal year of the Restricted Group, the next full fiscal year; in each case after making such adjustments as are appropriate and consistent with the adjustments set forth in the definition of “Combined EBITDA”; and
(C) any such Acquired Indebtedness under clause (b)(9)(A) of Section 4.09 that is not refinanced or refunded, replaced, exchanged, renewed, repaid, redeemed, defeased or discharged within three months of the date such Person becomes a Restricted Subsidiary by Rupee Debt subscribed for or loaned by the Company and its financed through the issuance of Additional Notes incurred under clause (b)(16) of Section 4.09 or Indebtedness incurred under paragraph (a) of this covenant, and any such Acquired Indebtedness under clause (b)(9)(B) of Section 4.09 that is not refinanced or refunded, replaced, exchanged, renewed, repaid, redeemed, defeased or discharged within three months of the date such Person becomes a Restricted Subsidiaries Subsidiary by cash, Rupee Debt subscribed for or loaned by the Company, Indebtedness incurred under paragraph (a) of this covenant or Indebtedness pursuant incurred under clause (b)(3) of Section 4.09 from any other Restricted Subsidiary shall be deemed, in each case, to constitute an Incurrence of such Indebtedness not permitted by these clauses (b)(9)(A) and (b)(9)(B) of Section 4.09;
(10) Indebtedness arising from the honoring by a bank or other financial institution of a check, draft or similar instrument drawn against insufficient funds; provided, however, that such Indebtedness is extinguished within ten Business Days of Incurrence;
(11) Indebtedness Incurred by any Restricted Subsidiary under Credit Facilities with a maturity of one year or less; provided that the aggregate principal amount outstanding at any time does not exceed US$30.0 million (or the Dollar Equivalent thereof);
(12) Subordinated Shareholder Debt;
(13) Indebtedness Incurred by any Restricted Subsidiary to the Bank Credit Facility extent the net cash proceeds thereof are promptly and irrevocably deposited with the Trustee to defease or to satisfy and discharge the Notes as described in Article 8 and Article 12;
(14) Indebtedness Incurred by any Restricted Subsidiary in an aggregate principal amount outstanding at any time (together with refinancings thereof under this clause (14)) not to exceed $50.0 US$10.0 million at any one time outstanding less any Net Proceeds of Asset Sales applied to permanently reduce (or the Bank Credit Facility pursuant to the provisions described in Section 4.10Dollar Equivalent thereof);
(ii15) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness (including Acquired Indebtedness;
(iii) the incurrence by the Company and its Restricted Subsidiaries of Indebtedness represented by the Senior Subordinated Notes and the Guarantees thereof Incurred by any Restricted Subsidiaries pursuant to the provisions in Section 12.01 hereof;
Subsidiary (ivother than a Designated Restricted Subsidiary) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case incurred for the purpose of financing all or any part of the purchase price or cost of construction acquisition, design, construction, installation or improvement of property, plant or equipment and related assets used in the business of the Company or any of its Restricted Subsidiaries (or the Capital Stock of a Person engaged in a Permitted Business which will upon such acquisition become a Restricted Subsidiary), in an aggregate principal amount outstanding at any time (together with refinancing thereof under this clause (15)), not to exceed $5.0 million at any time outstanding;
15.0% of Total Assets (v) or the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness in connection with the acquisition of assets or a new Restricted SubsidiaryDollar Equivalent thereof); provided that such Indebtedness was incurred by the prior owner of such assets or such Restricted Subsidiary prior to such acquisition by the Company or one has not Incurred any Rupee Debt, any Indebtedness described under paragraph (a) of its Restricted Subsidiaries and was not incurred in connection withthis covenant, or any Indebtedness of the type described in contemplation of, such acquisition by the Company or one of it Restricted Subsidiaries; and provided further that the principal amount clause (or accreted value, as applicableb)(3) of such Indebtedness, together with any other outstanding Indebtedness incurred pursuant to this clause (v), does not exceed $5.0 million;Section 4.09; and
(vi16) the incurrence Indebtedness consisting of intercompany Indebtedness between or among the Company Additional Notes and any of its Wholly Owned Restricted Subsidiaries; provided, that any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Wholly Owned Restricted Subsidiary of the Company or any sale or other transfer of any such Indebtedness to a Person that is neither the Company, or a Wholly Owned Restricted Subsidiary of the Company, shall be deemed to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be;
(vii) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Debt Note Guarantees issued in exchange for, or the net proceeds of which are used to extendrefinance or refund, refinancereplace, exchange, renew, replacerepay, redeem, defease or refund discharge Acquired Indebtedness that was permitted by this Indenture incurred pursuant to be incurred;clause (b)(9)(A) of Section 4.09 (plus premiums, accrued interest, fees and expenses).
(viiic) For purposes of determining compliance with this covenant, in the incurrence by event that an item of Indebtedness meets the criteria of more than one type of Permitted Indebtedness, or of Indebtedness described in Section 4.09(a) and one or more types of Permitted Indebtedness, the Parent or the Company's Unrestricted Subsidiaries of Non-Recourse Debt; provided, that ifin its sole discretion, shall classify, and from time to the extent any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiarytime may reclassify, such event shall item of Indebtedness.
(d) The accrual of interest, the accretion or amortization of original issue discount and the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, will not be deemed to constitute be an incurrence of Indebtedness by a Restricted Subsidiary for purposes of this covenant; provided that, in each such case, the amount of any such accrual, accretion, amortization or payment is included in the Combined Interest Expense of the CompanyRestricted Group as accrued.
(ixe) Notwithstanding any other provision of this covenant, the incurrence by maximum amount of Indebtedness that may be Incurred pursuant to this covenant will not be deemed to be exceeded solely as a result of fluctuations in the Company exchange rates of currencies. For purposes of determining compliance with any U.S. dollar-denominated restriction on the Incurrence of Indebtedness, the U.S. dollar equivalent principal amount of Indebtedness denominated in a foreign currency shall be calculated based on the relevant currency exchange rate in effect on the date such Indebtedness was incurred (or first committed, in the case of revolving credit debt); provided that if such Indebtedness is Incurred to refinance other Indebtedness denominated in a foreign currency, and such refinancing would cause the applicable U.S. dollar-denominated restriction to be exceeded if calculated at the relevant currency exchange rate in effect on the date of such refinancing, such U.S. dollar-denominated restriction shall be deemed not to have been exceeded so long as the principal amount of such refinancing Indebtedness does not exceed the principal amount of such Indebtedness being refinanced (plus premiums, accrued interest, fees and expenses). The maximum amount of Indebtedness permitted to be incurred under clause (b)(11), (14) or (15) shall not be deemed to have been exceeded in connection with refinancing of such Indebtedness pursuant to such clause so long as the principal amount of such refinancing Indebtedness does not exceed the principal amount of such Indebtedness being refinanced plus premiums, accrued interests, fees and expenses. The principal amount of any of its Restricted Subsidiaries of Hedging Obligations that are incurred for Indebtedness Incurred to refinance other Indebtedness, if Incurred in a different currency than the purpose of fixing or hedging interest Indebtedness being refinanced, shall be calculated based on the currency exchange rate risk with respect applicable to any floating rate indebtedness the currencies in which such respective Indebtedness is denominated that is permitted by in effect on the terms date of this Indenture to be outstanding; and
(x) the incurrence by the Company and its Restricted Subsidiaries of additional Indebtedness in an aggregate amount not to exceed $7.5 million at any time outstandingsuch refinancing.
Appears in 1 contract
Sources: Indenture (Azure Power Global LTD)
Incurrence of Indebtedness and Issuance of Preferred Stock. The Company shall will not, and shall will not permit any of its Restricted Subsidiaries to, directly or indirectly, create, create incur, issue, assume, guaranty guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") any Indebtedness (including Acquired Debt)) and the Company shall not issue any Disqualified Stock and shall not permit any of its Restricted Subsidiaries to issue any shares of preferred stock; provided, however, that, so long as no Default or Event of Default has occurred and is continuing, that the Company and its Restricted Subsidiaries may incur Indebtedness (including Acquired Debt) or issue shares of Disqualified Stock if the Fixed Charge Coverage Ratio for the Company's most recently ended four full fiscal quarters for which financial statements are available immediately preceding Leverage Ratio at the date on which time of the incurrence of such additional Indebtedness indebtedness, after giving pro-forma effect thereto and to the use of proceeds therefrom, is incurred would have been at least 2.0 less than 7.0 to 1. Notwithstanding the foregoing, determined on a pro forma basis (including a pro forma application the Exchange Debenture Indenture will not prohibit any of the net proceeds therefrom)following (collectively, as if "Permitted Indebtedness"): (a) the additional Indebtedness had been incurred at evidenced by the beginning of such four-quarter period. The foregoing provisions will not apply to:
Exchange Debentures; (ib) the incurrence by the Company and its Restricted Subsidiaries of Indebtedness pursuant to Credit Agreements or the Bank Credit Facility in an Company's __% Senior Subordinated Notes due 2008, so long as the aggregate principal amount not to exceed $50.0 million of all Indebtedness outstanding under all Credit Agreements does not, at any one time outstanding time, exceed $190.0 million, less any Net Proceeds the aggregate amount of all proceeds from all Asset Sales that have been applied since the date hereof to permanently reduce the Bank Credit Facility outstanding amount of such Indebtedness pursuant to the provisions described in under Section 4.10;
; (iic) the incurrence by all Indebtedness of the Company and its Restricted Subsidiaries in existence as of the Existing date hereof; (d) intercompany Indebtedness between or among the Company and any of its Wholly Owned Restricted Subsidiaries; provided, however, that (i) if the Company is the obligor on such Indebtedness;
, such Indebtedness is expressly subordinate to the payment in full of all Obligations with respect to the Exchange Debentures and (iiiii)(A) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Wholly Owned Restricted Subsidiary and (B) any sale or other transfer of any such Indebtedness to a Person that is not either the Company or a Wholly Owned Restricted Subsidiary shall be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company and its or such Restricted Subsidiaries of Indebtedness represented by Subsidiary, as the Senior Subordinated Notes and the Guarantees thereof by any Restricted Subsidiaries pursuant to the provisions in Section 12.01 hereof;
case may be; (ive) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case incurred for the purpose of financing all or any part of the purchase price price, lease or cost of construction or improvement of property, plant or equipment used in the business of the Company or such Restricted Subsidiary, a Permitted Business in an aggregate principal amount not to exceed $5.0 15.0 million at any time outstanding;
; (vf) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness in connection with the acquisition of assets or a new Restricted Subsidiary; provided that such Indebtedness was incurred by the prior owner of such assets or such Restricted Subsidiary prior to such acquisition by the Company or one of its Restricted Subsidiaries and was not incurred in connection with, or in contemplation of, such acquisition by the Company or one of it Restricted Subsidiaries; and provided further that the principal amount (or accreted value, as applicable) of such Indebtedness, together with any other outstanding Indebtedness incurred pursuant to this clause (v), does not exceed $5.0 million;
(vi) the incurrence of intercompany Indebtedness between or among the Company and any of its Wholly Owned Restricted Subsidiaries; provided, that any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Wholly Owned Restricted Subsidiary of the Company or any sale or other transfer of any such Indebtedness to a Person that is neither the Company, or a Wholly Owned Restricted Subsidiary of the Company, shall be deemed to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be;
(vii) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Debt in exchange for, or the net proceeds of which are used to extendrefund, refinance, renew, replace, defease refinance or refund replace Indebtedness (other than intercompany Indebtedness) that was permitted by this the Exchange Debenture Indenture to be incurred;
; (viii) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt; provided, that if, and to the extent any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company.
(ixg) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk with respect to any floating or variable rate indebtedness Indebtedness or for the purpose of protecting against fluctuations in interest rates or the value of foreign currencies purchased or received, in each case in respect of Indebtedness that is permitted by the terms of this Exchange Debenture Indenture to be outstanding; and
(x) provided, however, that in the incurrence by case of Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risks with respect to Indebtedness, the notional principal amount of any such Hedging Obligation does not exceed the principal amount of the Indebtedness to which such Hedging Obligation relates and in the case of Hedging Obligations incurred for the purpose of protecting against fluctuations in interest rates or the value of foreign currencies purchased or received, such Hedging Obligations do not increase the Indebtedness of the Company and its Restricted Subsidiaries outstanding other than as a result of additional fluctuations in foreign currency exchange rates or by reason of fees, indemnities and compensation payable thereunder; (h) Indebtedness incurred solely in respect of performance, surety and similar bonds or completion guarantees, to the extent that such incurrence does not result in the incurrence of any obligation for the payment of borrowed money to others; (i) Indebtedness arising out of standby letters of credit covering workers compensation, performance or similar obligations in an aggregate amount not to exceed $7.5 million 500,000 at any time outstanding; (j) any guarantee of the Company of Indebtedness or other obligations of any of its Restricted Subsidiaries so long as the incurrence of such Indebtedness incurred by such Restricted Subsidiary is permitted under the terms of the Exchange Debenture Indenture; (k) the incurrence by the Company of additional Indebtedness in an aggregate principal amount (or accreted value, as applicable) at any time outstanding not to exceed $10.0 million; and (l) the incurrence by the Company of Indebtedness in respect of Exchange Debentures issued as payment in kind interest on Exchange Debentures issued on the exchange of the Series A Preferred Stock, to the extent such interest payments are made pursuant to the terms hereof. The Company will not permit any Unrestricted Subsidiary to incur any Indebtedness other than Non-Recourse Debt; provided, however, if any such Indebtedness ceases to be Non-Recourse Debt, such event shall be deemed to constitute an incurrence of Indebtedness by the Company.
Appears in 1 contract
Sources: Indenture (Cumulus Media Inc)
Incurrence of Indebtedness and Issuance of Preferred Stock. The Company shall will not, and shall will not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guaranty guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incurINCUR") any Indebtedness (including Acquired Debt), and the Company will not issue any Disqualified Stock, and the Company will not permit any of its Restricted Subsidiaries to issue any Disqualified Stock or preferred stock; provided, however, that, so long as no Default or Event of Default has occurred and is continuing, that the Company and its Restricted Subsidiaries any Guarantor may incur Indebtedness (including Acquired Debt) ), if the Fixed Charge Coverage Ratio for the Company's most recently ended four full fiscal quarters for which internal financial statements are available immediately preceding the date on which such additional Indebtedness is incurred would have been at least 2.0 2.25 to 11 from the date of this Indenture through and including October 31, 2002 and 2.50 to 1 thereafter, determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the additional Indebtedness had been incurred at the beginning of such four-quarter period. The foregoing provisions So long as no Default shall have occurred and be continuing or would be caused thereby, the first paragraph of this Section 4.09 will not apply to:prohibit the incurrence of any of the following items of Indebtedness (collectively, "PERMITTED DEBT"):
(i1) the incurrence by the Company of Indebtedness under Credit Facilities (and the incurrence by the Guarantors of guarantees thereof) in an aggregate principal amount at any one time outstanding (with letters of credit being deemed to have a principal amount equal to the maximum potential liability of the Company and its Restricted Subsidiaries thereunder) not to exceed $550 million, of which up to $40 million may be incurred by the Company's Puerto Rican Restricted Subsidiaries that are borrowers under the Credit Agreement (and the Company and its Restricted Subsidiaries may guarantee such borrowings by the Company's Puerto Rican Restricted Subsidiaries), less the aggregate amount of all Net Proceeds of Asset Sales applied by the Company or any Restricted Subsidiary to repay any term Indebtedness under Credit Facilities pursuant to Section 4.10 hereof;
(2) the incurrence by the Company and its any Restricted Subsidiaries Subsidiary of Indebtedness pursuant to the Bank Credit Facility in an aggregate principal amount not to exceed $50.0 million at any one time outstanding less any Net Proceeds of Asset Sales applied to permanently reduce the Bank Credit Facility pursuant to the provisions described in Section 4.10Existing Indebtedness;
(ii3) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;
(iii) the incurrence by the Company and its Restricted Subsidiaries Guarantors of Indebtedness represented by the Senior Subordinated Notes and the related Subsidiary Guarantees thereof by any Restricted Subsidiaries to be issued on the date hereof and the Exchange Notes and the related Subsidiary Guarantees to be issued pursuant to the provisions in Section 12.01 hereofRegistration Rights Agreement;
(iv4) the incurrence by the Company or any of its Restricted Subsidiaries Guarantor of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of the Company or such Restricted Subsidiary, in an aggregate principal amount not to exceed $5.0 million at any time outstanding;
(v) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness in connection with the acquisition of assets or a new Restricted Subsidiary; provided that such Indebtedness was incurred by the prior owner of such assets or such Restricted Subsidiary prior to such acquisition by the Company or one of its Restricted Subsidiaries and was not incurred in connection with, or in contemplation of, such acquisition by the Company or one of it Restricted Subsidiaries; and provided further that the principal amount (or accreted value, as applicable) of such Indebtedness, together with any other outstanding Indebtedness incurred pursuant to this clause (v), does not exceed $5.0 million;
(vi) the incurrence of intercompany Indebtedness between or among the Company and any of its Wholly Owned Restricted Subsidiaries; provided, that any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Wholly Owned Restricted Subsidiary of the Company or any sale or other transfer of any such Indebtedness to a Person that is neither the Company, or a Wholly Owned Restricted Subsidiary of the Company, shall be deemed to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be;
(vii) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Debt in exchange for, or the net proceeds of which are used to extend, refinance, renew, replace, defease or refund Indebtedness that was permitted by this Indenture to be incurred;
(viii) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt; provided, that if, and to the extent any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company.
(ix) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk with respect to any floating rate indebtedness that is permitted by the terms of this Indenture to be outstanding; and
(x) the incurrence by the Company and its Restricted Subsidiaries of additional Indebtedness in an aggregate amount not to exceed $7.5 million at any time outstanding.equipment
Appears in 1 contract
Incurrence of Indebtedness and Issuance of Preferred Stock. The Company shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guaranty guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") any Indebtedness (including Acquired Debt)) and the Company shall not issue any Disqualified Stock and shall not permit any of its Restricted Subsidiaries to issue any shares of Disqualified Stock or Preferred Stock; provided, however, thatthat the Company or any of its Restricted Subsidiaries that are Guarantors may incur Indebtedness, so long as no Default or Event the Company may issue Disqualified Stock and Restricted Subsidiaries of Default has occurred and is continuing, the Company that are Guarantors may issue Preferred Stock if the Leverage Ratio of the Company and its Restricted Subsidiaries may incur Indebtedness (including Acquired Debt) if the Fixed Charge Coverage Ratio for the Company's most recently ended four full fiscal quarters for which financial statements are available immediately preceding the date on which such additional Indebtedness is incurred would have been at least 2.0 not greater than 4.25 to 1, 1.0 determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the additional Indebtedness had been incurred incurred, or the Disqualified Stock or Preferred Stock had been issued, as the case may be, at the beginning of such four-quarter periodthe most recently ended fiscal quarter. The foregoing provisions will Debt incurred under this paragraph, or once incurred under this paragraph and subsequently refinanced under clause (5) of the next succeeding paragraph, is collectively referred to as "Ratio Debt"). So long as no Default under this Indenture shall have occurred and be continuing or would be caused thereby, the first paragraph of this Section 4.10 shall not apply to:prohibit the incurrence of any of the following items of Indebtedness (collectively, "Permitted Debt"):
(1) the incurrence of Indebtedness under the Credit Facilities by (x) the Company and any Restricted Subsidiary that is a guarantor under the Credit Facilities prior to the Guarantee and Pledge Date and (y) the Company and its Restricted Subsidiaries that are Guarantors (or by Subsidiaries that cease to be Guarantors as a result of the operation of (i) the first paragraph (a) of Section 11.04 or (ii) the second paragraph of clause (a) of Section 11.04 and are no longer otherwise obligors with respect to the CCO Credit Facility and the Related Obligations, except continuing to secure the Company's obligations under the CCO Credit Facility and the Related Obligations and the Issuers' obligations with respect to the Notes under Article 10); provided, however, that the aggregate principal amount of all Indebtedness of the Company and its Restricted Subsidiaries outstanding under this clause (1) for all Credit Facilities after giving effect to such incurrence does not exceed an amount equal to $6.8 billion less the aggregate amount of all Net Proceeds from Asset Sales applied by the Company or any of its Restricted Subsidiaries to repay Indebtedness under a Credit Facility pursuant to Section 4.11;
(2) the incurrence by the Company and its Restricted Subsidiaries of Existing Indebtedness pursuant to (other than under the Bank Credit Facility in an aggregate principal amount not to exceed $50.0 million at any one time outstanding less any Net Proceeds of Asset Sales applied to permanently reduce the Bank Credit Facility pursuant to the provisions described in Section 4.10Facilities);
(ii3) the incurrence by on the Company and its Restricted Subsidiaries of the Existing Indebtedness;
(iii) the incurrence Issue Date by the Company and its Restricted Subsidiaries of Indebtedness represented by the Senior Subordinated Notes and the Guarantees thereof by (other than any Restricted Subsidiaries pursuant to the provisions in Section 12.01 hereofAdditional Notes);
(iv4) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case case, incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement (including, without limitation, the cost of propertydesign, plant or equipment used in the business development, construction, acquisition, transportation, installation, improvement and migration) of Productive Assets of the Company or such any of its Restricted SubsidiarySubsidiaries, in an aggregate principal amount not to exceed $5.0 75 million at any time outstandingoutstanding pursuant to this clause (4);
(v5) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in connection exchange for, or the net proceeds of which are used to refund, refinance or replace, in whole or in part, Indebtedness that was permitted by this Indenture to be incurred under this clause (5), the first paragraph of this Section 4.10 (but only with the acquisition of assets or a new Restricted Subsidiary; provided that respect to such Indebtedness was incurred first paragraph if by the prior owner Company and its Restricted Subsidiaries that are Guarantors) or clause (2) or (3) of such assets or such Restricted Subsidiary prior to such acquisition this paragraph;
(6) the incurrence by the Company or one any of its Restricted Subsidiaries and was not incurred in connection with, or in contemplation of, such acquisition by the Company or one of it Restricted Subsidiaries; and provided further that the principal amount (or accreted value, as applicable) of such Indebtedness, together with any other outstanding Indebtedness incurred pursuant to this clause (v), does not exceed $5.0 million;
(vi) the incurrence of intercompany Indebtedness between or among the Company and and/or any of its Wholly Owned Restricted Subsidiaries; provided, however, that:
(a) if the Company or a Restricted Subsidiary of the Company that is a Guarantor is the obligor on such Indebtedness, such Indebtedness must be expressly subordinated to the Notes or the Note Guarantee of such Guarantor on the same terms as such Indebtedness is subordinated to the CCO Credit Facility and the Related Obligations; provided, however, that any such Indebtedness owed to CC VI Operating Company, LLC, CC VIII Operating, LLC or Falcon Cable Communications, LLC, for so long as each is a Restricted Subsidiary of the Company, shall not be required to be so subordinated until the Guarantee and Pledge Date; and
(i) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Wholly Owned Restricted Subsidiary of the Company or and (ii) any sale or other transfer of any such Indebtedness to a Person that is neither the Company, or Company nor a Wholly Owned Restricted Subsidiary of the Company, Company shall be deemed deemed, in each case, to constitute an incurrence of such Indebtedness that was not permitted by the Company or such Restricted Subsidiary, as the case may bethis clause (6);
(vii) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Debt in exchange for, or the net proceeds of which are used to extend, refinance, renew, replace, defease or refund Indebtedness that was permitted by this Indenture to be incurred;
(viii) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt; provided, that if, and to the extent any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company.
(ix7) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing fixing, hedging or hedging swapping interest rate risk with respect to any floating rate indebtedness Indebtedness that is permitted by the terms of this Indenture to be outstanding; and;
(8) the guarantee by the Company or any of its Restricted Subsidiaries of Indebtedness of a Restricted Subsidiary that was permitted to be incurred by another provision of this Section 4.10;
(9) Acquired Debt of a Person that becomes, or is merged into, a Restricted Subsidiary that is not a Guarantor; provided, however, that (x) such Acquired Debt was not incurred in connection with, or in contemplation of, such Person becoming, or being merged into, a Restricted Subsidiary and (y) the Company would, at the time such Person becomes, or is merged into, a Restricted Subsidiary and after giving pro forma effect thereto as if such acquisition or merger had been made at the beginning of the applicable quarter period, have been permitted to incur at least $1.00 of additional Indebtedness pursuant to the Leverage Ratio test set forth in the first paragraph of this Section 4.10;
(10) the incurrence by the Company and or any of its Restricted Subsidiaries of additional Indebtedness in an aggregate principal amount at any time outstanding under this clause (10) not to exceed $7.5 300 million; and
(11) the accretion or amortization of original issue discount and the write-up of Indebtedness in accordance with purchase accounting.
(a) meets the criteria of more than one of the categories of Permitted Debt described in clauses (1) through (11) above or (b) is entitled to be incurred pursuant to the first paragraph of this Section 4.10, the Company shall be permitted to classify and from time to time to reclassify such item of Indebtedness in any manner that complies with this Section 4.10. Once any item of Indebtedness is so reclassified, it shall no longer be deemed outstanding under the category of Permitted Debt, where initially incurred or previously reclassified. For avoidance of doubt, Indebtedness incurred pursuant to a single agreement, instrument, program, facility or line of credit may be classified as Indebtedness arising in part under one of the clauses listed above or under the first paragraph of this Section 4.10, and in part under any one or more of the clauses listed above, to the extent that such Indebtedness satisfies the criteria for such classification. The Company shall not, directly or indirectly, incur, or permit any of its Restricted Subsidiaries that is a Guarantor to incur, any Indebtedness which by its contractual terms (or by the contractual terms of any agreement to which any of the Company or its Restricted Subsidiaries is a party governing such Indebtedness) is subordinated in right of payment to any other Indebtedness of the Company or such Guarantor, unless such Indebtedness is also by its terms (or by the contractual terms of any agreement to which the Company or such Guarantor is a party governing such Indebtedness) made expressly subordinate to the Notes (or relevant Note Guarantee) to the same extent and in the same manner as such Indebtedness is subordinated to other Indebtedness of the Company or such Restricted Subsidiary, as the case may be (it being understood that Indebtedness would not be considered subordinated in right of payment (i) merely by reason of being secured with a lower-priority Lien, (ii) if such Indebtedness constitutes Additional Pari Passu Second Priority Indebtedness or (iii) if such Indebtedness is pari passu in right of payment to the Notes and subject to an agreement the terms of which are substantially similar to the intercreditor agreement referred to in Section 7.12. Notwithstanding the foregoing, all Indebtedness incurred during any Suspension Period shall not be deemed to have been incurred for the purposes of this Section 4.10, but shall be included in the calculation of outstanding Indebtedness from and after the next succeeding Reversion Date. The Company shall not pay, or permit its Subsidiaries to pay, any interest or principal on $361 million at any time outstandingof intercompany loans received by it and its Subsidiaries in November 2003 from CCO Holdings, all of which shall become a common equity capital contribution to the Company on the Guarantee and Pledge Date.
Appears in 1 contract
Sources: Indenture (CCH Ii Capital Corp)
Incurrence of Indebtedness and Issuance of Preferred Stock. (a) The Company shall will not, and shall will not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guaranty or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") Incur any Indebtedness (including Acquired Debt)other than the Notes, the Note Guarantees and other Indebtedness existing on the Closing Date) and the Company will not permit any of its Restricted Subsidiaries to issue any preferred stock; provided, however, that, so long as no Default or Event of Default has occurred and is continuing, that the Company and its Restricted Subsidiaries or any Subsidiary Guarantor may incur Incur Indebtedness (including including, without limitation, Acquired DebtIndebtedness) if if, after giving effect to the Incurrence of such Indebtedness and the receipt and application of the proceeds therefrom, the Fixed Charge Coverage Ratio for would be greater than 2.0:1.0.
(b) The provisions of Section 4.09(a) will not prohibit the Company's most recently ended four full fiscal quarters for which financial statements are available immediately preceding the date on which such additional Indebtedness is incurred would have been at least 2.0 to 1, determined on a pro forma basis (including a pro forma application incurrence of any of the net proceeds therefrom)following items of Indebtedness (collectively, as if the additional Indebtedness had been incurred at the beginning of such four-quarter period. The foregoing provisions will not apply to:“Permitted Debt”):
(i1) the incurrence by the Company and its Restricted Subsidiaries any Subsidiary Guarantor of additional Indebtedness pursuant to the Bank and letters of credit under Credit Facility Facilities in an aggregate principal amount not to exceed $50.0 million at any one time outstanding under this clause (1) (with letters of credit being deemed to have a principal amount equal to the maximum potential liability of the Company and such Subsidiary Guarantor thereunder) (together with refinancings thereof) not to exceed $2.6 billion less any Net Proceeds amount of Asset Sales applied to such Indebtedness permanently reduce the Bank Credit Facility pursuant to the provisions described in repaid as provided under Section 4.10;
(ii2) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;
Indebtedness owed (iiiA) the incurrence by the Company and its Restricted Subsidiaries of Indebtedness represented by the Senior Subordinated Notes and the Guarantees thereof by any Restricted Subsidiaries pursuant to the provisions in Section 12.01 hereof;
(iv) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented Subsidiary Guarantor evidenced by Capital Lease Obligations, mortgage financings an unsubordinated promissory note or purchase money obligations, in each case incurred for the purpose of financing all or (B) to any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of the Company or such Restricted Subsidiary, in an aggregate principal amount not to exceed $5.0 million at any time outstanding;
(v) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness in connection with the acquisition of assets or a new other Restricted Subsidiary; provided that such Indebtedness was incurred by the prior owner of such assets or such Restricted Subsidiary prior to such acquisition by the Company or one of its Restricted Subsidiaries and was not incurred in connection with, or in contemplation of, such acquisition by the Company or one of it Restricted Subsidiaries; and provided further that the principal amount (or accreted value, as applicablex) of such Indebtedness, together with any other outstanding Indebtedness incurred pursuant to this clause (v), does not exceed $5.0 million;
(vi) the incurrence of intercompany Indebtedness between or among the Company and any of its Wholly Owned Restricted Subsidiaries; provided, that any subsequent issuance or transfer of Equity Interests that event which results in any such Restricted Subsidiary ceasing to be a Restricted Subsidiary or any subsequent transfer of such Indebtedness being held by a Person (other than to the Company or a Wholly Owned another Restricted Subsidiary Subsidiary) shall be deemed, in each case, to constitute an Incurrence of such Indebtedness not permitted by this clause (2) and (y) if the Company or any sale or other transfer of any Subsidiary Guarantor is the obligor on such Indebtedness, such Indebtedness must be expressly subordinated in right of payment to a Person that is neither the Notes, in the case of the Company, or a Wholly Owned Restricted Subsidiary of the CompanyNote Guarantee, shall be deemed to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as in the case may beof a Subsidiary Guarantor;
(vii3) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Debt Indebtedness issued in exchange for, or the net proceeds of which are used to extendrefinance or refund, refinancethen outstanding Indebtedness including the Notes (other than Indebtedness outstanding under clauses (1), renew(2), replace(5), defease (6), (7), (8), (9) and (13) and any refinancings thereof) in an amount not to exceed the amount so refinanced or refunded (plus premiums, accrued interest, fees and expenses); provided that (a) Indebtedness the proceeds of which are used to refinance or refund the Notes or Indebtedness that was is pari passu with, or subordinated in right of payment to, the Notes or a Note Guarantee shall only be permitted by under this Indenture clause (3) if (x) in case the Notes are refinanced in part or the Indebtedness to be incurredrefinanced is pari passu with the Notes or a Note Guarantee, such new Indebtedness, by its terms or by the terms of any agreement or instrument pursuant to which such new Indebtedness is outstanding, is pari passu with, or expressly subordinate in right of payment to, the remaining Notes or the Note Guarantee, or (y) in case the Indebtedness to be refinanced is subordinated in right of payment to the Notes or a Note Guarantee, such new Indebtedness, by its terms or by the terms of any agreement or instrument pursuant to which such new Indebtedness is issued or remains outstanding, is expressly made subordinate in right of payment to the Notes or the Note Guarantee at least to the extent that the Indebtedness to be refinanced is subordinated to the Notes or the Note Guarantee, (b) such new Indebtedness, determined as of the date of Incurrence of such new Indebtedness, does not mature prior to the Stated Maturity of the Indebtedness to be refinanced or refunded, and the Average Life of such new Indebtedness is at least equal to the remaining Average Life of the Indebtedness to be refinanced or refunded and (c) such new Indebtedness is Incurred by the Company or a Subsidiary Guarantor or by the Restricted Subsidiary that is the obligor on the Indebtedness to be refinanced or refunded;
(viii4) the incurrence by Indebtedness of the Company's Unrestricted Subsidiaries of Non-Recourse Debt; provided, that if, and to the extent any such Indebtedness ceases the net proceeds thereof are promptly (A) used to be Non-Recourse Debt purchase Notes tendered in an Offer to Purchase made as a result of an Unrestricted Subsidiary, such event shall be deemed a Change in Control or (B) deposited to constitute an incurrence defease the Notes as described under Article 8 and Article 12;
(5) Guarantees of the Notes and Guarantees of Indebtedness of the Company or any Restricted Subsidiary of the Company by a any other Restricted Subsidiary of the Company.
(ix) ; provided the incurrence by the Company or any Guarantee of its Restricted Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk with respect to any floating rate indebtedness that such Indebtedness is permitted by the terms of this Indenture to be outstanding; andand made in accordance with Section 4.19;
(x6) Indebtedness arising from the incurrence honoring by a bank or other financial institution of a check, draft or similar instrument inadvertently (except in the case of daylight overdrafts) drawn against insufficient funds in the ordinary course of business provided, however, that such Indebtedness is extinguished within two business days of incurrence;
(7) Indebtedness (i) in respect of industrial revenue bonds or other similar governmental or municipal bonds, (ii) evidencing the deferred purchase price of newly acquired property or incurred to finance the acquisition of equipment of the Company and its Restricted Subsidiaries (pursuant to purchase money mortgages or otherwise, whether owed to the seller or a third party) used in the ordinary course of additional business of the Company and its Restricted Subsidiaries (provided that, such Indebtedness is incurred within 270 days of the acquisition of such property) and (iii) in an respect of Capitalized Lease Obligations; provided that, the aggregate amount of all Indebtedness outstanding pursuant to this clause shall not to exceed $7.5 million at any time outstanding.exceed $180 million;
Appears in 1 contract
Incurrence of Indebtedness and Issuance of Preferred Stock. The Company shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectlyindirectly to, create, incur, issue, assume, guaranty guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") any Indebtedness (including Acquired Debt), and that the Company will not issue any Disqualified Stock and will not permit any of its Restricted Subsidiaries to issue any shares of preferred stock; provided, however, that, so long as no Default or Event of Default has occurred and is continuing, that the Company and its or any Restricted Subsidiaries Subsidiary that is a Guarantor may incur Indebtedness (including Acquired Debt) and the Company may issue shares of Disqualified Stock if the Fixed Charge Coverage Ratio for the Company's most recently ended four full fiscal quarters for which internal financial statements are available immediately preceding the date on which such additional Indebtedness is incurred or such Disqualified Stock is issued would have been at least 2.0 to 11.0, determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the additional Indebtedness had been incurred incurred, or the Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period. The foregoing provisions of the first paragraph of this covenant will not apply to:to the incurrence of any of the following items of Indebtedness (collectively, "Permitted Debt"):
(ia) the incurrence by the Company or any Restricted Subsidiary of Indebtedness under Credit Facilities; provided that the aggregate principal amount of all Indebtedness (with letters of credit issued under Credit Facilities being deemed to have a principal amount equal to the maximum potential liability of the Company and its Restricted Subsidiaries thereunder) outstanding under all Credit Facilities after giving effect to such incurrence, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any other Indebtedness pursuant to this clause (a), does not exceed an amount equal to the greater of (x) (A) $20.0 million of such Indebtedness plus, if and only if the amount of such Indebtedness includes letters of credit, an additional amount equal to the amount of such letters of credit then outstanding, up to a maximum additional amount of $5.0 million less (B) the aggregate amount of all Net Proceeds of Asset Sales applied to permanently reduce the commitments with respect to Credit Facilities pursuant to Section 4.10 hereof and (y) the Borrowing Base;
(b) the incurrence by the Company and its Restricted Subsidiaries of Indebtedness pursuant to the Bank Credit Facility in an aggregate principal amount not to exceed $50.0 million at any one time outstanding less any Net Proceeds of Asset Sales applied to permanently reduce the Bank Credit Facility pursuant to the provisions described in Section 4.10Existing Indebtedness;
(iic) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;
(iii) the incurrence by the Company and its Restricted Subsidiaries of Indebtedness represented by the Senior Subordinated Notes and the Guarantees thereof incurrence by any Restricted Subsidiaries pursuant to the provisions in Section 12.01 hereofGuarantors of the Subsidiary Guarantees;
(ivd) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of the Company or such Restricted Subsidiary, in an aggregate principal amount amount, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace Indebtedness incurred pursuant to this clause (d), not to exceed $5.0 2.5 million at any time outstanding;
(ve) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in connection with exchange for, or the acquisition net proceeds of assets which are used to refund, refinance or a new Restricted Subsidiary; provided replace, Indebtedness that such Indebtedness was incurred permitted by the prior owner Indenture to be incurred under the first paragraph of such assets this covenant or such Restricted Subsidiary prior to such acquisition clauses (b) and (c) of this paragraph;
(f) the incurrence by the Company or one any of its Restricted Subsidiaries and was not incurred in connection with, or in contemplation of, such acquisition by the Company or one of it Restricted Subsidiaries; and provided further that the principal amount (or accreted value, as applicable) of such Indebtedness, together with any other outstanding Indebtedness incurred pursuant to this clause (v), does not exceed $5.0 million;
(vi) the incurrence of intercompany Indebtedness between or among the Company and any of its Wholly Owned Restricted Subsidiaries; provided, however, that (i) if the Company or any Guarantor is the obligor on such Indebtedness, such Indebtedness is expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes or the Subsidiary Guarantee of such Guarantor and (ii)(A) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Wholly Owned Restricted Subsidiary of the Company or and (B) any sale or other transfer of any such Indebtedness to a Person that is neither not either the Company, Company or a Wholly Owned Restricted Subsidiary of the Company, that is a Guarantor shall be deemed deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be, that was not permitted solely by reason of this clause (f);
(vii) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Debt in exchange for, or the net proceeds of which are used to extend, refinance, renew, replace, defease or refund Indebtedness that was permitted by this Indenture to be incurred;
(viii) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt; provided, that if, and to the extent any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company.
(ixg) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are incurred in the ordinary course of business for the purpose of fixing or hedging currency, commodity or interest rate risk (including with respect to any floating rate indebtedness Indebtedness that is permitted by the terms of this Indenture to be outstanding; and) in connection with the conduct of their respective businesses and not for speculative purposes;
(xh) the guarantee by the Company or any of the Guarantors of Indebtedness of the Company or a Restricted Subsidiary that was permitted to be incurred by another provision of this covenant;
(i) Indebtedness incurred by the Company or any Restricted Subsidiary under payment or performance bonds, surety bonds, letter of credit obligations to provide security for worker's compensation claims, payment obligations in connection with self-insurance or similar requirements and bank overdrafts incurred in the ordinary course of business, in each case including Indebtedness represented by reimbursement obligations incurred in connection therewith; provided that any Obligations arising in connection with such bank overdraft Indebtedness is extinguished within five business days;
(j) Indebtedness incurred by the Company or any Restricted Subsidiary arising from Guarantees or letters of credit, surety bonds or payment or performance bonds securing any Obligations of the Company or any Restricted Subsidiary pursuant to agreements providing for indemnification, adjustment of purchase price or similar obligations, in any case in connection with the disposition of any business, assets or Subsidiary (including without limitation an Asset Sale) other than guarantees of 44 Indebtedness incurred by any Person acquiring all or any portion of such business, assets or Subsidiary (including without limitation an Asset Sale) for the purpose of financing such acquisition, in a principal amount not to exceed the gross proceeds (with proceeds other than cash or Cash Equivalents being valued at the fair market value thereof as determined by the Board of Directors in good faith) actually received by the Company or any Restricted Subsidiary in connection with such dispositions;
(k) the incurrence by the Company and its or any of the Restricted Subsidiaries of additional Indebtedness in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any other Indebtedness incurred pursuant to this clause (k) and not otherwise permitted to be incurred at the time of incurrence of any such Permitted Refinancing Indebtedness, not to exceed $7.5 12.5 million outstanding at any one time; and
(l) the incurrence of Indebtedness of the Company to the estate of any Principal, which Indebtedness is (a) subordinated in right of payment to payment of all amounts payable with respect to the Notes, (b) matures not earlier than 91 days after the maturity date of the Notes, (c) includes no mandatory sinking fund or other requirement for payment of principal or cash interest prior to the maturity date of the Notes, (d) is not subject to redemption or prepayment at the option of the holder thereof, and (e) is in an aggregate principal amount no greater than the amount by which the redemption price for the Equity Interests of the decedent Principal pursuant to an agreement to which the Company is a party exceeds the proceeds received by the Company on the life of the decedent Principal. For purposes of determining compliance with this covenant, in the event that an item of Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (a) through (k) above or is entitled to be incurred pursuant to the first paragraph of this covenant, the Company shall, in its sole discretion, classify such item of Indebtedness from time outstandingto time in any manner that complies with this covenant and such item of Indebtedness will be treated as having been incurred pursuant to only one of such clauses or pursuant to the first paragraph hereof at any given time. Accrual of interest, the accretion of accreted value and the payment of interest in the form of additional Indebtedness will not be deemed to be an incurrence of Indebtedness for purposes of this covenant.
Appears in 1 contract
Incurrence of Indebtedness and Issuance of Preferred Stock. The Company shall will not, and shall will not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guaranty guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") any Indebtedness (including Acquired Debt)) and that the Company shall not issue any Disqualified Stock and shall not permit any of its Restricted Subsidiaries to issue any shares of preferred stock; provided, however, that, so long as no Default or Event of Default has occurred and is continuing, that (a) the Company and its Restricted Subsidiaries any Guarantor may incur Indebtedness (including Acquired Debt), (b) if the Company may issue shares of Disqualified Stock or (c) a Restricted Subsidiary may incur Acquired Debt, if, in each case, the Company's Fixed Charge Coverage Ratio for the Company's most recently ended four full fiscal quarters for which internal financial statements are available immediately preceding the date on which such additional Indebtedness is incurred or such Disqualified Stock is issued would have been at least 2.0 2.25 to 1, determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the additional Indebtedness had been incurred incurred, or the Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period. The foregoing provisions will of the first paragraph of this covenant shall not apply to:to the incurrence of any of the following items of Indebtedness (collectively, "Permitted Debt"):
(i) the incurrence by the Company and its Restricted Subsidiaries the Guarantors of Indebtedness pursuant to represented by the Bank Credit Facility in an aggregate principal amount not to exceed $50.0 million at any one time outstanding less any Net Proceeds of Asset Sales applied to permanently reduce Notes and the Bank Credit Facility pursuant to the provisions described in Section 4.10Subsidiary Guarantees;
(ii) the incurrence by the Company of Indebtedness and letters of credit pursuant to any Credit Facility (with letters of credit being deemed to have a principal amount equal to the maximum potential liability of the Company thereunder) in an aggregate principal amount not to exceed $75,000,000, less the sum of (a) the amount of Purchase Money Indebtedness incurred by the Company or any of its Restricted Subsidiaries under clause (vi) below and outstanding and (b) the aggregate amount of all proceeds of Assets Sales that have been applied since the Existing IndebtednessIssue Date to permanently reduce the outstanding amount of such Indebtedness pursuant to Section 4.10 hereof;
(iii) the incurrence by the Company and or any of its Restricted Subsidiaries of Indebtedness represented by the Senior Subordinated Notes and the Guarantees thereof by any Restricted Subsidiaries pursuant to the provisions in Section 12.01 hereofExisting Indebtedness;
(iv) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness represented in exchange for, or the net proceeds of which are used to extend, refinance, renew, replace, defease or refund, Indebtedness that was permitted by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of the Company or such Restricted Subsidiary, in an aggregate principal amount not Indenture to exceed $5.0 million at any time outstandingbe incurred;
(v) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness in connection with the acquisition of assets or a new Restricted Subsidiary; provided that such Indebtedness was incurred by the prior owner of such assets or such Restricted Subsidiary prior to such acquisition by the Company or one of its Restricted Subsidiaries and was not incurred in connection with, or in contemplation of, such acquisition by the Company or one of it Restricted Subsidiaries; and provided further that the principal amount (or accreted value, as applicable) of such Indebtedness, together with any other outstanding Indebtedness incurred pursuant to this clause (v), does not exceed $5.0 million;
(vi) the incurrence of intercompany Indebtedness between or among the Company and any of its Wholly Owned Restricted Subsidiaries; provided, however, that (i) if the Company or any Guarantor is the obligor on such Indebtedness, such Indebtedness is expressly subordinate to the payment in full of all Obligations with respect to the Notes and (ii) (A) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Wholly Owned Restricted Subsidiary of the Company or and (B) any sale or other transfer of any such Indebtedness to a Person that is neither not either the Company, Company or a Wholly Owned Restricted Subsidiary of the Company, shall be deemed deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be;
(vi) the incurrence by the Company or any of its Restricted Subsidiaries of Purchase Money Indebtedness, in an aggregate principal amount (or amount of Capital Lease Obligations), including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace Purchase Money Indebtedness incurred pursuant to this clause (vi), not to exceed $45,000,000 at any time outstanding;
(vii) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Debt obligations in exchange for, or the net proceeds ordinary course of business under (A) trade letters of credit which are used to extend, refinance, renew, replace, defease or refund Indebtedness that was permitted by this Indenture to be incurred;
(viii) repaid in full not more than one year after the incurrence date on which such Indebtedness is originally incurred to finance the purchase of goods by the Company's Unrestricted Subsidiaries of Non-Recourse Debt; provided, that if, and to the extent any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by Company or a Restricted Subsidiary of the Company.; (B) standby letters of credit issued for the purpose of supporting (1) workers' compensation liabilities of the Company or any of its Restricted Subsidiaries, or (2) performance, payment, deposit or surety obligations of the Company or any of its Restricted Subsidiaries; and (C) bid, advance payment and performance bonds and surety bonds of the Company and its Restricted Subsidiaries, and refinancings thereof;
(ixviii) the incurrence by the Company or any of its Restricted Subsidiaries of (x) Financial Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk (including with respect to any floating rate indebtedness Indebtedness that is permitted by the terms of this the Indenture to be outstanding; ), but only to the extent such obligations do not exceed 105% of the aggregate principal amount of the Indebtedness to which such obligations relate, and (y) Currency Hedging Obligations in connection with the conduct of the Permitted Business in currencies other than the United States Dollar, and
, in the case of clauses (x) and (y) not for speculative purposes and incurred in the incurrence ordinary course of business consistent with prudent business practices;
(ix) the guarantee by the Company and its or any Restricted Subsidiaries Subsidiary of additional Indebtedness in an aggregate amount not the Company or a Restricted Subsidiary of the Company that was permitted to exceed $7.5 million at any time outstanding.be incurred by
Appears in 1 contract
Sources: Indenture (Gulfmark Offshore Inc)
Incurrence of Indebtedness and Issuance of Preferred Stock. The Company shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guaranty guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incurINCUR") any Indebtedness (including Acquired Debt); provided, however, that, so long as no Default or Event of Default has occurred ) and is continuing, that the Company shall not issue any Disqualified Stock and shall not permit any of its Restricted Subsidiaries to issue any shares of preferred stock; PROVIDED, HOWEVER, that the Company may incur Indebtedness (including Acquired Debt) or issue shares of Disqualified Stock and any of the Company's Restricted Subsidiaries may incur Indebtedness if the Company's Fixed Charge Coverage Ratio for the Company's most recently ended four full fiscal quarters for which internal financial statements are available immediately preceding the date on which such additional Indebtedness is incurred or such Disqualified Stock is issued would have been at least 2.0 2.00 to 1, determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the additional Indebtedness had been incurred incurred, or the Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period. The foregoing provisions will of the first paragraph of this Section 4.09 shall not apply to:to the incurrence of any of the following items of Indebtedness (collectively, "PERMITTED DEBT"):
(i) the incurrence by the Company or its Restricted Subsidiaries of term Indebtedness under the Credit Facility, letters of credit (with letters of credit being deemed to have a principal amount equal to the maximum potential liability of the Company and its Restricted Subsidiaries of Indebtedness pursuant to thereunder) and related Guarantees under the Bank Credit Facility in an Facility; PROVIDED that the aggregate principal amount of all term Indebtedness and letters of credit of the Company and its Restricted Subsidiaries (with letters of credit being deemed to have a principal amount equal to the maximum potential liability of the Company and its Restricted Subsidiaries thereunder) outstanding under the Credit Facility after giving effect to such incurrence, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any other Indebtedness incurred pursuant to this clause (i) does not exceed an amount equal to $550.0 million;
(ii) the incurrence by the Company or its Restricted Subsidiaries of revolving credit Indebtedness under the Credit Facility, letters of credit (with letters of credit being deemed to have a principal amount equal to the maximum potential liability of the Company and its Restricted Subsidiaries thereunder) and related Guarantees under the Credit Facility; PROVIDED that the aggregate principal amount of all revolving Indebtedness and letters of credit of the Company and its Restricted Subsidiaries (with letters of credit being deemed to have a principal amount equal to the maximum potential liability of the Company and its Restricted Subsidiaries thereunder) outstanding under the Credit Facility after giving effect to such incurrence, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any other Indebtedness incurred pursuant to this clause (ii), does not exceed $50.0 700.0 million at any one time outstanding less any Net Proceeds the aggregate amount of Asset Sales Sale proceeds applied by the Company and its Restricted Subsidiaries to permanently reduce the Bank availability of revolving credit Indebtedness under the Credit Facility Agreements pursuant to the provisions described in of Section 4.104.10 hereof;
(iiiii) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;
(iiiiv) the incurrence by the Company and its Restricted Subsidiaries the Guarantors of Indebtedness represented by the Senior Notes, the Senior Subordinated Notes Notes, the Senior Subsidiary Guarantees and the Subordinated Subsidiary Guarantees thereof by any Restricted Subsidiaries pursuant limited in aggregate principal amount, without duplication, to amounts outstanding under the provisions in Section 12.01 hereofSenior Note Indenture and this Senior Subordinated Note Indenture as of their respective dates;
(ivv) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of the Company or such Restricted Subsidiary, in an aggregate principal amount amount, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace Indebtedness incurred pursuant to this clause (v), not to exceed $5.0 million at any time outstanding5% of Total Assets;
(vvi) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness in connection with Permitted Refinancing Indebtedness;
(vii) the acquisition of assets or a new Restricted Subsidiary; provided that such Indebtedness was incurred by the prior owner of such assets or such Restricted Subsidiary prior to such acquisition incurrence by the Company or one any of its Restricted Subsidiaries and was not incurred in connection with, or in contemplation of, such acquisition by the Company or one of it Restricted Subsidiaries; and provided further that the principal amount (or accreted value, as applicable) of such Indebtedness, together with any other outstanding Indebtedness incurred pursuant to this clause (v), does not exceed $5.0 million;
(vi) the incurrence of intercompany Indebtedness between or among the Company and any of its Wholly Owned Restricted Subsidiaries; providedPROVIDED, HOWEVER, that (i) if the Company is the obligor on such Indebtedness, such Indebtedness is expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Senior Subordinated Note and this Senior Subordinated Note Indenture, (ii) if a Restricted Subsidiary of the Company is the obligor on such Indebtedness, such Indebtedness is expressly subordinated to the prior payment in full in cash of such Restricted Subsidiary's Senior Subsidiary Guarantee and (iii)(A) any subsequent event or issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Wholly Owned Restricted Subsidiary of the Company or and (B) any sale or other transfer of any such Indebtedness to a Person that is neither not either the Company, Company or a Wholly Owned Restricted Subsidiary of the Company, Company shall be deemed deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be;
(vii) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Debt in exchange for, or the net proceeds of which are used to extend, refinance, renew, replace, defease or refund Indebtedness that was not permitted by this Indenture to be incurredclause (vii);
(viii) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt; provided, that if, and to the extent any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company.
(ix) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are incurred in the normal course of business for the purpose of fixing or hedging currency, commodity or interest rate risk (including with respect to any floating rate indebtedness Indebtedness that is permitted by the terms of this Senior Subordinated Note Indenture to be outstanding; andoutstanding in connection with the conduct of their respective businesses and not for speculative purposes);
(ix) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness in the ordinary course of business solely in respect of performance, surety and similar bonds, completion or performance guarantees or standby letters of credit issued for the purpose of supporting workers' compensation liabilities of the Company or any of its Restricted Subsidiaries, to the extent that such incurrence does not result in the incurrence of any obligation for the payment of borrowed money to others;
(x) the incurrence of Indebtedness arising from agreements of the Company or a Restricted Subsidiary providing for indemnification, adjustment of purchase price or similar obligations, in each case, incurred or assumed in connection with the disposition of any business, assets or a Subsidiary;
(xi) the incurrence by a Restricted Subsidiary of the Company of Indebtedness in connection with and in contemplation of, the concurrent disposition of such Restricted Subsidiary to the stockholders of the Company; PROVIDED that such disposition occurs concurrently with such incurrence and following such disposition, neither the Company nor any of its Restricted Subsidiaries has any liability with respect to such Indebtedness;
(xii) the incurrence by a Securitization Entity of Indebtedness in a Qualified Securitization Transaction that is Non-Recourse Debt with respect to the Company and its other Restricted Subsidiaries (except for Standard Securitization Undertakings and Limited Originator Recourse);
(xiii) the guarantee by the Company and or any of the Guarantors of Indebtedness of the Company or a Restricted Subsidiary of the Company that was permitted to be incurred by another provision of this Section 4.09; and
(xiv) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any other Indebtedness incurred pursuant to this clause (xiv), not to exceed $7.5 million at 75.0 million. For purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (i) through (xiv) above as of the date of incurrence thereof or is entitled to be incurred pursuant to the first paragraph of this Section 4.09 as of the date of incurrence thereof, the Company shall, in its sole discretion, classify or reclassify such item of Indebtedness as of the date of incurrence thereof in any time outstandingmanner that complies with this Section 4.09 and such item of Indebtedness shall be treated as having been incurred pursuant to only one of such clauses or pursuant to the first paragraph of this Section 4.09. Accrual of interest, the accretion of accreted value and the payment of interest in the form of additional Indebtedness will not be deemed to be an incurrence of Indebtedness for purposes of this Section 4.09.
Appears in 1 contract
Incurrence of Indebtedness and Issuance of Preferred Stock. The Company shall will not, and shall will not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guaranty guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incurINCUR") any Indebtedness (including Acquired Debt), and the Company will not issue any Disqualified Stock, and the Company will not permit any of its Restricted Subsidiaries to issue any Disqualified Stock or preferred stock; provided, however, that, so long as no Default or Event of Default has occurred and is continuing, that the Company and its Restricted Subsidiaries any Guarantor may incur Indebtedness (including Acquired Debt) ), and the Company may issue Disqualified Stock, if the Fixed Charge Coverage Ratio for the Company's most recently ended four full fiscal quarters for which financial statements are available have been filed with the SEC in compliance with Section 4.03 immediately preceding the date on which such additional Indebtedness is incurred incurred, or such Disqualified Stock is issued, would have been at least 2.0 2.25 to 1, determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the additional Indebtedness had been incurred incurred, or such Disqualified Stock had been issued, at the beginning of such four-quarter period. The foregoing provisions Notwithstanding the foregoing, so long as no Default shall have occurred and be continuing or would be caused thereby, the first paragraph of this Section 4.09 will not apply to:prohibit the incurrence of any of the following items of Indebtedness (collectively, "PERMITTED DEBT"):
(i1) the incurrence by the Company and its Restricted Subsidiaries or any Guarantor of Indebtedness pursuant to under the Bank Credit Facility Agreement in an aggregate principal amount not to exceed $50.0 million at any one time outstanding (with letters of credit being deemed to have a principal amount equal to the maximum potential liability thereunder) not to exceed the amount of all borrowings and commitments thereunder on the Closing Date, plus $10.0 million, less any the aggregate amount of all Net Proceeds of Asset Sales applied to permanently reduce the Bank Credit Facility pursuant to the provisions described in Section 4.10;
(ii) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;
(iii) the incurrence by the Company and its Restricted Subsidiaries of Indebtedness represented by the Senior Subordinated Notes and the Guarantees thereof by any Restricted Subsidiaries pursuant to the provisions in Section 12.01 hereof;
(iv) the incurrence by the Company or any of its Restricted Subsidiaries to repay such Indebtedness and to effect a corresponding commitment reduction thereunder pursuant to Section 4.10 hereof;
(2) the incurrence by the Company and any Restricted Subsidiary of the Existing Indebtedness (including, without limitation, deferred purchase price obligations (whether or not contingent) under acquisition agreements in effect on the date of this Indenture);
(3) the incurrence by the Company and the Guarantors of Indebtedness represented by the Notes and the related Subsidiary Guarantees to be issued on the date hereof and the Exchange Notes and the related Subsidiary Guarantees to be issued pursuant to the Registration Rights Agreement;
(4) the incurrence by the Company or any Restricted Subsidiary of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of the Company or such Restricted Subsidiary, in an aggregate principal amount amount, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (4), not to exceed $5.0 10.0 million at any time outstanding;
(v5) the incurrence by the Company or any of the Restricted Subsidiary of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to refund, refinance or replace Indebtedness (other than intercompany Indebtedness) that was permitted to be incurred under the first paragraph of this Section 4.09 or clauses (2), (3), (4), or (14) of this paragraph;
(6) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness in connection with the acquisition of assets or a new Restricted Subsidiary; provided that such Indebtedness was incurred by the prior owner of such assets or such Restricted Subsidiary prior to such acquisition by the Company or one of its Restricted Subsidiaries and was not incurred in connection with, or in contemplation of, such acquisition by the Company or one of it Restricted Subsidiaries; and provided further that the principal amount (or accreted value, as applicable) of such Indebtedness, together with any other outstanding Indebtedness incurred pursuant to this clause (v), does not exceed $5.0 million;
(vi) the incurrence of intercompany Indebtedness between or among the Company and any of its Wholly Owned Restricted Subsidiaries; provided, that however, that:
(a) if the Company or any Guarantor is the obligor on such Indebtedness, such Indebtedness must be expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, in the case of the Company, or the Subsidiary Guarantee, in the case of a Guarantor; and
(i) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Wholly Owned Restricted Subsidiary of the Company or thereof and (ii) any sale or other transfer of any such Indebtedness to a Person that is neither not either the Company, Company or a Wholly Owned Restricted Subsidiary of the Companythereof, shall be deemed deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be, that was not permitted by this clause (6);
(vii) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Debt in exchange for, or the net proceeds of which are used to extend, refinance, renew, replace, defease or refund Indebtedness that was permitted by this Indenture to be incurred;
(viii) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt; provided, that if, and to the extent any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company.
(ix7) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are incurred under or with respect to (a) Interest Rate Agreements not for the purpose of fixing or hedging interest rate risk with respect to any floating rate indebtedness that is permitted speculation and (b) Currency Agreements entered into in the ordinary course of business and not for the purpose of speculation;
(8) the guarantee by the terms Company or any of the Guarantors of Indebtedness of the Company or a Restricted Subsidiary that was permitted to be incurred by another provision of this Indenture Section 4.09;
(9) the accrual of interest, the accretion or amortization of original issue discount and the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, and the payment of reasonable dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock, will not be deemed to be outstandingan incurrence of Indebtedness for purposes of this Section 4.09; andprovided, in each such case, that the amount thereof is included in Fixed Charges of the Company as accrued;
(x10) the incurrence of Indebtedness of the Company or any Restricted Subsidiary in respect of performance bonds and surety or appeal bonds entered into by the Company or such Restricted Subsidiary in the ordinary course of business;
(11) the incurrence of Indebtedness of the Company or any Restricted Subsidiary arising from the honoring by a bank or other financial institution of a check, draft or similar instrument inadvertently (except in the case of daylight overdrafts) drawn against insufficient funds in the ordinary course of business, provided that such Indebtedness is satisfied within 3 business days of incurrence;
(12) the incurrence of Indebtedness of the Company or any Restricted Subsidiary represented by letters of credit for the account of the Company or such Restricted Subsidiary, as the case may be, in order to provide security for workers' compensation claims, payment obligations in connection with self-insurance programs or similar requirements in the ordinary course of business;
(13) endorsements in the ordinary course of business of negotiable instruments for deposit or collection;
(14) the incurrence by the Company and its or any Restricted Subsidiaries Subsidiary of additional Indebtedness in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, not to exceed $7.5 million at 10.0 million. For purposes of determining compliance with this Section 4.09, in the event that any proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (1) through (13) above, or is entitled to be incurred pursuant to the first paragraph of this Section 4.09, the Company will be permitted to classify such item of Indebtedness on the date of its incurrence and, from time outstandingto time, reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09. Notwithstanding the foregoing, Indebtedness under Credit Facilities outstanding on the date on which Notes are first issued and authenticated hereunder shall be deemed to have been incurred on such date in reliance on the exception provided by clause (1) of the definition of Permitted Debt.
Appears in 1 contract
Sources: Indenture (Aaipharma Inc)