CONTINGENT OBLIGATIONS.
NEITHER THE
BORROWER NOR ANY OF ITS SUBSIDIARIES SHALL DIRECTLY OR INDIRECTLY CREATE OR
BECOME OR BE LIABLE WITH RESPECT TO ANY CONTINGENT OBLIGATION, EXCEPT:
(I)
RECOURSE OBLIGATIONS RESULTING FROM ENDORSEMENT OF NEGOTIABLE INSTRUMENTS FOR
COLLECTION IN THE ORDINARY COURSE OF BUSINESS; (II) PERMITTED EXISTING
CONTINGENT OBLIGATIONS; (III) OBLIGATIONS, WARRANTIES, GUARANTEES AND
INDEMNITIES, NOT RELATING TO INDEBTEDNESS OF ANY PERSON, WHICH HAVE BEEN OR ARE
UNDERTAKEN OR MADE IN THE ORDINARY COURSE OF BUSINESS AND NOT FOR THE BENEFIT OF
OR IN FAVOR OF AN AFFILIATE OF THE BORROWER OR SUCH SUBSIDIARY; (IV) CONTINGENT
OBLIGATIONS WITH RESPECT TO SURETY, APPEAL AND PERFORMANCE BONDS OBTAINED BY THE
BORROWER OR ANY SUBSIDIARY IN THE ORDINARY COURSE OF BUSINESS; (V) CONTINGENT
OBLIGATIONS OF THE SUBSIDIARY GUARANTORS UNDER THE SUBSIDIARY GUARANTY; (VI)
OBLIGATIONS ARISING UNDER OR RELATED TO THE LOAN DOCUMENTS; (VII) CONTINGENT
OBLIGATIONS IN RESPECT OF REPRESENTATIONS AND WARRANTIES CUSTOMARILY GIVEN IN
RESPECT OF ASSET SALES OTHERWISE PERMITTED HEREUNDER; AND (VIII) CONTINGENT
OBLIGATIONS, IN AN AGGREGATE AMOUNT NOT TO EXCEED $3,000,000, ARISING AS A
RESULT OF THE GUARANTY OF ANY INDEBTEDNESS NOT DESCRIBED IN CLAUSES (I) THROUGH
(IX) HEREOF AND OTHERWISE PERMITTED UNDER SECTION 7.3(A).
(F)
RESTRICTED PAYMENTS.
THE BORROWER SHALL NOT
DECLARE OR MAKE ANY RESTRICTED PAYMENT IF EITHER A DEFAULT OR AN UNMATURED
DEFAULT SHALL HAVE OCCURRED AND BE CONTINUING AT THE DATE OF DECLARATION OR
PAYMENT THEREOF OR WOULD RESULT THEREFROM.
(G)
CONDUCT OF BUSINESS; SUBSIDIARIES;
ACQUISITIONS.
NEITHER THE BORROWER NOR ANY OF ITS SUBSIDIARIES SHALL ENGAGE IN
ANY BUSINESS OTHER THAN THE BUSINESSES ENGAGED IN BY THE BORROWER ON THE DATE
HEREOF AND ANY BUSINESS OR ACTIVITIES WHICH ARE REASONABLY SIMILAR, RELATED OR
INCIDENTAL THERETO OR LOGICAL EXTENSIONS THEREOF.
THE BORROWER SHALL NOT
CREATE, ACQUIRE OR CAPITALIZE ANY SUBSIDIARY AFTER THE DATE HEREOF UNLESS (I) NO
DEFAULT OR UNMATURED DEFAULT
65
WHICH IS NOT BEING CURED SHALL HAVE OCCURRED AND BE CONTINUING OR WOULD RESULT
THEREFROM; (II) AFTER SUCH CREATION, ACQUISITION OR CAPITALIZATION, ALL OF THE
REPRESENTATIONS AND WARRANTIES CONTAINED HEREIN SHALL BE TRUE AND CORRECT IN ALL
MATERIAL RESPECTS (UNLESS SUCH REPRESENTATION AND WARRANTY IS MADE AS OF A
SPECIFIC DATE, IN WHICH CASE, SUCH REPRESENTATION OR WARRANTY SHALL BE TRUE IN
ALL MATERIAL RESPECTS AS OF SUCH DATE); AND (III) AFTER SUCH CREATION,
ACQUISITION OR CAPITALIZATION THE BORROWER SHALL BE IN COMPLIANCE WITH THE TERMS
OF SECTION 7.2(K) AND SECTION 7.3(L).
THE BORROWER SHALL NOT MAKE ANY
ACQUISITIONS WITHOUT APPROVAL BY THE REQUIRED LENDERS; PROVIDED THAT BORROWER
SHALL NOT NEED THE APPROVAL OF THE REQUIRED LENDERS TO MAKE PERMITTED
ACQUISITIONS (AS DEFINED BELOW) OF UP TO (X) $5,000,000 IN AGGREGATE PURCHASE
PRICE IN THE FIRST TWELVE MONTH PERIOD IMMEDIATELY FOLLOWING THE DATE OF THIS
AGREEMENT, (II) $10,000,000 IN AGGREGATE PURCHASE PRICE IN THE SECOND TWELVE
MONTH PERIOD IMMEDIATELY FOLLOWING THE DATE OF THIS AGREEMENT, AND (III) UP TO
THE AMOUNT EQUAL TO 50% OF THE BORROWER'S TRAILING TWELVE MONTH EBITDA IN
AGGREGATE PURCHASE PRICE DURING ANY TWELVE MONTH PERIOD FROM AND AFTER THE END