WITH GAAP), OF GREATER THAN 1.00 TO 1.0.
9.14.4 MINIMUM NET INCOME.
AT, AND MEASURED AS OF, THE END OF EACH FISCAL YEAR,
PROFITABLE OPERATIONS.
9.15
CHANGE OF MANAGEMENT.
JIRKA RYSAVY SHALL AT ALL
TIMES BE GAIAM'S CHIEF EXECUTIVE OFFICER AND/OR CHAIRMAN (DEFINED AS THE PERSON
WHO PROPOSES AND IMPLEMENTS ALL SIGNIFICANT POLICIES REGARDING GAIAM'S
OPERATIONS AND WHO DIRECTS THE DAY TO DAY OPERATIONS OF GAIAM).
ARTICLE 10.
NEGATIVE COVENANTS
From and after the date of this Credit Agreement and until the Bank Debt is
indefeasibly paid in full, all Letters of Credit have expired, and Lender has no
obligation to make Revolving Advances and no obligation to issue Letters of
Credit hereunder, Borrower, and each of them, agrees to observe and comply with
the following covenants for the benefit of Lender:
10.1
BORROWING.
BORROWER SHALL NOT CREATE, INCUR,
ASSUME OR PERMIT TO EXIST, DIRECTLY OR INDIRECTLY, ANY INDEBTEDNESS, EXCEPT
FOR:
(A) INDEBTEDNESS OF BORROWER ARISING UNDER THIS CREDIT AGREEMENT AND THE
OTHER LOAN DOCUMENTS; (B) CURRENT OPERATING LIABILITIES (OTHER THAN FOR BORROWED
MONEY) INCURRED IN THE ORDINARY COURSE OF BUSINESS; (C) INDEBTEDNESS ON THE DATE
HEREOF AS SET FORTH IN EXHIBIT 10.1 ATTACHED HERETO; (D) INDEBTEDNESS
SUBORDINATED TO ALL BANK DEBT IN A MANNER ACCEPTABLE TO LENDER IN ITS SOLE
DISCRETION; (E) OTHER INDEBTEDNESS, INCLUDING, WITHOUT LIMITATION, INDEBTEDNESS
ARISING UNDER GUARANTEES PERMITTED UNDER SECTION 10.4 HEREOF AND INDEBTEDNESS
ARISING UNDER CAPITAL LEASES, IN A MAXIMUM AMOUNT OF PRINCIPAL OUTSTANDING AT
ANY ONE TIME OF $5,000,000.00; (F) INDEBTEDNESS CONSTITUTING ANY REFINANCING OR
REFUNDING OF INDEBTEDNESS DESCRIBED IN CLAUSES (D) AND (E) OF THIS SECTION,
PROVIDED THAT THE PRINCIPAL AMOUNT THEREOF DOES NOT INCREASE AS A RESULT OF ANY
SUCH REFINANCING OR REFUNDING FROM THE BALANCE OWING ON THE DATE HEREOF OR ON
THE DATE OF SUCH REFINANCING OR REFUNDING, WHICHEVER IS LOWER; AND
(G) INVESTMENTS PERMITTED BY SECTION 10.6 (TO THE EXTENT SUCH INVESTMENTS
CONSTITUTE INDEBTEDNESS BY VIRTUE OF BEING AN OBLIGATION TO SUPPLY FUNDS TO
INVEST IN ANY PERSON).
10.2
LIENS.
BORROWER WILL NOT CREATE, INCUR, ASSUME
OR SUFFER TO EXIST ANY MORTGAGE, PLEDGE, LIEN, CHARGE OR OTHER ENCUMBRANCE ON,
OR ANY SECURITY INTEREST IN, ANY OF ITS REAL OR PERSONAL PROPERTIES (INCLUDING,
WITHOUT LIMITATION,
34
LEASEHOLD INTERESTS, LEASEHOLD IMPROVEMENTS AND ANY OTHER INTEREST IN REAL
PROPERTY OR FIXTURES), NOW OWNED OR HEREAFTER ACQUIRED, EXCEPT:
(A)
LIENS FOR TAXES OR OTHER GOVERNMENTAL
CHARGES WHICH ARE NOT DUE OR REMAIN PAYABLE WITHOUT PENALTY, OR ARE BEING
CONTESTED IN GOOD FAITH BY APPROPRIATE ACTIONS OR PROCEEDINGS; PROVIDED THAT
SUCH RESERVES OR OTHER APPROPRIATE PROVISIONS, IF ANY, AS SHALL BE REQUIRED BY
GAAP, SHALL HAVE BEEN MADE FOR SUCH TAXES OR OTHER GOVERNMENTAL CHARGES;
(B)
DEPOSITS OR PLEDGES TO SECURE WORKMEN'S
COMPENSATION, UNEMPLOYMENT INSURANCE, OLD AGE BENEFITS OR OTHER SOCIAL SECURITY
OBLIGATIONS OR IN CONNECTION WITH OR TO SECURE THE PERFORMANCE OF BIDS, TENDERS,
TRADE CONTRACTS OR LEASES OR TO SECURE STATUTORY OBLIGATIONS OR SURETY OR APPEAL
BONDS OR OTHER PLEDGES OR DEPOSITS OF LIKE NATURE AND ALL IN THE ORDINARY