BORROWERS MAY MAKE DISTRIBUTIONS IN CASH OR OTHER PROPERTY BUT
ONLY TO THE EXTENT OF ARC'S DISTRIBUTABLE SHARE OF EACH OF THE BORROWER'S NET
TAXABLE INCOME AND GAIN (AS DETERMINED FOR FEDERAL INCOME TAX PURPOSES) WITH
RESPECT TO SUCH TAXABLE YEAR, AND ONLY TO THE EXTENT REASONABLY NECESSARY FOR
ARC TO SATISFY ITS ARC DISTRIBUTION REQUIREMENT WITH RESPECT TO SUCH TAXABLE
YEAR.
SECTION 7.05
INVESTMENTS.
THE BORROWERS SHALL
NOT, AND SHALL NOT PERMIT ANY OF THEIR SUBSIDIARIES TO, PURCHASE, MAKE, INCUR,
ASSUME OR PERMIT TO EXIST ANY INVESTMENT IN ANY OTHER PERSON OTHER THAN
PERMITTED INVESTMENTS.
SECTION 7.06
ISSUANCE OF CAPITAL STOCK.
THE
BORROWERS SHALL NOT, AND SHALL NOT PERMIT ANY OF THEIR SUBSIDIARIES TO,
(I) ISSUE ANY CAPITAL STOCK (WHETHER FOR VALUE OR OTHERWISE) TO ANY PERSON OTHER
THAN (IN THE CASE OF SUBSIDIARIES) A BORROWER OR A PARENT GUARANTOR OR ANOTHER
WHOLLY OWNED SUBSIDIARY OR (II) BECOME LIABLE IN RESPECT OF ANY OBLIGATION
(CONTINGENT OR OTHERWISE) TO PURCHASE, REDEEM, RETIRE, ACQUIRE OR MAKE ANY OTHER
PAYMENT IN RESPECT OF ANY CAPITAL STOCK OF THE BORROWERS OR ANY SUBSIDIARY OR
ANY OPTION, WARRANT OR OTHER RIGHT TO ACQUIRE ANY SUCH CAPITAL STOCK.
SECTION 7.07
PROHIBITION OF FUNDAMENTAL CHANGES.
NO BORROWER SHALL ENTER INTO ANY TRANSACTION OF MERGER OR CONSOLIDATION OR
AMALGAMATION, OR LIQUIDATE, WIND UP OR DISSOLVE ITSELF (OR SUFFER ANY
LIQUIDATION, WINDING UP OR DISSOLUTION) OR SELL ALL OR SUBSTANTIALLY ALL OF ITS
ASSETS OTHER THAN A PERMITTED CONSOLIDATION.
53
SECTION 7.08
PERMITTED DISPOSITIONS.
THE
BORROWERS SHALL NOT, AND SHALL NOT PERMIT ANY OF ITS SUBSIDIARIES TO, DISPOSE OF
ANY OF THE BORROWERS' OR SUCH SUBSIDIARIES' ASSETS (INCLUDING ACCOUNTS
RECEIVABLE AND CAPITAL STOCK OF SUBSIDIARIES) TO ANY PERSON IN ONE TRANSACTION
OR SERIES OF TRANSACTIONS UNLESS SUCH DISPOSITION IS A PERMITTED DISPOSITION.
SECTION 7.09
TRANSACTIONS WITH AFFILIATES.
THE
BORROWERS SHALL NOT, AND SHALL NOT PERMIT ANY OF THEIR SUBSIDIARIES TO, ENTER
INTO OR CAUSE OR PERMIT TO EXIST ANY ARRANGEMENT, TRANSACTION OR CONTRACT
(INCLUDING FOR THE PURCHASE, LEASE OR EXCHANGE OF PROPERTY OR THE RENDERING OF
SERVICES) WITH ANY OF ITS OTHER AFFILIATES, UNLESS SUCH ARRANGEMENT, TRANSACTION
OR CONTRACT (I) IS ON FAIR AND REASONABLE TERMS NO LESS FAVORABLE TO THE
BORROWERS OR SUCH SUBSIDIARY THAN IT COULD OBTAIN IN AN ARM'S-LENGTH TRANSACTION
WITH A PERSON THAT IS NOT AN AFFILIATE OR (II) IS A PERMITTED AFFILIATE
TRANSACTION.
SECTION 7.10
RESTRICTIVE AGREEMENTS, ETC.
THE
BORROWERS SHALL NOT, AND SHALL NOT PERMIT ANY OF THEIR SUBSIDIARIES TO, ENTER
INTO ANY AGREEMENT PROHIBITING
(A)
THE CREATION OR ASSUMPTION OF ANY LIEN UPON
ITS PROPERTIES, REVENUES OR ASSETS, WHETHER NOW OWNED OR HEREAFTER ACQUIRED;
(B)
THE ABILITY OF ANY OBLIGOR TO AMEND OR
OTHERWISE MODIFY ANY LOAN DOCUMENT; OR
(C)
THE ABILITY OF ANY SUBSIDIARY TO MAKE ANY
PAYMENTS, DIRECTLY OR INDIRECTLY, TO THE BORROWERS, INCLUDING BY WAY OF
DIVIDENDS, ADVANCES, REPAYMENTS OF LOANS, REIMBURSEMENTS OF MANAGEMENT AND OTHER
INTERCOMPANY CHARGES, EXPENSES AND ACCRUALS OR OTHER RETURNS ON INVESTMENTS;
provided, that the foregoing prohibitions shall not apply to restrictions
imposed