IS CONTINUING OR WOULD
RESULT THEREFROM, ANY SUBSIDIARY OF BORROWER (OTHER THAN PMG OR AN EXCLUDED
SUBSIDIARY) MAY MERGE INTO OR CONSOLIDATE WITH ANY OTHER PERSON OR PERMIT ANY
OTHER PERSON TO MERGE INTO OR CONSOLIDATE WITH IT; PROVIDED, HOWEVER, THAT IN
EACH CASE, IMMEDIATELY AFTER GIVING EFFECT THERETO IN THE CASE OF ANY SUCH
MERGER TO WHICH ANY LOAN PARTY IS A PARTY, SUCH LOAN PARTY IS THE SURVIVING
CORPORATION.
SECTION 7.05
DISPOSITIONS.
MAKE ANY DISPOSITION OR ENTER INTO ANY
AGREEMENT TO MAKE ANY DISPOSITION, EXCEPT:
(A)
DISPOSITIONS OF OBSOLETE, SURPLUS OR WORN OUT PROPERTY, WHETHER
NOW OWNED OR HEREAFTER ACQUIRED, IN THE ORDINARY COURSE OF BUSINESS;
(B)
DISPOSITIONS OF INVENTORY IN THE ORDINARY COURSE OF BUSINESS;
(C)
DISPOSITIONS OF EQUIPMENT TO THE EXTENT THAT (I) SUCH PROPERTY IS
EXCHANGED FOR CREDIT AGAINST THE PURCHASE PRICE OF SIMILAR REPLACEMENT PROPERTY
OR (II) THE PROCEEDS OF SUCH DISPOSITION ARE REASONABLY PROMPTLY APPLIED TO THE
PURCHASE PRICE OF SUCH REPLACEMENT PROPERTY;
(D)
DISPOSITIONS OF PROPERTY BY ANY SUBSIDIARY TO BORROWER OR TO A
WHOLLY-OWNED SUBSIDIARY (OTHER THAN AN EXCLUDED SUBSIDIARY); PROVIDED THAT IF
THE TRANSFEROR OF SUCH PROPERTY IS A GUARANTOR, THE TRANSFEREE THEREOF MUST
EITHER BE BORROWER OR A GUARANTOR;
87
(E)
DISPOSITIONS PERMITTED BY SECTION 7.04; AND
(F)
AS LONG AS THE 2014 NOTES ARE OUTSTANDING, DISPOSITIONS OF PARI
PASSU COLLATERAL TO THE EXTENT PERMITTED BY THE INDENTURE AS IN EFFECT ON THE
DATE HEREOF;
(G)
DISPOSITIONS (OTHER THAN OF REAL PROPERTY) BY BORROWER AND ANY OF
ITS SUBSIDIARIES NOT OTHERWISE PERMITTED UNDER THIS SECTION 7.05; PROVIDED THAT
(I) AT THE TIME OF SUCH DISPOSITION, NO DEFAULT SHALL EXIST OR WOULD RESULT FROM
SUCH DISPOSITION AND (II) THE AGGREGATE BOOK VALUE OF ALL PROPERTY DISPOSED OF
IN RELIANCE ON THIS CLAUSE (G) IN ANY FISCAL YEAR SHALL NOT EXCEED $5,000,000;
provided, however, that any Disposition pursuant to Section 7.05(a) through
Section 7.05(g) shall be for fair market value.
SECTION 7.06
RESTRICTED PAYMENTS.
DECLARE OR MAKE, DIRECTLY OR
INDIRECTLY, ANY RESTRICTED PAYMENT, OR INCUR ANY OBLIGATION (CONTINGENT OR
OTHERWISE) TO DO SO, OR ISSUE OR SELL ANY EQUITY INTERESTS OR ACCEPT ANY CAPITAL
CONTRIBUTIONS, EXCEPT THAT, SO LONG AS NO DEFAULT SHALL HAVE OCCURRED AND BE
CONTINUING AT THE TIME OF ANY ACTION DESCRIBED BELOW OR WOULD RESULT THEREFROM:
(A)
EACH SUBSIDIARY MAY MAKE RESTRICTED PAYMENTS TO (I) BORROWER AND
(II) ANY SUBSIDIARIES OF BORROWER THAT ARE GUARANTORS;
(B)
BORROWER AND EACH SUBSIDIARY MAY DECLARE AND MAKE DIVIDEND
PAYMENTS OR OTHER DISTRIBUTIONS PAYABLE SOLELY IN THE COMMON STOCK OR OTHER
COMMON EQUITY INTERESTS OF SUCH PERSON;
(C)
RESTRICTED PAYMENTS BY ANY LOAN PARTY OR ITS SUBSIDIARY TO ANY
OTHER LOAN PARTY IN AN AMOUNT NECESSARY TO FUND FEDERAL AND STATE INCOME TAXES
ATTRIBUTABLE TO THE TAXABLE INCOME OF SUCH LOAN PARTY FOR THE SOLE PURPOSE OF
FUNDING SUCH TAX PAYMENTS;
(D)
BORROWER MAY ISSUE AND SELL ITS COMMON EQUITY INTERESTS;
(E)
BORROWER MAY ISSUE PREFERRED EQUITY INTERESTS; PROVIDED, THAT SUCH
PREFERRED EQUITY MAY NOT (I) REQUIRE THE PAYMENT OF