(I)
SALES, ASSIGNMENTS OR TRANSFERS OF ASSETS TO THE EXTENT PERMITTED BY
SECTION 7.05 HEREOF;
(J)
LIENS ARISING SOLELY BY VIRTUE OF ANY STATUTORY OR COMMON LAW PROVISIONS
RELATING TO BANKER'S LIENS, LIENS IN FAVOR OF SECURITIES INTERMEDIARIES, RIGHTS
OF SETOFF OR SIMILAR RIGHTS AND REMEDIES AS TO DEPOSIT ACCOUNTS OR SECURITIES
ACCOUNTS OR OTHER FUNDS MAINTAINED WITH DEPOSITORY INSTITUTIONS OR SECURITIES
INTERMEDIARIES;
(K)
LIENS (IF ANY) ARISING FROM PRECAUTIONARY UCC, PPSA OR PRUCC OR COMPARABLE
FILINGS REGARDING "TRUE" OPERATING LEASES;
(L)
LIENS ON PROPERTY IN EXISTENCE AT THE TIME SUCH PROPERTY IS ACQUIRED BY A
LOAN PARTY OR ON PROPERTY OF A SUBSIDIARY OF A LOAN PARTY IN EXISTENCE AT THE
TIME SUCH SUBSIDIARY BECOMES A LOAN PARTY; PROVIDED THAT SUCH LIENS ARE NOT
INCURRED IN CONNECTION WITH, OR IN ANTICIPATION OF, SUCH ACQUISITIONS AND DO NOT
ATTACH TO ANY OTHER ASSETS OF ANY LOAN PARTY;
(M)
SO LONG AS THE INTERCREDITOR AGREEMENT IS IN EFFECT, LIENS SECURING
OBLIGATIONS IN RESPECT OF INDEBTEDNESS INCURRED PURSUANT TO SECTION 7.01A(M),
WHICH LIENS, AS TO COLLATERAL WITH RESPECT TO WHICH THE COLLATERAL AGENT FOR THE
SECURED PARTIES UNDER THE EXISTING REVOLVING CREDIT FACILITY HAS FIRST PRIORITY
PURSUANT TO THE INTERCREDITOR AGREEMENT, MAY BE SENIOR TO THE LIENS SECURING THE
OBLIGATIONS IN ACCORDANCE WITH THE TERMS OF THE INTERCREDITOR AGREEMENT;
50
(N)
LIENS (IF ANY) ARISING UNDER OR IN CONNECTION WITH THE LOAN PARTIES'
PRIVATE LABEL CREDIT CARD FACILITY, AS AMENDED OR REPLACED FROM TIME TO TIME, ON
INVENTORY CHARGED TO CREDIT CARDS AND RETURNED TO THE LOAN PARTIES FOR WHICH A
LOAN PARTY HAS NOT REIMBURSED THE CREDIT CARD FACILITY PROVIDER, INCLUDING ANY
LIENS ON THE PROCEEDS THEREOF; AND
(O)
OTHER LIENS ON ASSETS OF THE LOAN PARTIES (OTHER THAN INVENTORY OR ACCOUNTS
RECEIVABLE) TO THE EXTENT NOT OTHERWISE INCLUDED IN PARAGRAPHS (A) THROUGH
(M) OF THIS SECTION SECURING INDEBTEDNESS AND OTHER LIABILITIES IN AN AGGREGATE
AMOUNT NOT TO EXCEED $5,000,000 AT ANY TIME OUTSTANDING.
Notwithstanding anything to the contrary in this Agreement, the Borrower shall
not, and shall not permit any of its Subsidiaries to, create, incur, assume or
permit to exist any Lien securing Indebtedness (other than under the Loan
Documents and the ABL Credit Agreement) on any Equity Interests of (i) any Zale
Insurance Subsidiary or (ii) the ZC Partnership.
SECTION 7.03.
FUNDAMENTAL CHANGES.
(A)
THE BORROWER SHALL NOT, AND SHALL NOT
PERMIT ANY OF ITS SUBSIDIARIES TO, MERGE INTO, AMALGAMATE OR CONSOLIDATE WITH
ANY OTHER PERSON, OR PERMIT ANY OTHER PERSON TO MERGE INTO, AMALGAMATE OR
CONSOLIDATE WITH IT, OR LIQUIDATE OR DISSOLVE, EXCEPT THAT, IF AT THE TIME
THEREOF AND IMMEDIATELY AFTER GIVING EFFECT THERETO, NO DEFAULT OR EVENT OF
DEFAULT SHALL HAVE OCCURRED AND BE CONTINUING: (I) ANY SUBSIDIARY OF THE
BORROWER (OTHER THAN ANY ZALE INSURANCE SUBSIDIARY) MAY MERGE INTO OR AMALGAMATE
WITH ANY LOAN PARTY IN A TRANSACTION IN WHICH THE SURVIVING ENTITY IS A LOAN
PARTY, (II) ANY LOAN PARTY (OTHER THAN THE BORROWER) MAY EFFECT A MERGER,
DISSOLUTION, LIQUIDATION, CONSOLIDATION OR