eTrade 2005 Annual Report Download - page 466

(3) the net income of any Restricted Subsidiary to the extent that the declaration or payment of dividends or similar distributions by
such Restricted Subsidiary of such net income is not at the time permitted by the operation of the terms of its charter or any agreement,
instrument, judgment, decree, order, statute, rule or governmental regulation applicable to such Restricted Subsidiary;
(4) the net income of any Regulated Subsidiary (x)to the extent that the declaration or payment of dividends or similar distributions by
such Regulated Subsidiary of such net income is not at the time permitted by the operation of the terms of its charter or any agreement
or instrument with a Person, other than such Regulated Subsidiaries applicable regulatory authorities, or any judgment or decree
applicable to such Regulated Subsidiary (y)other than to the extent that such Regulated Subsidiary reasonably believes, in good faith,
that such net income could be distributed, declared or paid as a dividend or similar distribution without causing such Regulated
Subsidiary to fail to be at least “adequately capitalized” as defined in the regulations of applicable regulatory authorities, or to meet
minimum capital requirements imposed by applicable regulatory authorities;
(5) any gains or losses (on an after-tax basis) attributable to Asset Sales or Regulated Sales;
(6) solely for purposes of calculating the amount of Restricted Payments that may be made pursuant to clause (c)of Section4.04, any
amount paid or accrued as dividends on Preferred Stock of the Company owned by Persons other than the Company and any of its
Restricted Subsidiaries and Regulated Subsidiaries;
(7) all extraordinary gains and, solely for purposes of calculating the Consolidated Fixed Charge Coverage Ratio, extraordinary losses;
(8) the cumulative effect of changes in accounting principles; and
(9) the net after-tax effect of impairment charges related to goodwill and other intangible assets.
“
Affiliate
” means, as applied to any Person, any other Person directly or indirectly controlling, controlled by, or under direct or
indirect common control with, such Person. For purposes of this definition, “control” (including, with correlative meanings, the terms
“controlling,” “controlled by” and “under common control with”), as applied to any Person, means the possession, directly or
indirectly, of the power to direct or cause the direction of the management and policies of such Person, whether through the ownership
of voting securities, by contract or otherwise.
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