Leverage Ratios Clause Samples
The Leverage Ratios clause defines the specific financial metrics used to measure a party's level of debt relative to its equity or assets. Typically, this clause outlines how leverage ratios are calculated, what thresholds must be maintained, and the reporting requirements for demonstrating compliance. For example, it may require a borrower to keep its total debt below a certain multiple of its EBITDA or net worth. The core function of this clause is to manage financial risk by ensuring that a party does not become over-leveraged, thereby protecting lenders or counterparties from increased credit risk.
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Leverage Ratios. Notwithstanding anything to the contrary contained herein, for purposes of calculating any leverage ratio herein in connection with the incurrence of any Indebtedness, (a) there shall be no netting of the cash proceeds proposed to be received in connection with the incurrence of such Indebtedness and (b) to the extent the Indebtedness to be incurred is revolving Indebtedness, such incurred revolving Indebtedness (or if applicable, the portion (and only such portion) of the increased commitments thereunder) shall be treated as fully drawn.
Leverage Ratios. (a) If no Unsecured Note Indebtedness is outstanding on the applicable date of determination, permit the Consolidated Leverage Ratio to be greater than: (i) 5.75 to 1.0 on the Closing Date nor on the last day of the fiscal quarters ending March 31, 2007 and June 30, 2007; and (ii) 5.00 to 1.0 on the last day of any fiscal quarter ending on or after September 30, 2007.
(b) If any Unsecured Note Indebtedness is incurred or outstanding on the applicable date of determination, permit the Consolidated Leverage Ratio to be greater than: (i) during the period prior to September 30, 2007, 6.25 to 1.0 on the date any Unsecured Note Indebtedness is incurred nor on the last day of any fiscal quarter ending during such period; and (ii) during the period on or after September 30, 2007, 5.50 to 1.0 on the date any Unsecured Note Indebtedness is incurred nor on the last day of any fiscal quarter ending during such period.
(c) If any Unsecured Note Indebtedness is incurred or outstanding on the applicable date of determination, permit the Consolidated Senior Leverage Ratio to be greater than: (i) during the period prior to September 30, 2007, 5.25 to 1.0 on the date any Unsecured Note Indebtedness is incurred nor on the last day of any fiscal quarter ending during such period; nor (ii) during the period on or after September 30, 2007, 4.50 to 1.0 on the date any Unsecured Note Indebtedness is incurred nor on the last day of any fiscal quarter ending during such period.
(d) During an Acquisition Period, the maximum permitted Consolidated Leverage Ratio and the maximum permitted Consolidated Senior Leverage Ratio shall each be increased by 0.50 to 1.00 from the otherwise applicable ratio set forth above (for example, the Consolidated Leverage Ratio requirement that would otherwise be 5.50 to 1.00 will become 6.00 to 1.00). As used in this Section 7.15(d), “Acquisition Period” means a period elected by the Borrower, such election to be exercised by the Borrower by delivering notice thereof to the Administrative Agent, beginning with the funding date of the purchase price for any Specified Acquisition and ending on the earlier of (a) the first anniversary date of such funding date or (b) the Borrower’s election (provided, that the Borrower is in compliance with all applicable provisions of this Section 7.15 after giving effect to such election), to terminate such Acquisition Period, such election to be exercised by the Borrower delivering notice thereof to the Administrative ...
Leverage Ratios. (i) The Leverage Ratio shall at all times be less than 60%.
(ii) The Unencumbered Leverage Ratio shall at all times be less than 60%.
(iii) The Secured Leverage Ratio shall at all times be less than 45%.
Leverage Ratios. The Borrower shall not permit (i) the ratio of (a) the aggregate principal amount of Funded Senior Debt outstanding at any time of the Borrower and its Subsidiaries to (b) EBITDA for the Test Period then most recently ended to exceed (A) 2.75:1.00 at any time on or prior to the last day of the fiscal year ending on or about December 31, 1999 and (B) 1.50:1.00 at any time thereafter; or (ii) the ratio of (a) the aggregate principal amount of Funded Debt outstanding at any time of the Borrower and its Subsidiaries to (b) EBITDA for the Test Period then most recently ended to exceed (A) 3.50:1.00 at any time on or prior to the last day of the fiscal year ending on or about December 31, 1999 and (B) 2.50:1.00 at any time thereafter.
Leverage Ratios. (i) The Credit Parties will not permit at any time the Senior Leverage Ratio to be greater than 0.60 to 1:00.
(ii) The Credit Parties will not permit at any time the Total Leverage Ratio to be greater than 0.65 to 1:00.
Leverage Ratios. The Senior Leverage Ratio shall not be greater than 3.6:1.0 and the Total Leverage Ratio shall not be greater than 5.3:1.0, in each case (i) after giving pro forma effect to the incurrence of the Initial Term Loans and the Senior Subordinated Notes and (ii) based off pro forma Consolidated Adjusted EBITDA of Holdings and its Subsidiaries for the twelve month period ended at least 30 days prior to the Closing Date, giving effect to the Phase 1 Acquisitions. Each Lender, by delivering its signature page to this Agreement and funding a Loan on the Closing Date, shall be deemed to have acknowledged receipt of, and consented to and approved, each Loan Document and each other document required to be approved by any Agent, Requisite Lenders or Lenders, as applicable on the Closing Date.
Leverage Ratios. (a) Holdings will not permit the Secured Leverage Ratio at the end of any Test Period ending on March 31, June 30, September 30 and December 31 of any calendar year to be more than 3.50 to 1.00; provided that the Secured Leverage Ratio may be increased up to (but not to exceed) 4.00:1.00 for any Fiscal Quarter ending after the Closing Date during which the Holdings or any of its Subsidiaries has consummated an acquisition or other Investment permitted hereunder in which the is $50,000,000 or more (a “Trigger Quarter”) and for the next succeeding three (3) Fiscal Quarters; provided, further, that the Secured Leverage Ratio shall return to 3.50:1.00 no later than the end of the fourth (4th) Fiscal Quarter after such Trigger Quarter; provided, further, that following the occurrence of a Trigger Quarter (any such Trigger Quarter, an “Initial Trigger Quarter”), no subsequent Trigger Quarter shall be permitted to occur for purposes of this Section 9.13(a) unless and until the Secured Leverage Ratio is less than or equal to 3.50:1.00 as of the end of at least three (3) Fiscal Quarters following such Initial Trigger Quarter. For the purposes of calculating the financial covenant set forth in this clause (a), the Relief Fund shall be deemed not to be a ‘Subsidiary.’
(b) Holdings will not permit the Total Leverage Ratio at the end of any Test Period ending on March 31, June 30, September 30 and December 31 of any calendar year to be more than 4.25 to 1.00; provided that the Total Leverage Ratio may be increased up to (but not to exceed) 4.75:1.00 for any Trigger Quarter and for the next succeeding three (3) Fiscal Quarters; provided, further, that the Total Leverage Ratio shall return to 4.25:1.00 no later than the end of the fourth (4th) Fiscal Quarter after such Trigger Quarter; provided, further, that following the Initial Trigger Quarter, no subsequent Trigger Quarter shall be permitted to occur for purposes of this Section 9.13(b) unless and until the Total Leverage Ratio is less than or equal to 4.25:1.00 as of the end of at least three (3) Fiscal Quarters following such Initial Trigger Quarter.. For the purposes of calculating the financial covenant set forth in this clause (b), the Relief Fund shall be deemed not to be a ‘Subsidiary.’
Leverage Ratios. Consolidated Leverage Ratio
A. Consolidated Funded Indebtedness on such determination date: $
B. Consolidated Adjusted EBITDA for the applicable period of four consecutive fiscal quarters (Schedule 2): $
C. Consolidated Leverage Ratio (Line II.A ÷ Line II.B): to 1.0 Maximum permitted: Prior to the Collateral Release Date, on each Quarterly Testing Date occurring on or after June 30, 2018 5.50 to 1.00 From and after the Collateral Release Date, on each Quarterly Testing Date occurring on or after June 30, 2018, other than during a Specified Acquisition Period 5.25 to 1.00 From and after the Collateral Release Date, on each Quarterly Testing Date occurring on or after June 30, 2018, occurring during a Specified Acquisition Period 5.50 to 1.00 For the Quarter/Year ended (“Statement Date”) – All non-cash items of income (other than account receivables and similar items arising from the normal course of business and reflected as income under accrual methods of accounting consistent with past practices) for such period — — — — — + Pro rata share of Included Unrestricted Subsidiaries EBITDA — — — — — – Unrestricted Subsidiaries (other than Included Unrestricted Subsidiaries) EBITDA (100%) — — — — — – Income from Equity Interests — — — — — = Consolidated EBITDA before Cash Distributions — — — — — – Actual cash distributions to the Borrower and its Consolidated Restricted Subsidiaries from Unrestricted Subsidiaries (other than Included Unrestricted Subsidiaries) or in respect of Equity Interests of other Persons (that are not Subsidiaries) in excess of 20% of total Consolidated EBITDA before actual cash distributions — — — — — = Consolidated EBITDA — — — — — + Pro forma gain (loss) resulting from any Material Acquisition or Disposition or Subsidiary redesignation — — — — — 3 Aggregate amount of all Material Project EBITDA Adjustments limited to 20% of total actual Consolidated EBITDA for a period.
Leverage Ratios. (i) The Borrower and its Subsidiaries on a consolidated basis shall not permit the ratio (the "Total Leverage Ratio") of (i) Total Debt to (ii) EBITDA to be greater than the ratio set forth below at the end of the fiscal quarter ending on the corresponding date set forth below: Quarter Ending Total Leverage -------------- -------------- Ratio ----- December 31, 2001 6.50 to 1.00 March 31, 2002 6.50 to 1.00 June 30, 2002 5.50 to 1.00 September 30, 2002 5.00 to 1.00 December 31, 2002 4.00 to 1.00 March 31, 2003 3.25 to 1.00 June 30, 2003 2.75 to 1.00 September 30, 2003 and each 2.50 to 1.00 quarter thereafter
(ii) The Borrower and its Subsidiaries on a consolidated basis shall not permit the ratio (the "Senior Leverage Ratio") of (i) Senior Debt to (ii) EBITDA to be greater than the ratio set forth below at the end of the fiscal quarter or date ending on the corresponding date set forth below: Quarter or Date Ending Senior Leverage Ratio ---------------------- --------------------- December 31, 2001 6.50 to 1.00 April 15, 2002 4.00 to 1.00 June 30, 2002 3.75 to 1.00 September 30, 2002 3.25 to 1.00 December 31, 2002 2.50 to 1.00 March 31, 2003 2.00 to 1.00 June 30, 2003 and each quarter 1.50 to 1.00 thereafter In each case, the Leverage Ratio shall be determined as of the last day of each fiscal quarter based upon (i) Total Debt as of the last day of such fiscal quarter and (ii) EBITDA for the four fiscal quarter period ending on such day.
Leverage Ratios. (a) The Leverage Ratio, as of any date, to exceed 1.0 to 1.0.
(b) The Adjusted Leverage Ratio, as of any date, to exceed 1.0 to 1.0.