Minimum Interest Coverage Clause Samples
The Minimum Interest Coverage clause sets a required threshold for the ratio of a borrower's earnings to its interest expenses, ensuring the borrower maintains sufficient income to cover interest payments on its debt. Typically, this is measured by comparing EBITDA or a similar earnings metric to interest obligations over a specified period, and the borrower must regularly demonstrate compliance with this ratio. The core function of this clause is to protect lenders by reducing the risk of default, ensuring the borrower remains financially stable enough to meet its debt service commitments.
Minimum Interest Coverage. The Borrower will not permit the ratio of EBITDA to Consolidated Interest Expense as at any fiscal quarter end for the four fiscal quarters then ending to be less than 3.00 to 1.0.
Minimum Interest Coverage. Commencing on October 1, 2013, the Borrower shall maintain a ratio of Consolidated EBITDA to Consolidated Net Interest Expense of not less than 2.00 to 1.00. Such ratio shall at all times be calculated on a trailing four quarter basis.”
Minimum Interest Coverage. Each of the Company and the Parent Guarantor will not at any time permit the ratio of Consolidated Income Available for Debt Service to the Annual Debt Service Charge for the period consisting of the four consecutive fiscal quarters then most recently ended to be less than 1.50 to 1.00.
Minimum Interest Coverage. The Company shall not permit the ratio of (i) EBITDA of the Company to (ii) Cash Interest Expense of the Company for any four (4) consecutive Fiscal Quarter periods to be less than 2.00:1.00.
Minimum Interest Coverage. From September 30, 2015 to December 31, 2016 the ratio of Consolidated EBITDA to Consolidated Net Interest Expense calculated on a quarterly basis shall be greater than 1.00 to 1.00; thereafter the ratio of Consolidated EBITDA to Consolidated Net Interest Expense calculated on a four quarter trailing basis shall be greater than (a) from January 1, 2017 to December 31, 2017, 2.00 to 1.00; and (b) at all other times thereafter, 2.50 to 1.00. Should after the Closing Date the US GAAP requirements materially change so as to impact the Financial Covenants, the Borrower and Lenders shall discuss the required amendments to the Financial Covenants so as to reflect the aforementioned changes. Collateral Maintenance: The aggregate Fair Market Value of all Collateral Vessels then acting as security for the Credit Facility shall at all times be at least 140% of the sum of the then aggregate outstanding principal amount of Loans (the “Collateral Maintenance Test”) provided that, any such non-compliance shall not constitute an event of default as long as within 30 days from the date the Administrative Agent has notified the Borrower in writing of the occurrence of such non compliance, the Borrower shall either (i) post additional collateral (“Additional Collateral”) reasonably satisfactory to all the Lenders in favor of the Security Trustee (it being understood that cash collateral comprised of U.S. Dollars is satisfactory and that it shall be valued at par), pursuant to security documentation reasonably satisfactory in form and substance to the Security Trustee, in an aggregate amount sufficient to cure such non-compliance (and shall at all times during such period and prior to satisfactory completion thereof, be diligently carrying out such actions) or (ii) reduce Loans in an amount sufficient to cure such non-compliance. The Borrower shall provide vessel valuations from two Approved Brokers on a semi-annual basis together with compliance certificate at its own expense. The Lenders may request an assessment of the Fair Market Value of the Collateral Vessels at any time; such assessment shall be at Borrower’s cost only if Additional Collateral is required to pass the Collateral Maintenance Test.
Minimum Interest Coverage. Not permit the Interest Coverage Ratio as of the last day of any Computation Period to be less than the applicable ratio set forth below: COMPUTATION INTEREST PERIOD ENDING: COVERAGE RATIO -------------- -------------- Closing Date through 12/31/00 1.49 to 1.0 1/01/01 through 12/31/01 1.70 to 1.0 1/01/02 and thereafter 1.91 to 1.0
Minimum Interest Coverage. The Borrower shall maintain a ratio of Consolidated EBITDA to Consolidated Net Interest Expense (excluding any commitment fees on the undrawn parts of the Total Commitments) equal to or greater than:
(a) from the date of this Agreement up to (and including) September 30, 2013, 2.00 to 1.00; and
(b) at all other times thereafter, 2.50 to 1.00. Such ratio shall be calculated quarterly on a trailing four quarter basis.
Minimum Interest Coverage. The Company shall not permit the Consolidated Interest Coverage Ratio as of the end of any fiscal quarter to be less than 3.5 to 1.0.
Minimum Interest Coverage. The Borrower will not permit its Consolidated Interest Coverage Ratio to be less than 3.00 to 1.00 at any time; provided that upon the consummation of a Material Acquisition that is a Permitted Acquisition, the Borrower will not permit such ratio to be less than 2.75 to 1.00 until the end of the last day of the third full fiscal quarter of the Borrower after the consummation of such Material Acquisition, at which time the lowest Consolidated Interest Coverage Ratio permitted to be maintained by the Borrower will automatically revert back to 3.00 to 1.00.
Minimum Interest Coverage. Borrower shall not permit, at any time, the ratio (the “Interest Coverage Ratio”) of (a) Home Building EBITDA to (b) Consolidated Home Building Interest Incurred, for any period consisting of the preceding four (4) consecutive fiscal quarters (each, a “Measurement Period”), to be less than 1.75 to 1.0. An example of the calculation of the Interest Coverage Ratio is as set forth in Schedule 8.20.