Secured Net Leverage Ratio Clause Samples
The Secured Net Leverage Ratio clause defines the maximum allowable ratio of a borrower's secured debt to its net earnings, typically measured by EBITDA. In practice, this clause requires the borrower to maintain a certain financial threshold, often tested quarterly, by comparing the total amount of secured debt (after subtracting cash or cash equivalents) to the company's earnings. This ensures that the borrower does not take on excessive secured debt relative to its ability to generate income, thereby protecting lenders by limiting financial risk and maintaining the borrower's creditworthiness.
Secured Net Leverage Ratio. (i) The Borrower will not permit the Secured Net Leverage Ratio as of the last day of any fiscal quarter (beginning with the end of the first full fiscal quarter after the Closing Date) to exceed the ratio set forth opposite such period below: Any Fiscal Quarter (i.e. March 31, June 30, September 30 and December 31) in the Four Fiscal Quarter Period Ending Maximum Secured Net Leverage Ratio December 31, 2016 4.50:1.00 December 31, 2017 4.00:1.00 December 31, 2018 3.50:1.00 December 31, 2019 and thereafter 3.00:1.00
(ii) The Borrower may, by written notice to the Administrative Agent for distribution to the Lenders, elect to increase the maximum Secured Net Leverage Ratio by 0.25x for a period of three (3) consecutive fiscal quarters in connection with a Permitted Acquisition that involves the payment of consideration by the Borrower and its Restricted Subsidiaries in excess of $150,000,000 occurring during the first of such three fiscal quarters (each such period, an “Adjusted Covenant Period”) and (ii) notwithstanding the foregoing clause (i), the Borrower may not elect an Adjusted Covenant Period for at least two (2) full fiscal quarters following the end of an Adjusted Covenant Period before a new Adjusted Covenant Period is available again pursuant to the preceding clause (i) for a new period of three (3) consecutive fiscal quarters.
Secured Net Leverage Ratio. On the last day of any Test Period on which the Revolving Facility Test Condition is then satisfied (it being understood and agreed that this Section 6.15(a) shall not apply earlier than the last day of the first Fiscal Quarter ending after the Restatement Effective Date (and on such date, only to the extent the Revolving Facility Test Condition is then satisfied)), the Borrower shall not permit the Secured Net Leverage Ratio to be greater than 3.00:1.00.
Secured Net Leverage Ratio. The Secured Net Leverage Ratio of Borrower, as of the end of each fiscal quarter (commencing with the fiscal quarter ending March 31, 2022) with respect to the four (4) fiscal quarters then ended, shall not be greater than 2.50 to 1.00.
Secured Net Leverage Ratio. Parent and its Restricted Subsidiaries, on a consolidated basis, will maintain, as of the end of each Fiscal Quarter, commencing with the Fiscal Quarter ending March 31, 2021, a Secured Net Leverage Ratio of not greater than 2.00:1.00 for each such Fiscal Quarter; provided that, upon the consummation of any Material Acquisition, such ratio shall be increased to 2.50:1.00 for the period beginning with the Fiscal Quarter in which such Material Acquisition was consummated and ending on (but including) the last day of the fourth full Fiscal Quarter after such Fiscal Quarter.
Secured Net Leverage Ratio. As of the last day of any fiscal quarter ending during the periods specified below, permit the Secured Net Leverage Ratio to be greater than the corresponding ratio set forth below: December 29, 2018 through December 26, 2020 3.75 to 1.00 December 27, 2020 and thereafter 3.00 to 1.00 ”
Secured Net Leverage Ratio. Commencing with the first full fiscal quarter ending after the Closing Date, permit the Secured Net Leverage Ratio at the end of any fiscal quarter on which the Revolving Facility Test Condition is then satisfied to be greater than 4.25:1.00.
Secured Net Leverage Ratio. (i) On or after the occurrence of a Qualifying Debt Issuance, during the Covenant Adjustment Period, US Borrower shall not suffer or permit the Secured Net Leverage Ratio as of the last day of the most recently completed fiscal quarter to exceed the ratio set forth below for such fiscal quarter, subject to the Optional Leverage Ratio Increase: Fiscal quarter ending September 30, 2024 5.15 to 1.00 Fiscal quarter ending December 31, 2024 5.00 to 1.00 Fiscal quarter ending March 31, 2025 4.75 to 1.00 Fiscal quarter ending June 30, 2025 4.50 to 1.00 Fiscal quarter ending September 30, 2025 4.25 to 1.00 Fiscal quarter ending December 31, 2025 4.00 to 1.00 Fiscal quarter ending March 31, 2026 and each fiscal quarter ending thereafter 3.50 to 1.00
(ii) On or after the occurrence of a Qualifying Debt Issuance, at any time after the Covenant Adjustment Period (including if the Covenant Adjustment Period is terminated pursuant 192068782_9 to clause (b) of the definition thereof prior to the date set forth in the grid in clause (i) above), US Borrower shall not suffer or permit the Secured Net Leverage Ratio as of the last day of the most recently completed fiscal quarter to exceed 3.50 to 1.00.
Secured Net Leverage Ratio. As of the last day of any fiscal quarter ending during the periods specified below, permit the Secured Net Leverage Ratio to be greater than the corresponding ratio set forth below: December 27, 2020 through January 1, 2022 3.00 to 1.00 January 2, 2022 through December 31, 2022 3.75 to 1.00 January 1, 2023 and thereafter 3.00 to 1.00 ; provided that, notwithstanding the foregoing, the maximum Secured Net Leverage Ratio set forth above shall be deemed to be 3.00 to 1.00 at all times for purposes of determining pro forma compliance with this Section 7.11(a) as required in connection with the utilization of the Available Amount Basket, the making of a Permitted Acquisition, the designation of an Unrestricted Subsidiary, the incurrence of Indebtedness pursuant to Section 7.02(q), the making of Investments pursuant to Section 7.03(k), the making of any Dispositions pursuant to Section 7.05(j), the making of any Restricted Payments pursuant to Section 7.06(d) or the making of any payment pursuant to Section 7.14(b) (each, a “Specified Pro Forma Financial Covenant Test”); provided, further, that solely for purposes of determining compliance with this Section 7.11(a) as of the last day of any fiscal quarter ending during the period from January 2, 2022 through December 31, 2022 (and not, for the avoidance of doubt, for purposes of determining compliance with any Specified Pro Forma Financial Covenant Test), the definition of Consolidated EBITDA shall be modified to (x) limit the aggregate amount added back pursuant to clause (vii) thereof to the greater of $30,000,000 and 10% of Consolidated EBITDA for such Measurement Period (calculated before giving effect to any such expenses to be added back pursuant to such clause (vii) for such Measurement Period), (y) limit the aggregate amount added back pursuant to clause (vii) thereof in respect of integration expenses related to the Polycom Acquisition to $30,000,000 and (z) limit the aggregate amount added back pursuant to clause (viii) thereof to the greater of $30,000,000 and 10% of Consolidated EBITDA for such Measurement Period (calculated before giving effect to any such items to be added back pursuant to such clause (viii) for such Measurement Period).”
Secured Net Leverage Ratio. After giving effect to the incurrence of the Term B-1 Loans anticipated hereby, the First Lien Net Leverage Ratio does not exceed 4.75:1.00, calculated on a Pro Forma Basis as of the last day of the most recently ended Test Period for which financial statements have been delivered pursuant to Section 5.01(b) or (c), as applicable, of the Credit Agreement, and, in each case, disregarding the Cash proceeds thereof for the purposes of determining the Unrestricted Cash Amount in connection with calculating the First Lien Net Leverage Ratio.
Secured Net Leverage Ratio. (1) On or after the occurrence of a Qualifying Debt Issuance, during the Covenant Adjustment Period, US Borrower shall not suffer or permit the Secured Net Leverage Ratio as of the last day of the most recently completed fiscal quarter to exceed 3.50 to 1.00the ratio set forth below for such fiscal quarter, subject to the Optional Leverage Ratio Increase.:
(2) On or after the occurrence of a Qualifying Debt Issuance, at any time after the Covenant Adjustment Period (including if the Covenant Adjustment Period is terminated pursuant to clause (b) of the definition thereof prior to the date set forth in the grid in clause (i) above), US Borrower shall not suffer or permit the Secured Net Leverage Ratio as of the last day of the most recently completed fiscal quarter to exceed 3.50 to 1.00.