Interest Coverage Covenant Sample Clauses
An Interest Coverage Covenant is a contractual provision that requires a borrower to maintain a minimum ratio of earnings to interest expenses. Typically, this ratio is calculated by dividing earnings before interest and taxes (EBIT) by the interest payments due over a specified period, ensuring the borrower generates sufficient income to cover its debt obligations. This clause serves to protect lenders by reducing the risk of default, as it provides an early warning mechanism if the borrower's financial health deteriorates.
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Interest Coverage Covenant. The Borrower shall not permit the Interest Coverage Ratio, determined as of the last day of each fiscal quarter of the Borrower, to be less than 1.50 to 1.00.
Interest Coverage Covenant. At all times during the term of the Loan, the Borrower’s minimum interest coverage ratio shall exceed 1.4x for each calendar quarter. For the purposes of this Agreement, interest coverage ratio shall be equal to EBITDA for a calendar quarter divided by Interest Expense for the same calendar quarter. As used herein, EBITDA shall mean net income plus Interest Expense, depreciation, amortization, and expensed acquisition costs, all as reflected in the Borrower’s 10Q or 10K, as applicable, filed with the Securities and Exchange Commission. As used herein, “Interest Expense” shall mean Borrower’s interest expense as reported in the Borrower’s 10Q or 10K, as applicable, filed with the Securities and Exchange Commission.
Interest Coverage Covenant. The Borrower shall not permit the ratio of (x) the Borrower and the Subsidiaries' Consolidated Adjusted EBITDA to (y) Consolidated Interest Expense, measured on a rolling four Fiscal Quarters basis, to fall below 1.50 to 1.00 as of the end of any Fiscal Quarter."
G. Amendment of Section 8.8 (Senior Notes). Section 8.8 is hereby amended and restated as follows:
Interest Coverage Covenant. The ratio (the “Interest Coverage Ratio”) of Consolidated EBITDA (as defined in the Master Credit Facility) to consolidated interest expense (excluding Timberland Installment Sale Interest Expense (as defined in the Master Credit Facility)) of the Glatfelter group, measured as of the end of each fiscal quarter, shall for the four (4) fiscal quarters then ended, not be less than 3.50 to 1.0; Whereby Master Credit Facility is the USD 350,000,000.00 Revolving Credit Facility by and among, inter alia, P.H. Glatfelter Company and certain of its subsidiaries as borrowers, and PNC Bank, National Association as Administrative Agent, dated as of November 21, 2011, as amended from time to time between the parties thereto; this explicitly includes any amendment, extension, supplement, renewal, total or partial novation, transfer to or redemption by third party lenders as well as any direct or indirect extensions of the loan commitment hereunder, and any new or continued, similarly structured revolving facility. The Borrower shall inform the Bank about changes to the Master Credit Facility in due course. Should the Master Credit Facility pursuant to the above definition no longer exist, the respective last version of the Master Credit Facility shall be decisive for purposes of the financial covenants and their interpretation under this loan contract.