{"component": "clause", "props": {"groups": [{"samples": [{"hash": "3pW0Zj6l3NB", "uri": "/contracts/3pW0Zj6l3NB#maximum-total-leverage-ratio", "label": "Credit Agreement (Quad/Graphics, Inc.)", "score": 30.0841884613, "published": true}, {"hash": "lFz8mysWYy2", "uri": "/contracts/lFz8mysWYy2#maximum-total-leverage-ratio", "label": "Credit Agreement (Quad/Graphics, Inc.)", "score": 28.3347015381, "published": true}, {"hash": "1c5fLch8fqr", "uri": "/contracts/1c5fLch8fqr#maximum-total-leverage-ratio", "label": "Credit Agreement (Quad/Graphics, Inc.)", "score": 23.9746742249, "published": true}], "snippet_links": [{"key": "borrower-will", "type": "clause", "offset": [4, 17]}, {"key": "total-leverage-ratio", "type": "definition", "offset": [45, 65]}, {"key": "fiscal-quarters", "type": "definition", "offset": [109, 124]}, {"key": "consolidated-total-indebtedness", "type": "clause", "offset": [133, 164]}, {"key": "consolidated-ebitda", "type": "definition", "offset": [173, 192]}, {"key": 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"snippet": "The Borrower shall not permit the Total Leverage Ratio as of the last day of any four-quarter period to be greater than 4.00:1.00. Notwithstanding the foregoing:\n(a) for purposes of calculating the Total Leverage Ratio, until the earlier of (i) the consummation of a Specified Acquisition and (ii) termination of the acquisition agreement related to such Specified Acquisition, the Total Leverage Ratio shall not include any Indebtedness of the Borrower or the Guarantors to the extent that (x) such Indebtedness was incurred solely to finance such Specified Acquisition (and any related transactions) and the proceeds of such indebtedness are held as cash or cash equivalents in an escrow or equivalent arrangement (pending the consummation of such Specified Acquisition) and (y) such Indebtedness is redeemable or prepayable at no more than 101% of the principal amount thereof (plus accrued interest) in the event that the Specified Acquisition is not consummated; and\n(b) upon the Administrative Agent\u2019s receipt of a written notice substantially in the form of Exhibit F hereto (a \u201cSpecified Acquisition Notice\u201d), the Total Leverage Ratio as of the last day of any period for the four-quarter period beginning with the period in which such Specified Acquisition is consummated (such period in which the Specified Acquisition is consummated, the \u201cSpecified Acquisition Consummation Period\u201d) and continuing through the fourth consecutive fiscal quarter ended immediately following the first day of the Specified Acquisition Consummation Period shall not exceed 4.50:1.00 (in lieu of the ratio set forth for such period above); provided that (i) the Borrower may deliver a Specified Acquisition Notice no more than three times during the life of this Agreement and (ii) after any Specified Acquisition Consummation Period, the Borrower must have a Total Leverage Ratio of no more than 4.00:1.00 for at least two consecutive fiscal quarters before the Borrower may elect to deliver a Specified Acquisition Notice for an additional time.", "size": 22, "hash": 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"score": 19.0, "published": true}], "snippet_links": [{"key": "total-leverage-ratio", "type": "definition", "offset": [11, 31]}, {"key": "at-the-end-of", "type": "clause", "offset": [36, 49]}, {"key": "test-period-ending", "type": "definition", "offset": [54, 72]}, {"key": "closing-date", "type": "definition", "offset": [219, 231]}, {"key": "october-1", "type": "definition", "offset": [271, 280]}, {"key": "through-december", "type": "clause", "offset": [389, 405]}], "snippet": "Permit the Total Leverage Ratio, as at the end of any Test Period ending during any period set forth in the table below, to exceed the ratio set forth opposite such period in the table below: Test Period Leverage Ratio Closing Date through September 30, 2007 6.50 to 1.0 October 1, 2007 through June 30, 2008 6.25 to 1.0 July 1, 2008 through September 30, 2008 6.00 to 1.0 October 1, 2008 through December 31, 2008 5.50 to 1.0 January 1, 2009 through December 31, 2009 4.00 to 1.0 January 1, 2010 through December 31, 2010 3.25 to 1.0 January 1, 2011 through December 31, 2011 2.25 to 1.0 January 1, 2012 and thereafter 2.00 to 1.0", "size": 14, "hash": "c3cc6e098ec82fc5724d58c424998d8c", "id": 5}, {"samples": [{"hash": "lpjHLst53W3", "uri": "/contracts/lpjHLst53W3#maximum-total-leverage-ratio", "label": "First Lien Credit Agreement (STR Holdings LLC)", "score": 21.0, "published": true}, {"hash": "fLx0ZZkQNQR", "uri": "/contracts/fLx0ZZkQNQR#maximum-total-leverage-ratio", "label": "First Lien Credit Agreement (STR Holdings LLC)", "score": 21.0, "published": true}, {"hash": "evTFvYDYiBx", "uri": "/contracts/evTFvYDYiBx#maximum-total-leverage-ratio", "label": "First Lien Credit Agreement (STR Holdings (New) LLC)", "score": 21.0, "published": true}], "snippet_links": [{"key": "total-leverage-ratio", "type": "definition", "offset": [11, 31]}, {"key": "at-any-time", "type": "clause", "offset": [32, 43]}], "snippet": "Permit the Total Leverage Ratio at any time during a period set forth below to be greater than the ratio set forth opposite such period below: September 30, 2007 7.75 to 1.00 December 31, 2007 7.75 to 1.00 March 31, 2008 7.75 to 1.00 June 30, 2008 7.75 to 1.00 September 30, 2008 7.50 to 1.00 December 31, 2008 7.00 to 1.00 March 31, 2009 6.25 to 1.00 June 30, 2009 6.25 to 1.00 September 30, 2009 6.25 to 1.00 December 31, 2009 6.25 to 1.00 March 31, 2010 6.00 to 1.00 June 30, 2010 6.00 to 1.00 September 30, 2010 6.00 to 1.00 December 31, 2010 6.00 to 1.00 March 31, 2011 5.00 to 1.00 June 30, 2011 5.00 to 1.00 September 30, 2011 5.00 to 1.00 December 31, 2011 5.00 to 1.00 March 31, 2012 5.00 to 1.00", "size": 12, "hash": "a51b58ab245f514b414495d1ef8ff036", "id": 7}, {"samples": [{"hash": "kYLd2Nd7Q2c", "uri": "/contracts/kYLd2Nd7Q2c#maximum-total-leverage-ratio", "label": "Credit Agreement (Mattress Firm Holding Corp.)", "score": 22.64818573, "published": true}, {"hash": "j5opuwJRuZb", "uri": "/contracts/j5opuwJRuZb#maximum-total-leverage-ratio", "label": "Credit Agreement 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to 1.0 April 30, 2012 3.50 to 1.0 July 31, 2012 3.50 to 1.0 October 31, 2012 3.50 to 1.0 January 31, 2013 3.50 to 1.0 April 30, 2013 3.50 to 1.0 Thereafter 3.50 to 1.0", "size": 12, "hash": "4ce11450de25bb414149e35cbb905b9f", "id": 8}, {"samples": [{"hash": "gVUGdb2zniZ", "uri": "/contracts/gVUGdb2zniZ#maximum-total-leverage-ratio", "label": "Credit Agreement (Intercontinentalexchange Inc)", "score": 21.0, "published": true}, {"hash": "eFsT1ID4fuG", "uri": "/contracts/eFsT1ID4fuG#maximum-total-leverage-ratio", "label": "Credit Agreement (Intercontinentalexchange Inc)", "score": 21.0, "published": true}, {"hash": "aciVDugetIg", "uri": "/contracts/aciVDugetIg#maximum-total-leverage-ratio", "label": "Credit Agreement (Intercontinentalexchange Inc)", "score": 21.0, "published": true}], "snippet_links": [{"key": "total-leverage-ratio", "type": "definition", "offset": [4, 24]}, {"key": "day-of", "type": "clause", "offset": [40, 46]}, {"key": "beginning-with-the", "type": "clause", "offset": [67, 85]}, {"key": "first-fiscal-quarter", "type": "definition", "offset": [86, 106]}, {"key": "ratio-of", "type": "clause", "offset": [146, 154]}], "snippet": "The Total Leverage Ratio as of the last day of any fiscal quarter, beginning with the first fiscal quarter of 2009, shall not be greater than the ratio of 2.50 to 1.00.", "size": 11, "hash": "5c8172ee6808ceffc00dc37675e9cf07", "id": 9}, {"samples": [{"hash": "8ilg5nDoWbM", "uri": "/contracts/8ilg5nDoWbM#maximum-total-leverage-ratio", "label": "Credit Agreement (Lazydays Holdings, Inc.)", "score": 29.2162895203, "published": true}], "snippet_links": [{"key": "the-borrowers", "type": "definition", "offset": [0, 13]}, {"key": "total-leverage-ratio", "type": "definition", "offset": [35, 55]}, {"key": "ratio-of", "type": "clause", "offset": [68, 76]}, {"key": "day-of", "type": "clause", "offset": [115, 121]}, {"key": "beginning-with-the", "type": "clause", "offset": [143, 161]}, {"key": "fiscal-quarter-ending", "type": "clause", "offset": [162, 183]}], "snippet": "The Borrowers shall not permit the Total Leverage Ratio to exceed a ratio of 3.00 to 1.00, as measured on the last day of each Fiscal Quarter, beginning with the Fiscal Quarter ending June 30, 2018.", "size": 9, "hash": "62f0522667ee8ff32e34e705008c6bab", "id": 10}], "next_curs": "CmUSX2oVc35sYXdpbnNpZGVyY29udHJhY3RzckELEhZDbGF1c2VTbmlwcGV0R3JvdXBfdjU2IiVtYXhpbXVtLXRvdGFsLWxldmVyYWdlLXJhdGlvIzAwMDAwMDBhDKIBAmVuGAAgAA==", "clause": {"parents": [["financial-covenants", "Financial Covenants"], ["negative-covenants", "Negative Covenants"], ["covenants", "Covenants"], ["miscellaneous", "Miscellaneous"], ["amendments-to-credit-agreement", "Amendments to Credit Agreement"]], "children": [["", ""], ["events-of-default", "Events of Default"], ["merger-consolidation", "Merger; Consolidation"], ["notices", "Notices"], ["right-of-setoff", "Right of Setoff"]], "title": "Maximum Total Leverage Ratio", "size": 710, "id": "maximum-total-leverage-ratio", "related": [["total-leverage-ratio", "Total Leverage Ratio", "Total Leverage Ratio"], ["maximum-leverage-ratio", "Maximum Leverage Ratio", "Maximum Leverage Ratio"], ["total-net-leverage-ratio", "Total Net Leverage Ratio", "Total Net Leverage Ratio"], ["consolidated-total-leverage-ratio", "Consolidated Total Leverage Ratio", "Consolidated Total Leverage Ratio"], ["maximum-secured-leverage-ratio", "Maximum Secured Leverage Ratio", "Maximum Secured Leverage Ratio"]], "related_snippets": [], "updated": "2026-05-10T05:39:37+00:00", "also_ask": ["What negotiation leverage exists in setting the ratio threshold?", "Which carve-outs or adjustments are essential in drafting this ratio?", "What are the most common pitfalls that render this clause unenforceable?", "How does this ratio compare to market standards in similar financings?", "How have courts interpreted breaches of leverage ratio covenants in recent cases?"], "drafting_tip": "Specify the calculation method and components of the leverage ratio to prevent misinterpretation; set clear measurement dates to ensure consistent compliance assessment; define consequences of breach to reinforce enforceability.", "explanation": "The Maximum Total Leverage Ratio clause sets a limit on the amount of debt a borrower can have relative to a financial metric, typically EBITDA or total assets. In practice, this clause requires the borrower to maintain their total outstanding debt below a specified multiple of their earnings or assets, which is periodically tested through financial reporting. Its core function is to control the borrower's leverage, thereby reducing the lender's risk by ensuring the borrower does not become over-leveraged and remains financially stable."}, "json": true, "cursor": ""}}