Net Leverage Ratio Clause Samples
The Net Leverage Ratio clause defines a financial metric used to assess a borrower's indebtedness relative to its earnings, typically by comparing total debt minus cash or cash equivalents to EBITDA. In practice, this ratio is calculated periodically and may be used as a covenant in loan agreements, requiring the borrower to maintain the ratio below a specified threshold. The core function of this clause is to help lenders monitor and control the borrower's financial risk, ensuring the borrower does not become over-leveraged and thus protecting the lender's interests.
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Net Leverage Ratio. As of each Quarterly Testing Date, commencing with September 30, 2024, (i) before the first occurrence of an Investment Grade Event, the Net Leverage Ratio will not exceed 5.50 to 1.00 and (ii) from and after the first occurrence of an Investment Grade Event, the Net Leverage Ratio will not exceed 5.00 to 1.00; provided that, if a Specified Acquisition Period is in effect at any time from and after the first occurrence of an Investment Grade Event, the Net Leverage Ratio shall not exceed 5.50 to 1.00.
Net Leverage Ratio. The Borrowers will not permit the Net Leverage Ratio as of the end of any fiscal quarter during any period set forth below to exceed the ratio set forth opposite such period: Period Ratio ------ ----- March 30, 2001, to June 29, 2001 2.00 to 1.00 June 30, 2001 and June 29, 2002 1.75 to 1.00 June 30, 2002 and thereafter 1.50 to 1.00.
Net Leverage Ratio. Have a Net Leverage Ratio, measured on a quarter-end basis, of not greater than the applicable ratio set forth in the following table for the applicable date set forth opposite thereto:
Net Leverage Ratio. The Borrower shall not, as of the last day of any fiscal quarter, permit its Net Leverage Ratio to be greater than 3.00 to 1.00.
Net Leverage Ratio. Subject to the proviso set forth in Section 10.3, the Company will not permit the Consolidated Net Leverage Ratio at any time during any period of four consecutive fiscal quarters of the Company to be greater than (a) 3.50 to 1.00 or (b) during an Acquisition Holiday Period, 4.00 to 1.00.
1.6. Section 10.3(b) of the Original Note Purchase Agreement shall be and hereby is amended and restated in its entirety to read as follows:
Net Leverage Ratio. Beginning with the fiscal quarter ending December 31, 2020, the Company shall not permit the Net Leverage Ratio as of the last day of any fiscal quarter set forth below to be greater than the corresponding ratio set forth below: December 31, 2020 4.00 to 1.00 March 31, 2021 4.00 to 1.00 June 30, 2021 3.75 to 1.00 September 30, 2021 3.75 to 1.00 December 31, 2021 3.25 to 1.00 March 31, 2022 3.25 to 1.00 June 30, 2022 3.25 to 1.00 September 30, 2022 and thereafter 3.25 to 1.00
Net Leverage Ratio. The Borrower will not permit the Net Leverage Ratio at the end of any fiscal quarter to exceed 3.5 to 1.00; provided that if, at the end of any fiscal quarter, the Net Leverage Ratio is greater than 3.5 to 1.00 and the Borrower has entered into a permitted acquisition within the two most recently ended fiscal quarters (including such fiscal quarter) (a fiscal quarter in which all such conditions are satisfied, a “Trigger Quarter”), then the Net Leverage Ratio may be greater than 3.5 to 1.00 (but shall not exceed 4.00 to 1.00) for such Trigger Quarter and the next succeeding three fiscal quarters; provided that, following the occurrence of a Trigger Quarter, no subsequent Trigger Quarter shall be permitted or deemed to exist unless and until the Net Leverage Ratio has returned to less than or equal to 3.5 to 1.00 as of the end of at least one fiscal quarter following the occurrence of such initial Trigger Quarter; provided, further that, the Borrower shall cause the Net Leverage Ratio to be less than or equal to 3.5 to 1.00 by the end of a fiscal quarter no later than the fourth fiscal quarter after such initial Trigger Quarter.
Net Leverage Ratio. The Borrower will not permit the Net Leverage Ratio at the end of any of its fiscal quarters to exceed (w) 3.875 to 1.00 for its first fiscal quarter ending after the Funding Date through and including the last day of its second fiscal quarter in 2023, (x) 3.75 to 1.00 for its third and fourth fiscal quarters in 2023, (y) 3.5 to 1.00 for its first fiscal quarter in 2024 through and including its fourth fiscal quarter in 2024, and (z) 3.25 to 1.00 for its first fiscal quarter in 2025 and thereafter; provided that if, at the end of any fiscal quarter described in the preceding clauses (y) or (z), the Net Leverage Ratio is greater than 3.25 to 1.00 or 3.5 to 1.00, as applicable, and the Borrower has entered into a Material Acquisition within the two most recently ended fiscal quarters (including such fiscal quarter) (a fiscal quarter in which all such conditions are satisfied, a “Trigger Quarter”), then the Net Leverage Ratio may be greater than 3.25 to 1.00 or 3.5 to 1.00, as applicable (but shall not exceed 3.75 to 1.00) for such Trigger Quarter and the next succeeding three fiscal quarters (such four fiscal quarter period, an “Adjusted Covenant Period”); provided that, following the occurrence of a Trigger Quarter, no subsequent Trigger Quarter shall be permitted or deemed to exist unless and until the Net Leverage Ratio has returned to less than or equal to 3.25 to 1.00 or 3.5 to 1.00, as applicable, as of the end of at least one fiscal quarter following the occurrence of such initial Trigger Quarter; provided, further that, the Borrower shall cause the Net Leverage Ratio to be less than or equal to the level otherwise required by this Section 6.12(a) by the end of a fiscal quarter no later than the fourth fiscal quarter after such initial Trigger Quarter.
Net Leverage Ratio. Holdings shall not permit the Net Leverage Ratio as of the end of any Fiscal Quarter to be greater than 3.50 to 1.00; provided, that, for each of the four (4) Fiscal Quarters immediately following a Qualified Acquisition occurring during the first Fiscal Quarter of such four (4) Fiscal Quarters (such period of increase, the “Leverage Increase Period”), Holdings may elect to increase the ratio set forth above to 4.00 to 1.00; provided, further, that, (i) for at least two (2) Fiscal Quarters immediately following the end of a Leverage Increase Period, the Net Leverage Ratio as of the end of such Fiscal Quarters shall not be greater than 3.50 to 1.00 prior to Holdings electing another Leverage Increase Period pursuant to the immediately preceding proviso, (ii) there shall be no more than two (2) Leverage Increase Periods during the term of this Agreement, (iii) no more than one (1) Leverage Increase Period shall be in effect at any time, and (iv) the Leverage Increase Period shall only apply with respect to the calculation of the Net Leverage Ratio for purposes of determining compliance with the maintenance covenant set forth in this Section 9.8 as of the end of any Fiscal Quarter occurring during such Leverage Increase Period.
Net Leverage Ratio. The Borrower will not permit the Net Leverage Ratio to be greater than 3.5 to 1.0 as of the end of any fiscal quarter; provided that, if elected in writing by the Borrower to the Administrative Agent, for the twelve month period starting as of the date of any Material Acquisition, the Net Leverage Ratio shall not exceed 3.75:1.00 as of the last day of any fiscal quarter ending during such twelve month period; provided further that (i) in no event may the Borrower make such election more than twice during the term of this Agreement and (ii) the Borrower may not make the second such election until at least two full fiscal quarters after the end of the first such twelve month period elected by the Borrower.