Whenever Pro Forma Effect Clause Samples
The 'Whenever Pro Forma Effect' clause defines how certain financial calculations or covenants are to be assessed on a pro forma basis, meaning as if a specific event or transaction had already occurred. In practice, this clause typically applies when evaluating compliance with financial ratios or thresholds after mergers, acquisitions, asset sales, or other significant transactions, requiring the parties to recalculate financial metrics as though the event had taken place at an earlier date. Its core function is to ensure that financial assessments reflect the true impact of major transactions, thereby providing a more accurate and forward-looking measure of financial condition or covenant compliance.
Whenever Pro Forma Effect is to be given to a transaction, the pro forma calculations shall be made in good faith by a responsible financial or accounting officer of the Borrower (and may include, without duplication, cost savings, and operating expense reductions resulting from such Investment, acquisition, merger, or consolidation which is being given Pro Forma Effect that have been or are expected to be realized; provided that such costs savings and operating expense reductions are made in compliance with the definition of Pro Forma Adjustment). If any Indebtedness bears a floating rate of interest and is being given Pro Forma Effect, the interest on such Indebtedness shall be calculated as if the rate in effect on the date of determination had been the applicable rate for the entire period (taking into account for such entire period, any Hedging Obligation applicable to such Indebtedness with a remaining term of 12 months or longer, and in the case of any Hedging Obligation applicable to such Indebtedness with a remaining term of less than 12 months, taking into account such Hedging Obligation to the extent of its remaining term). Interest on a Capitalized Lease Obligation shall be deemed to accrue at an interest rate reasonably determined by a responsible financial or accounting officer of the Borrower to be the rate of interest implicit in such Capitalized Lease Obligation in accordance with GAAP. For purposes of making the computation referred to above, interest on any Indebtedness under a revolving credit facility computed on a Pro Forma Basis shall be computed based upon the average daily balance of such Indebtedness during the applicable period (or, if lower, the greater of (i) maximum commitments under such revolving credit facilities as of the date of determination and (ii) the aggregate principal amount of loans outstanding under such a revolving credit facilities on such date). Interest on Indebtedness that may optionally be determined at an interest rate based upon a factor of a prime or similar rate, a eurocurrency interbank offered rate, or other rate, shall be deemed to have been based upon the rate actually chosen, or, if none, then based upon such optional rate chosen as the Borrower may designate. In connection with the incurrence of any Indebtedness under Section 2.14, the definitions of Required Lenders, Required Revolving Credit Lenders and Required Term Loan Lenders shall be calculated on a Pro Forma Basis in accordance with this Section 1.12, Section 2.14 ...
Whenever Pro Forma Effect is to be given to a transaction or any financial metric or test is to be calculated on a Pro Forma Basis, the pro forma calculations shall be made in good faith by a responsible financial or accounting officer of the Parent Borrower (and may include, for the avoidance of doubt and without duplication, cost savings, and operating expense reductions resulting from the Investment, acquisition, merger, or consolidation which is being given Pro Forma Effect that have been or are expected to be realized; provided that such cost savings and operating expense reductions are made in compliance with the definition of Consolidated EBITDA).
Whenever Pro Forma Effect or a determination of Pro Forma Compliance is to be given to a Specified Transaction, the calculations shall be made in good faith by a Responsible Officer of the Borrower and may include, for the avoidance of doubt, the amount of Run Rate Benefits related to Run Rate Initiatives projected by the Borrower in good faith to result from or relating to any Specified Transaction (including the Transactions) that is being given Pro Forma Effect or for which a determination of Pro Forma Compliance is being made that have been realized or are expected to be realized and for which the actions necessary to realize such Run Rate Benefits have been taken or initiated, have been committed to be taken or initiated, with respect to which substantial steps have been taken or initiated or which are expected to be taken or initiated (in the good-faith determination of the Borrower) (calculated on a Pro Forma Basis as though such Run Rate Benefits had been realized on the first day of such period and as if such Run Rate Benefits were realized during the entirety of such period and “run rate” means the full recurring benefit for a period that is associated with any action taken or initiated, any action committed to be taken or initiated, any action with respect to which substantial steps have been taken or initiated or any action that is expected to be taken or initiated (including any savings expected to result from the elimination of Public Company Costs, if any) net of the amount of actual benefits realized during such period from such actions, and any such Run Rate Benefits shall be included in the initial pro forma calculations of such financial ratios or tests and during any subsequent Test Period in which the effects thereof are expected to be realized) relating to such Specified Transaction or Specified Transaction, and any such Run Rate Benefits included in the initial pro forma calculations shall continue to apply to subsequent calculations of such financial ratios or tests, including during any subsequent Test Periods in which the effects thereof are expected to be realizable; provided that (A) such Run Rate Benefits are reasonably identifiable in the good-faith judgment of the Borrower, (B) such actions are taken or initiated, such actions are committed to be taken or initiated, substantial steps with respect to such action have been taken or initiated or such actions are expected to be taken or initiated no later than twelve fiscal quarters after the date of cons...
Whenever Pro Forma Effect is to be given to a transaction, the pro forma calculations shall be made in good faith by a responsible financial or accounting officer of a Borrower (and may include, for the avoidance of doubt and without duplication, cost savings, and operating expense reductions resulting from such Investment, acquisition, merger, or consolidation which is being given Pro Forma Effect that have been or are expected to be realized; provided that such costs savings and operating expense reductions are made in compliance with the definition of Pro Forma Adjustment). If any Indebtedness bears a floating rate of interest and is being given Pro Forma Effect, the interest on such Indebtedness shall be calculated as if the rate in effect on the date of determination had been the applicable rate for the entire period (taking into account for such entire period, any Hedging Obligation applicable to such Indebtedness with a remaining term of 12 months or longer, and in the case of any Hedging Obligation applicable to such Indebtedness with a remaining term of less than 12 months, taking into account such Hedging Obligation to the extent of its remaining term).
Whenever Pro Forma Effect is to be given to a transaction or any financial metric or test is to be calculated on a Pro Forma Basis, the pro forma calculations shall be made in good faith by a responsible financial or accounting officer of the Parent Borrower (and may include, for the avoidance of #101458425v1 doubt and without duplication, cost savings, and operating expense reductions resulting from the Investment, acquisition, merger, or consolidation which is being given Pro Forma Effect that have been or are expected to be realized; provided that such cost savings and operating expense reductions are made in compliance with the definition of Consolidated EBITDA).