Debt Ratios. Debt ratios measure the total amount and proportion of debt within the liabilities section of a firm's balance sheet. These figures are normally appropriate for comparing a company performance from one period to another. The debt position of a firm indicates the amount of other people's money being used in attempting to generate profits. The ability to repay long term debt is of most concern. The more debt a firm uses in relation to it's total assets, the greater is it's financial leverage. Ie: Fixed-cost debt up = financial leverage up = shareholder risk up. Borrowing money to finance your firm's debt will give you a higher return on investment, but also more risk as there are interest and capital repayment obligations to be met first. • Debt Ratio • Debt to Equity Ratio • Times Interest Earned • Fixed Payment Coverage Ratio
Debt Ratios. The Agent shall have received a certificate of a senior financial officer of the Borrower setting forth, as of the Closing Date, after giving effect to the Acquisition, the funding of all Loans to be made hereunder on the Closing Date, the issuance of the Subordinated Notes and the consummation of all other transactions contemplated hereby to occur on the Closing Date, (i) the actual Maximum Total Debt Ratio (which shall not exceed 7:00:1) and (ii) the actual Maximum Senior Debt Ratio (which shall not exceed 4:00:1).
Debt Ratios. III. Debt Ratios Debt ratios measure the total amount and proportion of debt within the liabilities section of a firm's balance sheet. These figures are normally appropriate for comparing a company performance from one period to another. The debt position of a firm indicates the amount of other people's money being used in attempting to generate profits. The ability to repay long term debt is of most concern. The more debt a firm uses in relation to it's total assets, the greater is it's financial leverage. Ie: Fixed-cost debt up = financial leverage up = shareholder risk up. Borrowing money to finance your firm's debt will give you a higher return on investment, but also more risk as there are interest and capital repayment obligations to be met first. Debt Ratio Measure the proportion of total assets provided by a company's creditors. The debt ratio is calculated by dividing the total liabilities by total assets. The higher this ratio, the greater the degree of outside financing by creditors. It indicates that the firm is more highly leveraged (debt) and highly risky for creditors. The basic formula is as follows: Debt Ratio = Total Liabilities / Total Assets Higher ratios indicate high financial leverage to the firm. Some people ignore short term obligations (e.g. current liabilities) in calculating debt ratios.
Debt Ratios. (a) The amount of Secured Debt shall not exceed 50% of the Gross Asset Value during the 24 calendar month period immediately following the Closing Date and thereafter, the amount of Secured Debt shall not exceed 45% of the Gross Asset Value; (b) the Outstanding Amount of all Loans plus the Outstanding Amount of all L/C Obligations shall not exceed the Availability; and (c) the amount of Recourse Debt (excluding the Loans and L/C Obligations) shall not exceed 15% of the Gross Asset Value.
Debt Ratios. (a) The amount of Unsecured Debt at the end of each calendar quarter shall not exceed 60% of the Unencumbered Property Value at such time; provided, however, that if at the end of any calendar quarter, for up to four calendar quarters during the term of this Agreement, the amount of Unsecured Debt exceeds 60% of Unencumbered Property Value but is less than 65% of Unencumbered Property Value then the amount of Unsecured Debt at the end of each such calendar quarter, may exceed 60%, but shall not exceed 65%, of Unencumbered Property Value at such time; (b) the Outstanding Amount of all Loans (including all Swing Loans and Bid Loans) plus the Outstanding Amount of all L/C Obligations shall not exceed the Availability at such time; and (c) the amount of Secured Recourse Debt at the end of each calendar quarter shall not exceed 10% of the Gross Asset Value at such time.
Debt Ratios. (a) The amount of Unsecured Debt at the end of each calendar quarter shall not exceed 60% of the Unencumbered Property Value at such time; (b) the Outstanding Amount of all Loans (including all Swing Loans and Bid Loans) plus the Outstanding Amount of all L/C Obligations shall not exceed 60% of the Unencumbered Asset Pool Value; and (c) the amount of Secured Recourse Debt at the end of each calendar quarter shall not exceed 10% of the Gross Asset Value at such time.
Debt Ratios. If we fail to comply with these tests, the lenders have the right to cause all amounts outstanding under the bank credit facility to become immediately due. If this was to occur and the lenders decide to exercise their right to accelerate the indebtedness, it would create serious financial problems for us. Our ability to comply with these restrictions, and any similar restrictions in future agreements, depends on our operating performance. Because our performance is subject to prevailing economic, financial and business conditions and other factors that are beyond our control, we may be unable to comply with these restrictions in the future. BECAUSE WE HAVE SIGNIFICANT FIXED PAYMENTS ON OUR DEBT, WE MAY LACK SUFFICIENT CASH FLOW TO OPERATE OUR BUSINESS AS WE HAVE IN THE PAST AND MAY NEED TO BORROW MONEY IN THE FUTURE TO MAKE THESE PAYMENTS AND OPERATE OUR BUSINESS. We have borrowed substantial amounts of money in the past and may borrow more money in the future. At June 30, 2000, Lamax Xxxertising Company had approximately $288 million of convertible notes outstanding. At June 30, 2000, Lamax Xxxia had approximately $1,553 million of debt outstanding consisting of approximately $1 billion in bank debt, $541 million in various series of senior subordinated notes of Lamax Xxxia and $12 million in various other short-term and long-term debt of Lamax Xxxia. This debt of Lamar Advertising and Lamax Xxxia represents approximately 56% of our total capitalization. A large part of our cash flow from operations must be used to make principal and interest payments on our debt. If our operations make less money in the future, we may need to borrow to make these payments. In addition, we finance most of our acquisitions through borrowings under Lamax Xxxia's bank credit facility which presently has a total committed amount of $1.25 billion in term and revolving credit loans. At June 30, 2000, we had approximately $249 million available to borrow under this bank credit facility. Since our borrowing capacity under Lamax Xxxia's bank credit facility is limited, we may not be able to continue to finance future acquisitions at our historical rate with borrowings under this bank credit facility. We may need to borrow additional amounts or seek other sources of financing to fund future acquisitions. We cannot guarantee that additional financing will be available or available on favorable terms. We also may need the consent of the banks under Lamax Xxxia's bank credit facility...
Debt Ratios. Debt to Net Worth 0.00 0.00 0.00 n.a Current Liab. to Liab. 0.00 0.00 0.00 n.a Liquidity Ratios Net Working Capital $195,684 $321,474 $451,893 n.a Interest Coverage 0.00 0.00 0.00 n.a Additional Ratios Assets to Sales 0.31 0.28 0.27 n.a Current Debt/Total Assets 0% 0% 0% n.a Acid Test 0.00 0.00 0.00 n.a Sales/Net Worth 3.24 3.52 3.65 n.a Dividend Payout 0.00 0.00 0.00 n.a Table: Sales Forecast Sales Forecast Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11 Month 12 Sales Fuel $210,970 $215,189 $219,493 $223,883 $228,361 $232,928 $237,587 $242,339 $247,186 $252,130 $257,173 $262,316 Convenient Store $25,068 $26,321 $27,637 $29,019 $30,470 $31,994 $33,594 $35,274 $37,038 $38,890 $40,834 $42,876 [YOUR COMPANY NAME] $25,068 $26,321 $27,637 $29,019 $30,470 $31,994 $33,594 $35,274 $37,038 $38,890 $40,834 $42,876 Boat Fuel & Other $10,000 $10,000 $10,000 $10,000 $10,000 $10,000 $10,000 $10,000 $10,000 $10,000 $10,000 $10,000 Lotto etc. $4,167 $4,167 $4,167 $4,167 $4,167 $4,167 $4,167 $4,167 $4,167 $4,167 $4,167 $4,167 Total Sales $275,273 $281,998 $288,934 $296,088 $303,468 $311,083 $318,942 $327,054 $335,429 $344,077 $353,008 $362,235 Direct Cost of Sales Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11 Month 12 Fuel $203,435 $207,504 $211,654 $215,887 $220,205 $224,609 $229,102 $233,684 $238,358 $243,125 $247,988 $252,947 Convenient Store $16,796 $17,635 $18,517 $19,443 $20,415 $21,436 $22,508 $23,634 $24,815 $26,056 $27,359 $28,727 [YOUR COMPANY NAME] $17,548 $18,425 $19,346 $20,313 $21,329 $22,396 $23,516 $24,692 $25,927 $27,223 $28,584 $30,013 Boat Fuel & Other $8,500 $8,500 $8,500 $8,500 $8,500 $8,500 $8,500 $8,500 $8,500 $8,500 $8,500 $8,500 Lotto etc. $3,958 $3,958 $3,958 $3,958 $3,958 $3,958 $3,958 $3,958 $3,958 $3,958 $3,958 $3,958 Subtotal Direct Cost of Sales $250,237 $256,022 $261,975 $268,101 $274,407 $280,899 $287,584 $294,468 $301,558 $308,863 $316,389 $324,146 Table: Personnel Personnel Plan Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11 Month 12 Manager $2,375 $2,375 $2,375 $2,375 $2,375 $2,375 $2,375 $2,375 $2,375 $2,375 $2,375 $2,375 Clerks $8,856 $8,856 $8,856 $8,856 $8,856 $8,856 $8,856 $8,856 $8,856 $8,856 $8,856 $8,856 Total People 5 5 5 5 5 5 5 5 5 5 5 5 Total Payroll $11,231 $11,231 $11,231 $11,231 $11,231 $11,231 $11,231 $11,231 $11,231 $11,231 $11,231 $11,231 Table: Profit and Loss Pro Forma Profit and Loss Mont...
Debt Ratios. (i) permit the Senior Debt Ratio measured as of the end of each fiscal quarter (commencing with the fiscal quarter ended February 20, 2004) to be more than 2.0x, or (ii) permit the Total Debt Ratio measured as of the end of each fiscal quarter (commencing with the fiscal quarter ended February 20, 2004) to be more than 3.5x;
Debt Ratios permit the Senior Debt Ratio measured as of the end of each fiscal quarter to be more than 2.5x.”
