CASH FLOW COVER definition
CASH FLOW COVER means, in relation to any Relevant Period, the ratio of Free Cash Flow to Total Debt Service (other than during the period falling prior to the end of the Term Availability Period any Indebtedness for Borrowed Money to be refinanced with any Advances) for such Relevant Period.
CASH FLOW COVER. Cash Flow Cover in excess of 1.20:1. Cash Flow Cover is defined as (net profit after tax plus non cash items such as depreciation and amortization) divided by (the required term debt payments plus cash funded fixed asset purchases plus dividends/withdrawals). All computations made to determine compliance with the covenant requirements shall be made in accordance with generally accepted accounting principals, applied on a consistent basis and certified by Borrower as being true and correct on a quarterly basis (except the cash flow cover which is tested on an annual basis) beginning December 31, 1996. As of September 30, 1996, the Borrower was out of compliance with the Cash Flow Cover covenant. The Lender has elected to forebear through March 15, 1997, subject to the terms outlined in the Forbearance Letter dated December 27, 1996.