CONSOLIDATED EBITDA

EX-10.29 2 w51733exv10w29.htm EX-10.29 exv10w29
 

Exhibit — 10.29
 
CONSOLIDATED EBITDA
 
Earnings before interest, taxes, depreciation and amortization, non-cash stock compensation and payments, non-cash charges that do not result in future cash obligations, any extraordinary or non recurring gains (losses) and any non-cash transactions (Consolidated EBITDA) is not intended to present a measure of performance in accordance with accounting principles generally accepted in the United States (GAAP). Nor should Consolidated EBITDA be considered as an alternative to statements of cash flows as a measure of liquidity. Consolidated EBITDA is included herein as means to measure operating performance that financial analysts, lenders, investors and other interested parties find to be a useful tool for analyzing companies.
 
The definition of Consolidated EBITDA is defined in the senior secured convertible notes as a measurement for meeting the notes covenant requirements. Consolidated Net Debt is defined as the sum of (a) aggregate stated balance sheet amount of all Indebtedness of the Company plus or minus (b) any adjustment required to include the Amended Notes at their face amount rather than fair value that is used for GAAP presentation, minus (c) the aggregate stated balance sheet amount of unrestricted cash and cash equivalents of the Company in accordance with GAAP. For the three months ended December 31, 2007, the quotient of Consolidated Net Debt divided by Consolidated EBITDA, multiplied by four was required to be not less than 6.0 in order for the Company to be compliant with covenant requirements of the notes. The Company was in compliance with the required covenant at December 31, 2007.


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The following table reconciles our consolidated net earnings per GAAP to Consolidated EBITDA:
 
         
    Three Months Ended
 		 
    December 31,
 		 
    2007  
 
Consolidated Net Loss
       
Any extraordinary or non recurring gains or losses
  $ (1,552 )
Loss from disposed operations, net of tax
    1,300  
Loss on sale of subsidiaries
    500  
Non-cash charges that do not result in future cash obligations
       
Gain from fair value of notes and warrants
    (23 )
Loss from Sale of Fixed Assets
    3  
Non-cash expenses associated with stock compensation expense
    194  
         
Adjusted Net Loss before
  $ 422  
Interest Income
    (336 )
Interest Expense
    1,642  
Income tax expense
    21  
Depreciation Expense
    1,425  
Amortization Expense
    279  
Any non-cash transactions
       
Foreign currency losses
    148  
Adjustments related to Inventory
    246  
Bad Debt Expense
    42  
Hedge or non-hedge derivative adjustments
    —  
         
Consolidated EBITDA
  $ 3,889  
         
Other Financial Disclosure Required based on terms of notes:
       
Consolidated Net Interest Expense
  $ 1,306  
         
Consolidated Net Debt (Total Debt less Cash and Cash Equivalents) at December 31, 2007
  $ 19,516  
         
Quotient of Consolidated Net Debt divided by Consolidated EBITDA, multiplied by 4
    1.25  
         
Covenant Requirement — not more than
    6.00  
Covenant Status
    PASSED  
         


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