CONSOLIDATED EBITDA
EX-10.29 2 w58343exv10w29.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 six months ended March 31, 2008, the quotient of Consolidated Net Debt divided by Consolidated EBITDA for the six month period, multiplied by two was required to be not less than 5.0 in order for the Company to be compliant with covenant requirements of the notes. The Company was in compliance with the required covenant at March 31, 2008.
The following table reconciles our consolidated net earnings per GAAP to Consolidated EBITDA:
| Six Months | ||||
| Ended | ||||
| March 31, | ||||
| 2008 | ||||
| Consolidated Net Loss | $ | (4,847 | ) | |
| Any extraordinary or non recurring gains or losses | ||||
| Loss from disposed operations, net of tax | 1,300 | |||
| (Gain) Loss on sale of subsidiaries | 387 | |||
| Non-cash charges that do not result in future cash obligations | ||||
| Loss (Gain) from fair value of notes and warrants | 1,210 | |||
| (Gain) Loss from Sale of Fixed Assets | 217 | |||
| Non-cash expenses associated with stock compensation expense | 376 | |||
| Adjusted Net Loss before | $ | (1,357 | ) | |
| Interest Income | (504 | ) | ||
| Interest Expense | 3,442 | |||
| Income tax expense | 151 | |||
| Depreciation Expense | 2,888 | |||
| Amortization Expense | 557 | |||
| Any non-cash transactions | ||||
| Foreign currency losses | 218 | |||
| Adjustments related to Inventory | 374 | |||
| Bad Debt Expense | 42 | |||
| Hedge or non-hedge derivative adjustments | — | |||
| Consolidated EBITDA | $ | 5,811 | ||
| Other Financial Disclosure Required based on terms of notes: | ||||
| Consolidated Net Interest Expense | $ | 2,938 | ||
| Consolidated Net Debt (Total Debt less Cash and Cash Equivalents) at March 31, 2008 | $ | 33,125 | ||
| Quotient of Consolidated Net Debt divided by 2 times of Consolidated EBITDA | 2.85 | |||
| Covenant Requirement — not more than | 5.00 | |||
| Covenant Status | PASSED | |||
