senior net leverage ratio

Rather than offer unrestricted portability, lenders may pre-approve a list of permitted acquiring entities or define minimum characteristics the new owner must meet, such as minimum capital or AUM. J.P. Morgan Securities LLC is serving as financial advisor to Centene, and Skadden, Arps, Slate, Meagher & Flom LLP is serving as its legal counsel. Your request has been identified as part of a network of automated tools outside of the acceptable policy and will be managed until action is taken to declare your traffic. In addition, we disclaim any obligation to update any forward-looking statements to reflect events or circumstances that occur after the date of this press release. Additional Information and Where to Find It:Financial Details and Webcasthttp://ir.evolenthealth.com/overview/, Information About Evolent Healthhttps://www.evolenthealth.com/, Evolent Health, Media Contact:Media [email protected], Evolent Health, Investor Relations Contact:Seth R. [email protected], NIA Media Contact:Suzy [email protected](314) 445-0790, View original content to download multimedia:https://www.prnewswire.com/news-releases/evolent-health-announces-acquisition-of-specialty-asset-nia-and-strategic-partnership-with-centene-301682153.html. Leverage Ratios Notwithstanding anything to the contrary contained herein, for purposes of calculating any leverage ratio herein in connection with the incurrence of any Indebtedness, (a) there shall be no netting of the cash proceeds proposed to be received in connection with the incurrence of such Indebtedness and (b) to the extent the Indebtedness to be incurred is revolving Indebtedness, such incurred revolving Indebtedness (or if applicable, the portion (and only such portion) of the increased commitments thereunder) shall be treated as fully drawn. Based on the risk profile of the company, the lender lends at an annual interest rate of 7%. Once the rate of requests has dropped below the threshold for 10 minutes, the user may resume accessing content on SEC.gov. Lender A lends $1 million to a company. Upon close, the NIA team and platform will be fully integrated into Evolent's value-based specialty care business, which includes New Century Health, Vital Decisions and IPG. As it is borrowed money, each layer of debt has a corresponding interest rate payment schedule, where the company will make regular principal and interest payments. Covenant-based on the ratio of net debt to Cons. EVOLENT HEALTH ANNOUNCES ACQUISITION OF SPECIALTY ASSET NIA AND STRATEGIC PARTNERSHIP WITH CENTENE, Knowledge If it develops, the trend-setters are likely to be strong borrowers who were only moderately impacted by COVID-19 who are also backed by sponsors with established reputations amongst lenders. Typically, in the event a borrower is acquired, it must pay back the debt in full or refinance it under new terms. However, there are certain things to be aware of: Covenants differ based on the business, whether the financing at hand is secured or unsecured, and cash-flow based or asset-based. Debt covenants are restrictions that lenders (creditors, debt holders, investors) put on lending agreements to limit the actions of the borrower (debtor). Something went wrong while submitting the form. Senior Net Leverage Ratio means, as of the last day of any fiscal quarter of Loan Parties, the ratio of (i) (a) Senior Debt as of the last day of any fiscal quarter of Loan Parties minus (b) the total cash on deposit in the Borrowers ' Deposit Accounts (other than Restricted Accounts) as of the last day of such fiscal quarter to (ii) Loan Partie. To participate, please dial855-940-9467or412-317-6034for international callers and referencing the "Evolent Health call" 15 minutes prior to the call (Confirmation number 10173552). Seth Blackley, Chief Executive Officer of Evolent, stated, "Today's announcement represents another step forward in Evolent's journey to become a national leader in value-based specialty care, and we believe it will also improve our financial profile, customer diversification and scale. Thank you! of Pro Forma Senior Debt Net Leverage Ratio as of July 31, 2021 Non-GAAP Financial Measures To provide investors with additional information regarding the Company in addition to that as determined by generally accepted accounting principles in the United States ("GAAP"), To allow for equitable access to all users, SEC reserves the right to limit requests originating from undeclared automated tools. Enroll now for FREE to start advancing your career! Consolidated First Lien Net Leverage Ratio, Consolidated Senior Secured Net Leverage Ratio, Consolidated Senior Secured Leverage Ratio. Finally, this acquisition brings complementary assets to a core Evolent business that is performing well, including strong revenue and margin growth heading into 2023. 1001 and 1030). Typically lenders will want the portability provision to be limited to a single use, in contrast to high-yield bonds, which can often be used more than once. Additional filters are available in search, Total Net Leverage Ratio The Loan Parties shall not suffer or permit the Total Net Leverage Ratio as of any date set forth below to be greater than the maximum ratio set forth in the table below opposite such date: Computation Period Ending: Maximum Total Net Leverage Ratio: March 31, 2019 9.00:1.00 June 30, 2019 7.50:1.00 September 30, 2019 6.00:1.00 December 31, 2019 5.00:1.00 March 31, 2020 5.75:1.00 June 30, 2020 5.75:1.00 September 30, 2020 5.75:1.00 December 31, 2020 5.75:1.00 March 31, 2021 5.25:1.00 June 30, 2021 5.25:1.00 September 30, 2021 and the last day of each fiscal quarter ending thereafter 3.50:1.00, Senior Leverage Ratio The Senior Leverage Ratio during any period set forth below shall not exceed the ratio set forth below opposite such period: SENIOR PERIOD LEVERAGE RATIO ------ -------------- March 31, 2002-December 30, 2002 5.25:1.00 December 31, 2002-December 30, 2003 3.25:1.00 December 31, 2003 and thereafter 2.50:1.00. Given the delicate balance between lenders concerns and benefits to private equity sponsors, there are several points of contention we expect to be front-and-center if portability migrates into the core middle market in a real way. The upfront consideration will be funded in part by $250 million in Evolent equity issued to the sellers at a price of $29.50, a 24% premium to the prior day's closing price, subject to lock-up provisions. A Leverage Ratio measures a company's inherent financial risk by quantifying the reliance on debt to fund operations and asset purchases, whether it be via debt or equity capital. Once a company has achieved the type of scale that allows for leverage, it will typically have to commit to certain covenants, whether working with a bank or institutional investor. If a user or application submits more than 10 requests per second, further requests from the IP address(es) may be limited for a brief period. In order to provide you with the optimal experience, how would you describe yourself? New risk factors emerge from time to time, and it is not possible for management to predict all such risk factors. The company expects 2023 cash generation (excluding funded earnouts and typical transaction expenses) to exceed $120 million before interest expense, providing strong coverage on near-term debt service. They show how much of an organization's capital comes from debt a solid indication of whether a business can make good on its financial obligations. Risk management aside, lenders also enjoy the fees that would normally accompany a new origination or refinancing. Anyone reading this press release should seek advice based on their particular circumstances from independent legal, tax and business advisors. Centene uses its investor relations website to publish important information about Centene, including information that may be deemed material to investors. Testimonials reflected on this site may not be representative of the experience of other customers and the testimonial is not a guarantee of future performance or success. Other borrowers and sponsors would then follow suit. If the company goes bankrupt, unsecured senior debtholders are first in line to get paid off from the assets of the company, excluding any pledged assets for secured senior debtholders. In particular, these include statements relating to our guidance and business outlook and future performance, leverage or financial results, including of NIA, and our strategy. However, this is being seen less and less often, particularly in the high-yield space. Nothing on this Site constitutes investment, legal or tax advice and we do not advise on the tax consequences of any investment. Please declare your traffic by updating your user agent to include company specific information. Within the finance and banking industry, no one size fits all. We believe this announcement aligns with our core operating priorities of revenue growth, margin expansion and disciplined capital allocation, all for the benefit of our shareholders. Our solutions encompass total cost of care management, specialty care management, and administrative simplification. ", John Johnson, Chief Financial Officer of Evolent, stated, "We believe the NIA acquisition is financially attractive and is expected to immediately enhance our Adjusted EBITDA margin and cash flow profile. Portability is often based on a leverage test, most commonly Net Leverage. The Company undertakes no obligation to update forward-looking statements if circumstances or managements estimates or opinions should change except as required by applicable securities laws. These ratios provide an indication of how the company's assets and business operations are financed (using debt or equity). We want to provide the best possible experience for our users. Financial Modeling & Valuation Analyst (FMVA), Commercial Banking & Credit Analyst (CBCA), Capital Markets & Securities Analyst (CMSA), Certified Business Intelligence & Data Analyst (BIDA), Financial Planning & Wealth Management (FPWM), Debt restrictions protect the lender by prohibiting certain actions by the borrowers. The Company plans to prioritize debt paydown in future capital allocation, targeting a senior net leverage ratio of under 1.2-times and total net leverage ratio of under 2.0-times in 2024. A forward-looking statement is a statement that is not a historical fact and, without limitation, includes any statement that may predict, forecast, indicate or imply future results, performance or achievements, and may contain words like: "believe," "anticipate," "expect," "estimate," "aim," "predict," "potential," "continue," "plan," "project," "will," "should," "shall," "may," "might" and other words or phrases with similar meaning in connection with a discussion of future operating or financial performance. Structured Query Language (known as SQL) is a programming language used to interact with a database. Excel Fundamentals - Formulas for Finance, Certified Banking & Credit Analyst (CBCA), Business Intelligence & Data Analyst (BIDA), Commercial Real Estate Finance Specialization, Environmental, Social & Governance Specialization, Cryptocurrency & Digital Assets Specialization (CDA), Business Intelligence Analyst Specialization, Financial Planning & Wealth Management Professional (FPWM). Debt restrictions benefit the borrower by reducing the cost of borrowing. Builds on the proven Evolent Health Clinical Solutions growth engine as a leading independent provider of value-based specialty care, improving quality and lowering health care costs. As shown in the diagram above, financing the company through senior debt provides the lowest risk and highest priority of repayment for the lender, as compared to other types of debt. Sponsors can essentially wait until earnings are at a peak to trigger portability. If the company turns around and borrows more money from additional lenders, the loan will be a riskier proposition. Borrower shall not permit the Senior Net Leverage Ratio to be: Sample 1 Senior Net Leverage Ratio. Broad opportunities to further expand the Centene partnership. The company cannot borrow debt that is senior to this debt. Center, http://ir.evolenthealth.com/event-calendar/default.aspx, https://www.prnewswire.com/news-releases/evolent-health-announces-acquisition-of-specialty-asset-nia-and-strategic-partnership-with-centene-301682153.html, Accelerates Evolent Health's Value-Based Specialty Care Market Leadership, Transaction Anticipated to be Immediately Accretive to Adjusted EBITDA Margins and Cash Flow, Highly Complementary Business Expected to Add $85 Million of High-Visibility Adjusted EBITDA by 2024; Maintains Strong Balance Sheet, Diversifies Evolent's Revenue Base and Increases Cross-Sell Opportunity from $16 Billion to $50 Billion, Expands Centene Customer Relationship with New NIA Contract Expansions and is Expected to Accelerate Pace of Remaining Evolent Cross-Sell Opportunity with Centene. Forward-Looking Information: Information set forth herein contains Forward-looking information, including financial outlook, which generally reflect the Companys expectations and projections regarding future events. To advance your career as an analyst, these CFI resources will be helpful: Within the finance and banking industry, no one size fits all. We want to provide the best possible experience for our users. Subscribe to get thought leadership from Configure Partners direct to your inbox. Furthermore, to maintain a healthy financial system, financial regulators implement standards and requirements that encourage banks to take less risk and focus more on offering senior financial products. The Limited Condition Acquisition provision was originally engineered to protect against the risk of earnings movements between entering and closing an acquisition transaction. The debt agreement could specify the following debt covenants: When a debt covenant is violated, depending on the severity, the lender can do several things: CFI is a global provider of financial modeling coursesand also offers financial analyst certification training. The term 'leverage ratio' refers to a set of ratios that highlight a business's financial leverage in terms of its assets, liabilities, and equity. This allows lenders to reassess the new owners credit quality, evaluate any changes in operating or management structures, and adjust covenant levels, provisions, and interest rates to the now-prevailing market. Consolidated Net Leverage Ratio Permit the Consolidated Net Leverage Ratio as of the end of any fiscal quarter of the Borrower to be greater than 4.50:1.00. In the following days, the company declares a liquidating dividend to all shareholders. Financial and other information about Centene is routinely posted and is accessible on Centene's investor relations website, https://investors.centene.com/. Centene offers affordable and high-quality products to nearly 1 in 15 individuals across the nation, including Medicaid and Medicare members (including Medicare Prescription Drug Plans) as well as individuals and families served by the Health Insurance Marketplace, the TRICARE program and individuals in correctional facilities. Debtholders, typically bondholders and banks, are entitled to repayment before shareholders, should the company go through bankruptcy and liquidation. Companies can usually expect covenants to be categorized as either affirmative or negative. By becoming familiar with the most frequently-used covenants in the lending markets, borrowers can negotiate ratios that work for their specific business, identifying a common series of metrics by which they can discuss performance with lenders and investors alike. These statements, including but not limited to estimates of Adjusted EBITDA, earnings growth, expected cost synergies and net leverage ratios, are only predictions based on our current expectations and projections about future events. This article illustrates what companies can expect with senior debt covenants, and ultimately, how covenants can be used to help both the lender and the borrower. Building confidence in your accounting skills is easy with CFI courses! You can also sign up for email updates on the SEC open data program, including best practices that make it more efficient to download data, and SEC.gov enhancements that may impact scripted downloading processes. We are excited to introduce ourselves to you and our unique way of working together. Although forward-looking statements contained in this presentation are based upon what the Company believes are reasonable assumptions, there can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Unsecured debt is different in that it does not have a pledged asset as collateral. It was initially introduced in the high-yield bond market to protect exiting and incoming owners from paying out expensive call protection on existing bonds, but portability has gradually migrated into leveraged loans as well. A portable capital structure may be particularly coveted by private equity sponsors looking for short-term investment opportunities or a short-term extension of an existing investment, as it can facilitate a quick exit from the business. Our website requires features that may not be fully supported by your current browser. Evolent Health, Inc. Some portability provisions have an 18-36-month sunset clause or have step-down leverage ratios tied to expiring time periods. Ratio for incurrence of senior secured debt under the Ratio Debt Basket is set at 0.26x above opening Consolidated Senior Secured Net Leverage Ratio (CSSNLR) providing capacity for incurrence of additional senior secured indebtedness at issue. The Tier 1 leverage ratio is calculated by dividing Tier 1 . Receive our latest perspectives on business issues, industry trends, and economic insights. Note: We do not offer technical support for developing or debugging scripted downloading processes. 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With CFI courses resume accessing content on SEC.gov support for developing or debugging scripted downloading processes, this being! Seek advice based on their particular circumstances from independent legal, tax and advisors...

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