GREY:WFREF - Post by User
Post by
qwqwon Aug 09, 2015 10:30pm
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Post# 24002096
Debt/EBITDA
Debt/EBITDA The debt / EBITDA ratio that the banks use to calculate interest rates
(see below) is not easy to lower.Selling production to lower debt doesn't
necessarily lower the ratio any.Debt drops,EBITDA drops and the ratio
could go up or down.Ones options are limited to selling properties with
little to no production,cutting costs to the bone,using CF to lower debt,
raising new capital and praying for higher prices.That's why the
issue was a necessary evil.
The banksters are going to make life very interesting in more ways
than one for the over leveraged.
| Debt/EBITDA | Base Rate | BA Stamping Fees/LIBOR Margin/LOC | Standby Fees |
| ≤1.00:1 | 100bps | 200bps | 50.00bps |
| >1.00 :1 1.50:1 | 125bps | 225bps | 56.25bps |
| ≥1.50 :1 2.00:1 | 150bps | 250bps | 62.50bps |
| ≥2.00:1 2.50:1 | 175bps | 275bps | 68.75bps |
| ≥2.50 :1 3.00:1 | 200bps | 300bps | 75.00bps |
| ≥3.00:1 3.50:1 | 250bps | 350bps | 87.50bps |
| ≥3.50:1 4.00:1 | 300bps | 400bps | 100.0bps |
| ≥4.00:1 | 350bps | 450bps | 112.5bps |