Rent coverage ratio clause samples

(2) Maintenance of Interest and Rent Coverage Ratio. Maintain a minimum Interest and Rent Coverage Ratio of ● at all times.

Table of Contents December31, 2015, year one rent under the Master Lease of $550.0million, or (ii)for the year ended December31, 2016, rent under the Master Lease of $591.7million, which reflects year one rent under the Master Lease of $550.0million prorated for the period prior to the Borgata Transaction, and $650.0million prorated for the remainder of the lease year following the closing of the Borgata Transaction on August1, 2016. For a calculation of MGM’s historical corporate rent coverage ratio, see “Annex II—Calculation of MGM Historical Corporate Rent Coverage Ratio.” We use MGM’s historical corporate rent coverage ratio to illustrate our Tenant’s ability to meet its obligations under the Master Lease. The numerator to the calculation of MGM’s historical corporate rent coverage ratio for the year ended December31, 2016 shown above includes Adjusted Property EBITDA with respect to MGM National Harbor following its opening on December8, 2016 and Adjusted Property EBITDA with respect to Borgata following its acquisition on August1, 2016. However, the denominator to the calculation of the ratio shown above does not reflect what the rent would have been under the Master Lease had MGM National Harbor been subject to the Master Lease following its opening on December8, 2016. In addition, the ratio shown above does not reflect what the historical corporate rent coverage ratio would have been had Borgata and MGM National Harbor been included in MGM’s operating results (and, in the case of MGM National Harbor, had it been fully stabilized) and had such properties been subject to the Master Lease for the entire period presented. On August1, 2016, Borgata was added to the existing Master Lease between the Landlord and the Tenant. As a result, the initial annual rent amount under the Master Lease increased by $100.0million to $650.0million, prorated for the remainder of the first lease year. Furthermore, upon the completion of the proposed MGM National Harbor Transaction, it is anticipated that the Master Lease will be amended to add MGM National Harbor, increasing the annual rent amount under the Master Lease by $95.0million to $756.7million, prorated for the remainder of the lease year.