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Sensata Technologies Holding N.V.'s SEC Filings

S-1/A
SENSATA TECHNOLOGIES HOLDING PLC filed this Form S-1/A on 03/09/2010
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the information does not reflect certain changes that have occurred in our operations as a result of or after our separation from Texas Instruments.

 

Accordingly, our historical results of operations may not be indicative of our future operating or financial performance.

 

Our business may not generate sufficient cash flow from operations, or future borrowings under our Senior Secured Credit Facility or from other sources may not be available to us in an amount sufficient, to enable us to repay our indebtedness, including our existing Senior Notes and Senior Subordinated Notes, or to fund our other liquidity needs, including capital expenditure requirements.

 

We cannot guarantee that we will be able to obtain enough capital to service our debt and fund our planned capital expenditures and business plan. If we complete additional acquisitions, our debt service requirements could also increase. If we cannot service our indebtedness, we may have to take actions such as selling assets, seeking additional equity investments or reducing or delaying capital expenditures, strategic acquisitions, investments and alliances, any of which could have a material adverse effect on our operations. Additionally, we may not be able to effect such actions, if necessary, on commercially reasonable terms, or at all.

 

Our failure to comply with the covenants contained in our credit arrangements, including as a result of events beyond our control, could result in an event of default which could materially and adversely affect our operating results and our financial condition.

 

Our Senior Secured Credit Facility requires us to maintain specified financial ratios, including a maximum ratio of total indebtedness to Adjusted EBITDA (earnings before interest, taxes, depreciation and amortization and certain other adjustments as defined in the Senior Secured Credit Facility) and a minimum ratio of Adjusted EBITDA to interest expense, and maximum capital expenditures. In addition, our Senior Secured Credit Facility and the indentures governing the Senior Notes and Senior Subordinated Notes require us to comply with various operational and other covenants. For purposes of the Senior Secured Credit Facility, Adjusted EBITDA is calculated using various add-backs to EBITDA. During the fourth quarter of fiscal year 2009, the leverage and coverage ratios tightened from 2008 and will further tighten during the fourth quarter of fiscal year 2010. The table below outlines the leverage and interest coverage ratios in accordance with the covenants in the Senior Secured Credit Facility and the minimum Adjusted EBITDA amounts that would be required in order to maintain compliance with the leverage ratio and interest coverage ratio based on total indebtedness at December 31, 2009 and interest expense for the fiscal year ended December 31, 2009.

 

Effective as of

   Maximum
Leverage
ratio covenant
   Minimum Required
LTM Adjusted
EBITDA to maintain
compliance based on
December 31,
2009 indebtedness(1)
   Minimum
Interest
coverage
ratio covenant
   Minimum Required
LTM Adjusted
EBITDA to maintain
compliance based on
fiscal year ended
December 31, 2009
interest expense(1)

Fourth quarter 2008

   8.00:1      NA    1.40:1      NA

Fourth quarter 2009

   7.50:1    $ 288.9    1.50:1    $ 210.4

Fourth quarter 2010

   7.00:1    $ 309.5    1.60:1    $ 224.4

Fourth quarter 2011

   7.00:1    $ 309.5    1.60:1    $ 224.4

Fourth quarter 2012

   7.00:1    $ 309.5    1.60:1    $ 224.4

 

(1)   Amounts are stated in millions and based on total indebtedness (as defined in the Senior Secured Credit Facility) of $2,166.8 million at December 31, 2009 and interest expense (as defined in the Senior Secured Credit Facility) of $140.3 million for the fiscal year ended December 31, 2009.

 

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