EX-12.2 17 computationofotherratios.htm COMPUTATION OF OTHER RATIOS computationofotherratios.htm
Exhibit 12.2

 
Alpha Natural Resources, Inc
Computation of Other Ratios
As of December 31, 2008
(Amounts in thousands except ratios)
       
Interest Coverage Ratio: The interest coverage ratio is defined as Adjusted EBITDA divided by net cash interest expense (defined as interest expense plus/minus the annual change in accrued interest less interest income and amortization of loan costs).
       
Adjusted EBITDA (1)
  $ 534,209  
Interest Expense
    40,193  
Cash payment on early extinguishment of debt
    10,736  
Interest on guaranteed debt
    42  
Annual change in accrued interest
    (876 )
Interest Income
    (7,353 )
Amoritization of loan costs
    (9,632 )
Net Cash Interest Expense
  $ 33,110  
         
Interest Coverage Ratio
    16.13  
         
(1) Adjusted EBITDA is defined and calculated in “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Analysis of Material Debt Covenants” in our 2008 Quarterly Report on Form 10-Q.
         
Leverage Ratio: The leverage ratio is defined as total net debt (defined as the sum of note payable and long-term debt less cash and cash equivalents) divided by Adjusted EBITDA.
         
Note payable
  $ 18,520  
Long-term debt
    520,625  
Cash and cash equivalents
    (676,190 )
Total Net Debt
  $ (137,045 )
         
Adjusted EBITDA
  $ 534,209  
         
Leverage Ratio
 
NM
 
         
Senior Secured Leverage Ratio: The senior secured leverage ratio is defined as consolidated debt that is secured by a lien less unrestricted cash and cash equivalents to Adjusted EBITDA.
         
Term Loan B
  $ 233,125  
Cash and cash equivalents
    (676,190 )
Total Net Debt
  $ (443,065 )
         
Adjusted EBITDA
  $ 534,209  
         
Senior Secured Leverage Ratio
    (0.83 )
         
Liquidity Test: The liquidity test is defined as the sum of the unused commitments under the credit facility’s revolving line of credit plus our unrestricted cash and cash equivalents.
         
Unused revolving line of credit
  $ 292,425  
Cash and cash equivalents
    676,190  
         
Total Liquidity
  $ 968,615