medium · Corporate Credit Analysis
A borrower has a springing covenant that activates when the Revolver is drawn at 35% of its $200 million commitment. Current draw is $80 million. Debt is $600 million and EBITDA is $120 million.
If the springing covenant is a 6.00x Total Leverage test, what is the cushion?
- 1.17x
- No cushion / Covenant inactive
- 5.00x
- 1.00x
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