easy · Corporate Credit Analysis
What is the primary objective of a 'Cash Sweep' provision in a credit agreement?
- To prevent the company from using cash to pay interest on junior debt.
- To allow the lender to seize the company's cash accounts at any time.
- To provide the company with a revolving line of credit for working capital.
- To ensure that a percentage of excess cash flow is used to prepay the debt principal.
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