medium · Debt Capital Markets primary-issuance-syndication
A Senior Note portability threshold is 5.25x. Pro-forma for a sale, Debt is $2,100 million and EBITDA is $400 million. The issuer has $100 million of unrestricted cash and $50 million of restricted cash.
Is the 101% put triggered?
- No, because net leverage is 5.00x (using unrestricted cash).
- Yes, because gross leverage is 5.25x and indentures rarely allow cash netting for Change of Control.
- Yes, because any leverage above 5.0x is considered 'Highly Leveraged' and triggers the CoC put automatically.
- No, because net leverage is 4.88x (using all cash).
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