medium · Private Credit & Debt documentation-covenants-terms
If a loan is issued at 98 and includes a 'Make-Whole' provision for the first 2 years, what is the primary risk to the borrower when refinancing early?
- The cost of paying the NPV of all remaining interest through the end of the protection period
- The immediate forfeiture of the 2% OID to the lender
- The requirement to pay a 2% flat premium on top of the make-whole
- The risk that the lender will refuse to accept the repayment
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