medium · Private Credit & Debt documentation-covenants-terms
A borrower, Ironwood Manufacturing, generates $50,000,000 in LTM Adjusted EBITDA and carries $225,000,000 in Total Debt. The credit agreement contains a maximum Total Leverage covenant of 5.50x.
What is the maximum percentage that EBITDA can decline before a technical covenant breach occurs?
- 18.18%
- 10.00%
- 22.22%
- 9.09%
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