medium · Private Equity
In the LBO of Apex Corp, the sponsor is reviewing a debt instrument that is contractually subordinated to the senior lenders, carries a 12% all-in interest rate (composed of 8% cash and 4% PIK), and includes warrants for 5% of the company's equity.
How should this instrument be classified?
- High-Yield Bonds
- Unitranche Debt
- Mezzanine Financing
- Second-Lien Debt
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