LeverMap
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How much debt does this business service?
How much debt the cash flow services, which covenant binds first, and how fast the sweep delevers.
Your numbers
Starting numbers: A mid-market business with steady earnings, being sized for an acquisition facility. Change anything below.
Annual operating profit before financing and accounting charges. The number a lender sizes debt against.
All-in annual cost of the borrowing.
The most debt the lender allows, as a multiple of annual earnings.
How many times cash flow must cover the debt payments. Below this the lender can call the loan.
Cash that leaves before debt is served, so it cannot be counted towards cover.
Share of the principal repaid each year.
Share of spare cash the lender takes against the balance each year.
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Headroom under the leverage covenant
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How it's computed
About this calculator
Debt capacity is set by whichever test bites first. The leverage covenant caps the facility at a multiple of EBITDA; the cash cover test caps it at what the business can actually service after tax and capex, with the required cushion on top. The model runs both and takes the lower - that is the real ceiling, and the binding covenant tells you where the structure is fragile. Headroom on the leverage test shows how much an EBITDA miss can be absorbed, and the sweep line shows how quickly excess cash pays the facility down in the first year. Pull the levers to see how the ceiling moves with rates, covenants, and earnings - note how often the binding test flips as rates rise. Then save the model with your own numbers to test amortisation schedules, sweep terms, and downside EBITDA, and share the structure with your deal team.
Every number on this page is computed live by the LeverMap engine.