The size of the freebie basket is an important business consideration, and while sponsors of the best animals, especially in the floor sector, often insist that it be measured at or above EBITDA, the amount of the freebie basket is rather in the range of a quarter to a half a turn of EBITDA. Often, the freebie basket can be used after the group has reached its limits among the proportional debt tests described above. Given the extent to which powerful borrowers aggressively attempt to increase the debt collection capacity of the borrower group, this freebie basket may, in some cases, be subject to a grower element that depends on the amount of EBITDA. In addition, the freebie basket can sometimes be increased taking into account certain increases, for example.B. Amounts returned to the group of lenders on the basis of voluntary advances, debt buybacks, repayments after the exercise of a Yank the Bank provision and/or other commitment reductions of existing priority debt before the date of appearance of the incremental facility concerned. In addition, it is often possible for the group of borrowers to absorb, in whole or in part, its incremental debt capacity outside the parameters of the facility arrangement as secondary car debt and/or as refinancing debt, none of which is provided for in the provisions of the AML. In most cases, a specific credit agreement contains only a few of these exceptions. In the case of promised financing, exceptions to the highest remuneration are often subject to a „Market Flex“ allowing arrangers to modify or remove waivers from the highest funding in order to facilitate syndication of the underlying debt. Modern credit facilities for syndicated loans give borrowers the opportunity to document the terms of a debt incurred under the additional provisions either (i) an increase in the size of an existing tranche of debt, (ii) a new tranche of stand-alone debt under the existing credit facility, or (iii) a new tranche of debt, documented under a separate credit facility.
If incremental debt is documented under a separate credit facility, many credit facilities provide additional flexibility for borrowers and may allow such debts in the form of bonds or loans. There are additional facilities that allow relatively quick access to liquidity by allowing additional unincurred maturities or revolving facilities, without the agreement of the lender, in advance, which can be used, provided that the group of borrowers and the incremental mechanism set up meet certain parameters agreed in advance. Additional facilities may be required for specific purposes, for example. B for acquisitions of own funds (mainly unrelated acquisition lines) or to cover general working capital requirements.
