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Leveraged Finance Covenant Training Course (FLT-LFCT)


Description


The Leveraged Finance Covenant Training Course is designed to provide participants with a comprehensive understanding of leveraged finance, including the structure and significance of covenants in loan agreements. This course covers the various types of covenants, their key components, and their implications for borrowers and lenders.

Participants will learn how covenants can affect a company's financial health, the importance of compliance, and the consequences of breaches. Practical case studies and examples will be utilized to illustrate how covenants operate in real-world scenarios.

By the end of the course, participants will be equipped with the knowledge to analyze and negotiate covenants effectively, enhancing their ability to make informed decisions in the leveraged finance market.


Starting Date: CPD Accredited: Yes

Content
  • 0. Introduction
  • Welcome to FLT's Leveraged Finance Covenant Training course!
  • Pre-Course Learner Survey
  • 1. Foundations
  • Introduction to Foundations
  • Goals of this Course & How Will We Achieve This
  • The “Leveraged Finance Market” / Landscape of the Market
  • Goals of the Parties
  • How Covenants Help Achieve Those Goals
  • A Brief History of Covenants: Overview
  • A Brief History of Covenants: Debt Covenant
  • A Brief History of Covenants: Liens Covenant
  • A Brief History of Covenants: Restricted Payments Covenant
  • A Brief History of Covenants: Asset Sales Covenant
  • A Brief History of Covenants: Change of Control Covenant
  • Deal Process & Timeline: Leveraged Loans / High Yield Bonds
  • Maintenance vs. Incurrence Covenants / “Cov-Lite”
  • Case Study: Introduction to the Monkey Business Case Study
  • Foundations - Quiz
  • 2. Capital Structure & Credit Support
  • Why Analyze the Capital Structure?
  • What is the Cap Stack?
  • Objectives of the Parties
  • Analyzing the Structure Chart
  • Why Does Credit Support Matter?
  • Subordination
  • Credit Support in the US vs Europe / The Intercreditor Agreement
  • Case Study: Analyzing the Structure Chart & Guarantor Coverage
  • Clause Lab: Analyzing the Structure Chart
  • Case Study: Analyzing the Collateral
  • Clause Lab: Analyzing the Collateral
  • Case Study: Analyzing the Collateral - BSL
  • Case Study - Guarantor Coverage Condition - BSL
  • Clause Lab: Guarantor Coverage
  • Step-by-Step: How to Analyze Capital Structure & Credit Support
  • Q&A - Market standard credit support & difference between a (non)-guarantor
  • Capital Structure & Credit Support - Quiz
  • 3. Debt & Liens
  • Why Analyze the Debt & Liens Covenants
  • RCF Springing Covenant - BSL
  • Case Study: Financial Covenant - BSL
  • Claude Lab: Financial Maintenance Covenant
  • Case Study: Equity Cure - BSL
  • Debt Covenant: How it works
  • Debt Covenant: Key Risks
  • Case Study: Incremental Facilities - BSL
  • Case Study - MFN Coniditon - BSL
  • Case Study: Maturity Condition - BSL
  • Ratio Debt Basket
  • CNI & EBITDA
  • Case Study: Ratio Debt Basket
  • Clause Lab: Ratio Debt Basket
  • Case Study: Ratio Debt Basket - BSL
  • Permitted Debt Baskets
  • Case Study: Available RP Capacity Amount - BSL
  • Case Study: Non-Guarantor Debt Basket - BSL
  • Case Study: Super Senior Debt Mechanics
  • Non-Guarantor Debt Incurrence
  • Case Study: Future Guarantor Covenant
  • Calculation Flexibility
  • Case Study: Reclassification & Designated Amounts
  • Case Study: Reclassification - BSL
  • Liens Covenant: How it Works & Key Risks
  • Permitted Collateral Liens: Most Important Baskets
  • Clause Lab: Permitted Collateral Liens Case Study
  • Case Study: Chasing Cross-References - BSL
  • Permitted Liens: Most Important Baskets & Case Study
  • Clause Lab: Permitted Liens Case Study
  • Case Study: Liens on Any Permitted Debt - BSL
  • How to Analyze Secured Debt Capacity
  • Q&A - Difference between Permitted Collateral Liens and Permitted Liens
  • Debt & Liens - Quiz
  • 4. Calculations Mechanics
  • Why Analyze Calculation Mechanics?
  • Covenant Calculations: Disclaimers
  • Covenant Calculations: Which line items?
  • Calculating Covenant Capacity Step-by-Step
  • Step 1: Financial Calculations Covenant & Key Risks
  • Step 2: When is the Calculation Being Made?
  • Case Study (part I): When is the Calculation Being Made?
  • Case Study (part II): When is the Calculation Being Made?
  • Clause Lab: When is the Calculation Being Made?
  • Case Study: When is the calculation being made? - BSL
  • Step 3: Which Numbers Are We Using? EBITDA
  • Case Study: Which Numbers Are We Using? EBITDA
  • Case Study: Which Numbers Are We Using? - EBITDA - BSL
  • Clause Lab: Which numbers are we using? EBITDA
  • Step 3: Which Numbers Are We Using? IFRS 16
  • Step 3: Which Numbers Are We Using? "Indebtedness" / "Secured Debt" & Case Study
  • Step 4: Ratio Calculations
  • Case Study: Ratio Calculations
  • Case Study - Ratio Calculations - BSL
  • Step 5: Basket Allocation & Reclassification
  • Case Study: Basket Allocation & Reclassification
  • Case Study: Reclassification - BSL
  • Step 6: Ongoing Monitoring of Capacity
  • Calculation Mechanics - Quiz
  • 5. Mid-Course Recap & Quiz
  • Recap: A Brief History of Covenants
  • Recap: Maintenance vs. Incurrence Covenants
  • Recap: Subordination
  • Recap: Why Does Credit Support Matter?
  • Recap: Step-by-Step How to Analyze Capital Structure & Credit Support
  • Recap: Debt Covenant - How it Works
  • Recap: Non-Guarantor Debt Incurrence
  • Recap: Liens Covenant - How it Works
  • Recap: Step-by-Step How to Analyze Secured Debt Capacity
  • Recap: Calculating Capacity Step-by-Step
  • Q&A: Unrestricted Subsidiary disclosure in HYB OM
  • Mid-Course Recap - Quiz
  • 6. Restricted Payments & Asset Sales
  • Why Analyze the Restricted Payments & Asset Sales Covenants?
  • Restricted Payments Covenant: How it Works
  • Restricted Payments Covenant: Key Risks
  • Restricted Payments Covenant and "The Box"
  • Definition of “Restricted Payment”
  • Case study: Definition of Restricted Paymen
  • Clause Lab: Definition of Restricted Payment
  • Build-up Basket: Conditions to Use
  • Case Study: Build-up Basket – Conditions to Use - HYB
  • Case Study: Build-up Basket – Conditions to Use - BSL
  • Clause Lab: Build-Up Basket Conditions
  • Build-up Basket: Capacity Calculations
  • Case Study: Build-up Basket - Capacity Calculations - HYB
  • Case Study: Build-up Basket - Capacity Calculations - BSL
  • Clause Lab: Build-up Basket - Capacity Calculations
  • Material Permitted Payments Baskets
  • Case Study: Permitted Payments & Asset Sales
  • Case Study: Permitted Payments & Asset Sales - BSL
  • Case Study: Available Amounts Basket - BSL
  • Material Permitted Investments Baskets
  • Case Study: Debt to Investment Toggle - BSL
  • Case Study: Playing Games with Unrestricted Subsidiaries
  • Step-by-Step: How to Analyze Restricted Payments Capacity
  • Asset Sales Covenant: How it Works
  • Asset Sales Covenant: Key Risks
  • “Asset Sale” Definition Carve-outs
  • FMV & C/CE Conditions
  • Case Study: C/CE De Minimis - BSL
  • Application of Proceeds Time Periods
  • Application of Proceeds
  • Case Study: Application of Proceeds
  • Case Study: Application of Proceeds - BSL
  • Clause Lab: Application of Proceeds
  • Excess Proceeds
  • Case Study: Excess Proceeds
  • Case Study: Leverage Excess Proceeds - BSL
  • Clause Lab: Leverage Excess Proceeds
  • Step-by-Step: How to Analyze the Asset Sales Covenant
  • Restricted Payments & Asset Sales - Quiz
  • 7. Economic Terms, Sweetheart Deals & Changes of Ownership
  • Why Analyze These Terms?
  • Pricing & Call Protection: HYBs vs LLs
  • Margin Ratchets - LL
  • Case Study: Margin Ratchets - BSL
  • MFN - LL Pricing Protection
  • Case Study: MFN Condition - BSL
  • HYB Redemption Provisions
  • Case Study: HYB Redemption Provisions
  • Mandatory Prepayments - BSL
  • Mandatory Prepayment - Excess Cashflow - BSL
  • Case Study: Mandatory Prepayments - Excess Cashflow - BSL
  • Clause Lab: Mandatory Prepayments - Excess Cashflow - BSL
  • Affiliate Transactions
  • Case Study: Affiliate Transactions
  • Case Study: Affiliate Transactions - BSL
  • Change of Control
  • Portability
  • Portability: How It Works
  • Portability: Key Risks
  • Case Study: Portability
  • Step-by-Step - Analyzing the Change of Control Covenant
  • Mergers
  • Transfers: HYBs vs. LLs
  • Restrictions on Transfer in LLs
  • Economic Terms, Sweetheart Deals & Changes of Ownership - Quiz
  • 8. ESG & Sustainability-Linked Transactions
  • ESG - What is it?
  • Regulation
  • ESG - Why does it matter?
  • Tools
  • Industry Guidance
  • Sustainability-Linked High Yield Bonds
  • SPTs
  • Case Study: HYB SPT Step-Up
  • Verification & Reporting: HY SLBs
  • ESG Margin Ratchets in Leveraged Loans
  • Verification & Reporting: ESG-Linked Margin Ratchets
  • Calculations
  • Timing of Negotiation: BSL vs. PD
  • ESG & Sustainability-Linked Instruments - Quiz
  • 9. Reports, Defaults, Amendments & Waivers
  • Why Analyze These Terms?
  • Reports: Overview
  • Reports: HYB
  • Case Study: HYB Reports
  • Information Undertakings: BSL
  • Case Study: Information Undertakings - BSL
  • Reports: LL
  • Defaults: Overview
  • Defaults: HYB
  • Case Study: HYB Defaults
  • Defaults: BSL
  • Defaults: LL
  • Amendments & Waivers: HYB
  • Case Study: HYB Amendments & Waivers
  • Case Study: Amendments & Waivers - BSL
  • Amendments & Waivers: Types & Thresholds
  • Amendment vs. Waiver
  • Case Study: Yank-a-Bank - BSL
  • Amendments & Waivers: LL
  • Reports, Defaults, Amendments & Waivers - Quiz
  • Final Exam - Basic Covenant Fluency
  • Basic Covenant Fluency Skills
  • Post-Course Learner Survey
  • Post-Course Learner Survey
Completion rules
  • All units must be completed
  • Leads to a certificate with a duration: Forever
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