DDC and Bank are finalizing the terms of a $200MM Unsecured Term Loan (UTL) with an interest rate of 5%.As part of the loan, DDC agrees it wil payoff the $50MM venture loan it previously arranged.Bank is proposing a negative covenant in the UTL that requires DDC to maintain an Interest Coverage ratio of 2.0x.The Interest Coverage ratio is defined as:EBITDA / Total Interest Expense.Assuming the loan closes and funds on 1/1/19 and that projected EBITDA in 2019 is $30MM (regardless of what you might calculate from the projection), DDC would expect to be?

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To solve this problem we need to calculate the expected Interest Coverage ratio ... View the full answer