Problems 6, 7, 8 and 9 are based on the following set of facts. Assume ABC Co. is interested in acquiring a firm in Country B as part of its global expansion plan. Assume that ABC Co. was bidding on an acquisition with the price based on a 6.0x multiple of the Target's trailing 12 months EBITDA, which has been confirmed to be 10,000,000 in Country B currency. The current exchange rate is 1.50, meaning $1.SOUSD will exchange into 1 Country B currency unit. ABC Co. seeks to finance 100% of the acquisition price. To complete the acquisition, assume that ABC Co. has two financing choices, both of which rely on the new cash flow of the acquisition target as well as the credit strength of ABC Co.: First, it can finance the acquisition with a two part facility. The first part will be senior loan provided by its U.S. based bank at an interest rate of 5 percent, and based on a maximum loan size equal to a leverage multiple of 2.5x TTM EBITDA of the target. The remainder of the facility will be provided by a U.S. based mezzanine lender at a rate of 12 percent. All payments under this I. approach will be due and payable to the bank in USD. As an alternative, ABC Co. has identified a so-called 'Uni-tranche' lender in Country B to provide a single loan in the full amount of the acquisition price based on a leverage multiple of 6x TTM EBITDA, priced at an interest rate of 10 percent. All payments under this approach will be due and ll. payable to the Country B bank in Country B currency. ABC Co. has conducted extensive analysis of the expected trend in the currency relationship between USD and Country B currency, and a conclusion has been reached that the USD will be expected to strengthern relative to Country B currency over the foreseeable future