Basket stacking

Using multiple contractual baskets or permissions together. Whether their capacities can be combined depends on the transaction, definitions, conditions and rules against double counting.

Basket stacking in round numbers

Hypothetical: a credit agreement permits US$20m of debt, US$15m of investments and US$10m of restricted payments under separate provisions. Those figures do not automatically permit a US$45m outflow. A debt-funded investment may need to satisfy both the debt and investment permissions for the same transaction, while a distribution must satisfy the applicable restricted-payment rules.

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