Debt Schedule Explanation

Debt Schedule Explanation - Debt Schedule Detailed...

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Debt Schedule Detailed Explanation Need a Plug (Gets the Balance Sheet to Balance) 3 Cases 1) Prepay some of debt (or 0 debt) 2) Prepay all of debt money left over goes to Excess Cash 3) Cannot pay debt need to borrow from Revolver Planned Debt Retirement Could be higher than Required Debt Payment (e.g. paying off mortgage early). For now we will assume they are the same. Can’t be lower than Required Debt Payment since under most circumstances you don’t “plan” for bankruptcy ( e.g. put GM prepackaged bankruptcy scenarios aside for now ) = Debt Balance of Term Loan / Number of Years to Amortize Debt No need to pay Revolver now, since it is a temporary credit facility. Senior Sub Notes are often a permanent part of the capital structure, so no need to pay. Required Debt Retirement =MIN (Scheduled Debt Retirement noted above, or Debt Balance) MIN function ensures you can’t pay more than the Debt Balance Scheduled Debt Retirement ensures you are paying at least the Required Debt Payment ( i.e. no bankruptcy
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