Cloud 9fin Syndication Nation — My neck, my back, my EBITDA-T addback
Jun 11, 2025
In this engaging discussion, James Wallick, Head of Legal at 9fin and credit document expert, delves into how recent tariff announcements are reshaping language in debt agreements. He draws parallels between the current financial landscape and responses to the COVID-19 pandemic. James also explains the implications of force majeure clauses and EBITDA adjustments, highlighting a case study on a Spanish waste management firm. The conversation offers invaluable insights into the evolving needs of companies navigating economic uncertainty.
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COVID EBITDA Adjustments Limited Impact
- COVID-related EBITDA adjustments were based on specific non-recurring costs like PPE or remote work IT expenses.
- These adjustments had limited impact as they didn't cover lost revenue, the biggest financial hit for many firms.
Tariffs Rare in Debt Documents
- 2018 tariffs on China saw little inclusion in debt documents or tariff-related EBITDA addbacks.
- Unlike COVID, tariff impacts then did not widely trigger covenant changes or relief provisions.
Force Majeure Likely Excludes Tariffs
- Force majeure clauses in EBITDA adjustments often list specific events before a catch-all phrase.
- The Latin doctrine ejusdem generis likely excludes tariffs from catch-all unless specifically listed.