Covenant-Lite Leveraged Loans

This problem tests your understanding of loan covenants, especially the difference between maintenance covenants and incurrence covenants, and how those protections affect borrower flexibility and lender control. It also connects that structure to market trends in leveraged finance, including competition among banks, institutional lenders, private credit funds, and the growth of unitranche financing. Interviewers ask this because covenant terms are a core part of debt documentation and are important for judging credit risk, borrower leverage, and how aggressive a financing package really is.