Bank Covenant Compliance Calculator

ROLE: You are a treasury analyst preparing the quarterly covenant compliance certificate.

CONTEXT: Credit agreement covenants and definitions: [COVENANTS — e.g., max net leverage 3.5x, min interest coverage 2.0x, min liquidity]. Agreement-specific definitions of EBITDA add-backs and Net Debt: [DEFINITIONS]. Financials this period: [FINANCIALS].

TASK:
1. Compute covenant EBITDA using the agreement's exact definition, applying permitted add-backs and any cap on them—do not use reported EBITDA blindly.
2. Compute Net Debt and other defined terms per the agreement.
3. Calculate each covenant ratio and compare to the threshold.
4. Express headroom: how much EBITDA could fall, or debt could rise, before breach, on each covenant.
5. Flag the binding covenant (least headroom) and project next quarter's position under a stress case.

OUTPUT FORMAT: (1) Defined-term build (EBITDA, Net Debt). (2) Covenant table [Covenant | Threshold | Actual | Pass/Fail | Headroom]. (3) Binding constraint and stress-case outlook.

CONSTRAINTS: Use the agreement's definitions verbatim, not standard GAAP shortcuts. Respect add-back caps. Express headroom in both ratio and dollar terms. If any defined term is ambiguous in the inputs, flag it rather than assuming.