How to Research a Company's Capital Structure and Debt Covenants from Public Filings

TL;DR

To research a company's capital structure and debt covenants, identify its debt instruments and legal borrowers, reconcile outstanding principal to the financial statements, then read the applicable credit agreements and amendments for covenant definitions, thresholds and testing dates. Keep borrowing capacity separate from debt, and management-reported compliance separate from your own calculations.

This tutorial uses Valyu DeepResearch to investigate Crocs, Inc. at 31 December 2024. The checked example distinguishes $1.390 billion of debt principal from a $1.0 billion revolving commitment, then follows two financial covenants back to their contractual clauses. These are historical disclosures, not current debt figures or a credit recommendation.

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MCP onboarding: Connect your agent to https://mcp.valyu.ai/mcp and follow the MCP setup guide.

What should a useful credit research brief contain?

Suppose a credit analyst is preparing a first-pass company review. Before discussing refinancing risk, they need answers to a few concrete questions: which entities owe the money, how much is outstanding, when does it mature, and what restricts the borrowers' actions?

The useful output is not a paragraph saying the company has manageable leverage. It is an instrument-level debt table, a borrower and guarantor summary, and a covenant table with links to the evidence. Those let the analyst decide which documents and calculations need closer review.

Capital structure includes equity as well as debt. This walkthrough concentrates on the debt and creditor-protection side. Crocs also discloses one class of common stock in Note 11 of its annual report; a complete valuation would additionally consider equity, other claims and the chosen valuation date. We are not constructing an enterprise-value calculation or a bankruptcy recovery waterfall.

Figure 1. Retrieval produces evidence for a reviewed credit brief. A source link does not establish covenant compliance or creditor recovery priority.

Step 1: fix the company, reporting date and document set

Our question is deliberately bounded: Crocs, Inc., CIK 1334036, with debt balances at 31 December 2024. The financial statements appear in the FY2024 Form 10-K. The revolving agreement is available in Exhibit A to the Sixth Amendment, dated 4 December 2024.

That distinction matters. A reporting date describes the balance-sheet snapshot; a filing date identifies when that document was submitted, not necessarily when every underlying figure first became public. The annual report was filed on 13 February 2025. Using it here is a retrospective review, not proof of what an investor could have known on 31 December 2024.

Ask Valyu to retain:

• The instrument and its legal borrower, with guarantees or collateral where evidenced.
• Outstanding principal, carrying amount, facility commitment and available capacity as separate fields.
• Maturity, measurement date and units.
• The applicable agreement version and amendments.
• Covenant thresholds, defined terms, testing dates and exceptions.
• Unretrieved documents or missing inputs as explicit gaps.

The last amendment's title alone is not enough. In this case, its Exhibit A contains the amended agreement, including the definitions and financial-covenant clauses. That is more useful than reconstructing the terms applicable to the selected reporting date from an older facility announcement.

Step 2: run the investigation with Valyu

Install the Python SDK with pip install valyu and set VALYU_API_KEY in your server environment. Keep the key out of source files and logs. The example uses Valyu's hosted research agent, so no separate model-provider key or SEC integration is required.

Save this as research_credit.py:

import sys
 
from valyu import Valyu
 
client = Valyu()
 
if len(sys.argv) > 1:
    task_id = sys.argv[1]
else:
    task = client.deepresearch.create(
        query=(
            "Research Crocs, Inc. (CIK 1334036) capital structure and debt covenants at "
            "December 31, 2024, using its FY2024 Form 10-K and the revolving credit "
            "agreement as amended on December 4, 2024. This is a historical disclosure "
            "review, not a current credit opinion or point-in-time backtest. Identify "
            "funded debt by instrument, maturity and amount basis; separate facility "
            "commitments and unused capacity. Explain the revolving facility's financial "
            "covenant thresholds and definitions, and distinguish management-reported "
            "compliance from an independently calculated test."
        ),
        mode="fast",
        urls=[
            "https://www.sec.gov/Archives/edgar/data/1334036/000133403625000009/crox-20241231.htm",
            "https://www.sec.gov/Archives/edgar/data/1334036/000133403624000168/sixthamendmentto2ndarcredi.htm",
        ],
        research_strategy=(
            "Read Note 10 Borrowings and Note 11 Equity in the 10-K, then Exhibit A to "
            "the December 4, 2024 Sixth Amendment, especially definitions and Sections "
            "8.2.14 and 8.2.15. Preserve borrower/guarantor identity, reporting date, "
            "source date, principal versus carrying amount, and commitment versus "
            "borrowing. Use operative documents, not superseded facility sizes or later "
            "2025 guarantor supplements. Check contractual EBITDA, funded debt, cash "
            "netting and measurement periods before explaining ratios. Do not calculate "
            "headroom or infer a legal priority waterfall. If a definition or provision "
            "was not retrieved, say so. Do not invent sources or fill gaps from memory."
        ),
        report_format=(
            "Return a concise research brief with: (1) a debt table with instrument, "
            "principal USD millions, maturity, security/guarantee evidence and source; "
            "(2) a separate facility availability reconciliation; (3) a covenant table "
            "with threshold, applicable period, contractual definition/measurement and "
            "exact source clause; (4) management-reported compliance and review "
            "limitations. Include short supporting quotations for material claims and "
            "numbered source citations. Separate source-checked facts from "
            "interpretations. Do not present proposed figures as verified or offer "
            "investment/legal advice."
        ),
        output_formats=["markdown"],
    )
    if not task.success or not task.deepresearch_id:
        raise RuntimeError("No task ID returned; inspect the submission before retrying")
    task_id = task.deepresearch_id
 
print("Save this task ID:", task_id, flush=True)
result = client.deepresearch.wait(task_id, poll_interval=5, max_wait_time=900)
if result.status != "completed":
    raise RuntimeError("Research has not completed")
print(result.output)

Run python research_credit.py to create one task. Save the task ID printed before polling. To resume an existing task, run python research_credit.py YOUR_SAVED_TASK_ID; that path does not create another investigation.

The two SEC URLs are research inputs to Valyu, not separate API calls your application makes. research_strategy guides the investigation and report_format describes the requested output. They are instructions, not guarantees that every source will be retrieved or every claim correctly interpreted.

Fast mode has a base price of 25 credits at the time of this test. The request enables no optional tools or file deliverables. Check current pricing before running. If creation is ambiguous or the client times out, inspect the saved task rather than submitting another paid request.

Step 3: reconcile the debt table before interpreting it

The fast-mode test completed on 27 October 2026. It returned a seven-entry source catalogue and identified the debt balances and revolving covenant clauses. The returned brief marked four catalogue entries as unrelated; we did not use those entries as evidence about Crocs. We checked the selected figures and clauses below against the original Crocs documents. The run did not establish an independently calculated compliance ratio or covenant headroom.

The following is the reviewed historical reference table, checked against Note 10, Borrowings, of the annual report. Amounts are USD millions of outstanding principal, not facility sizes or fair values:

Source: Crocs FY2024 Form 10-K, Note 10. The separate Asia revolving facility had no outstanding borrowings at this reporting date.

The four principal balances add to $1,390.0 million. The filing subtracts $40.661 million of unamortised issuance costs, leaving $1,349.339 million of long-term borrowings on the reported carrying basis. The current portion in that table is zero for 2024. A table that places $1,349.339 million beside the instrument principal values without explaining the adjustment is mixing bases.

Now reconcile the revolving facility separately:

At the displayed precision of USD 0.1 million, the arithmetic is 1,000.0 - 190.0 - 0.6 = 809.4. Do not treat these rounded components as a full-precision reconciliation. The commitment is a facility limit, not additional funded debt. Remaining capacity is not cash in the bank or an unconditional promise that future drawings can be made: the agreement still governs access.

This also explains why the original Term Loan B amount is not the year-end balance. Note 10 describes the original $2.0 billion facility and the February 2024 refinancing, but reports $500.0 million outstanding at year-end. Keep the transaction history without counting each refinancing as another live loan.

Step 4: attach covenants to the right agreement

A debt inventory is not yet a covenant analysis. Different facilities and indentures can impose different restrictions on different entities.

For the revolver, the December 2024 amended agreement names Crocs, Inc., Crocs Retail, LLC, Jibbitz, Inc., Colorado Footwear C.V. and Crocs Europe B.V. as borrowers, together with parties joined as borrowers under its terms. It separately identifies guarantors. The 10-K says revolving borrowings are secured by the borrowers' assets and guaranteed by certain other subsidiaries. Do not assume that every consolidated subsidiary is therefore a borrower or guarantor under every instrument.

The two financial maintenance tests appear in Sections 8.2.14 and 8.2.15 of Exhibit A to the Sixth Amendment:

Section 8.2.14 requires the ratio to be maintained “as of the last day of each fiscal quarter” and to be “not less than 3.00 to 1.00.” That is a recurring maintenance test, not simply a condition checked when new debt is incurred.

The leverage schedule changes over time. Its 2024 base limits are 3.75:1.00 for March, 3.50:1.00 for June, and 3.25:1.00 for September and thereafter. Section 8.2.15 also permits an elected increase to 4.00:1.00 for a qualifying transaction quarter and the following three quarters, subject to its conditions and a once-during-the-agreement limitation. Section 1.1 defines that Permitted Specified Transaction as a Permitted Acquisition with a contractually defined Total Cost of at least $100 million. Total Cost is not simply the headline cash purchase price. Record that exception; do not silently apply the headline base limit to every situation. This walkthrough does not establish whether a step-up election was available or exercised for the selected quarter.

Definitions are where a plausible-looking ratio can go wrong. Section 1.1 defines the maintenance Leverage Ratio using consolidated Indebtedness, while also defining separate net leverage measures for other purposes. Those are not interchangeable. The definition of Consolidated EBITDA includes specified adjustments and caps. Consolidated Interest Expense is also contractually defined, including a cash-interest basis and specified financing items.

The next action is to obtain the relevant inputs and any completed compliance certificate, not divide two convenient numbers from an earnings presentation. The attached certificate form is not itself the company's completed calculation.

Step 5: separate disclosed compliance from your conclusion

Crocs states in Note 10 that it was in compliance with the revolving agreement's financial covenants at 31 December 2024. The note separately reports compliance under the Term Loan B agreement and the notes.

That supports a precise statement: “The company reported compliance at the stated date.” It does not mean this tutorial independently recalculated the contractual ratios or established unused covenant headroom.

Before using a generated brief, check that:

• Each amount matches the selected reporting date, units and amount basis.
• Refinanced or repaid facilities have not been counted twice.
• Borrowers, guarantors and collateral are tied to the instrument being discussed.
• The covenant clause, definitions, schedule and exceptions belong to the applicable agreement version.
• A reported compliance statement is not relabelled as an independently verified calculation.
• Unknown inputs, inaccessible passages and interpretation questions remain visible.

Security and payment ranking also need separate treatment. Note 10 describes security for the term loan and revolver, and describes the notes' payment ranking and guarantees. Equal ranking in right of payment does not, by itself, establish identical collateral rights or recoveries. A complete priority analysis may require indentures, security documents, intercreditor arrangements and legal review.

The result is a better research handoff: a reconciled debt table, the relevant covenant clauses and a short list of unresolved questions. It is not an automatic credit approval, breach determination or substitute for legal advice.

How to adapt the workflow

Change the company, CIK, reporting date and seed documents. For a current investigation, start with the latest relevant filing and inspect subsequent financing announcements and amendments. For a historical review, preserve the document dates and say whether you are using information published after the balance-sheet date.

Use Search when your application needs individual filing passages and owns the research loop. Use DeepResearch for a completed multi-document investigation. Neither route removes the need to verify the source evidence.

For broader company research, see how to build a financial research agent. To try a ready-to-use interface, explore Valyu Finance.

FAQ

Where do you find a company's debt covenants in public filings?

Start with the borrowing note and liquidity discussion in its 10-K or 10-Q. Follow the exhibit index to the relevant credit agreement, indenture and amendments. The filing summarises the debt; the agreement supplies definitions, testing rules and exceptions.

Is a revolving credit facility's size the company's outstanding debt?

No. In this example, Crocs disclosed a $1.0 billion commitment, $190.0 million drawn and $0.6 million of letters of credit. Its disclosed remaining capacity was $809.4 million. Those are different measures.

Can I use adjusted EBITDA from an earnings release to calculate covenant headroom?

Not without reconciling it to the agreement's definitions and calculation rules. Contractual EBITDA, debt scope, interest expense, measurement periods and permitted adjustments can differ from reported or presentation measures.

Does this code call SEC directly?

No. It calls Valyu DeepResearch. The SEC URLs identify source documents for the investigation and subsequent review; there is no separate reader-facing SEC client or filing parser.

What happens if the research times out?

The remote task may still be running. Resume with the printed task ID instead of creating another task. If creation returned no ID, inspect the submission before retrying.

Can this determine whether a company is in breach?

Not from a summary or compliance statement alone. You need the operative documents, applicable definitions, required inputs and any relevant amendments or waivers. This walkthrough establishes a source-linked research process, not a legal determination.