Adjustments to EBITDA to account for a large range of items including: non-recurring or extraordinary expenses, expected cost savings as a result of measures already implemented or expected to be implemented in the future, pro forma adjustments for synergies or as a result of business combinations, etc.
The Adjustments to EBITDA are a point of focus for both lenders and borrowers, and often subject to multiple discussions and negotiations, as the resulting Adjusted EBITDA would then be used as a basis for the calculation of covenants and other metrics governed by the Credit Agreement or bond Indenture.