EBITDA Positive but Bankrupt?

Capex isn't a one time chunk payment at year end. Regardless, assume it's maintenance capex because that makes it simpler

Plenty of reasons why you couldn’t refinance. At the end of the day someone has to be willing to loan you money in order to refinance, maybe it’s a crap business, maybe rather than the numbers I used it’s a more extreme amount of debt and it’s unlikely the company will be able to recover because it’s a crap business. Maybe they tried refinancing before or they just applied or tried to raise debt and were unsuccessful. Alternatively, it could be the business owners decide filing for chapter 11 (bankruptcy) is the easiest way for the company to start fresh or recover rather than refinancing at an unfavorable rate.

Just adding to this—an also great point you brought up that is very relevant to today. Generally, when times are good and people perceive little risk and borrowing costs are low it is very easy to refinance.(low rates, and a tight credit spread). When times are less stable, generally credit spreads will widen, also historically borrowing has had much higher standards. The United States has been operating with low rates and pretty tight credit spreads for some time now largely due to the fed cutting rates for the last few decades and the lack of a recession making people behave as though risk isn’t real. If you want a better lesson on credit spreads and low rates look at Japan and you can learn about “zombie companies” and what happens when a company has so much debt that they can only pay off interest and not the principal due to having too many or too harsh loans.

Historically, generally rates were much higher, credit spreads wider, and the bar for loaning was much higher, so more people would try to get debt and they would be unable. You see that less today, but it still does happen where refinancing isn’t always an option.