Revolver commitment fee calculation?
A company I am building a model for has a .5% annual commitment fee on the unused portion of a $700mm revolving credit facility. The maximum letter of credit capacity is $50mm. Assuming the company has an outstanding balance of 0 on the revolver, would the quarterly commitment fee be = to (.005(700-50))/4 due to the $50mm LOC capacity, or would it just be (.005(700))/4? Thanks.