Which investor wants to make 2% when US Treasury pays 5% so obviously creditors would want their money back or waant higher interest. If they ask the business for money back then the business has to sell business assets. When variable interest rate goes up by 1%, businesses that make 2% can’t even pay 2% as profit because interest takes additional 1%.
To give the creditors 1 additional percent , the business has to cut costs. Cutting costs means difficult decisions like closing under performing stores, cancelling projects and even layoffs in already slim workforce.