Size debt capacity using repayment source, covenant cushion, and downside headroom.
The ask Evan needs to recommend debt capacity while the CEO is anchored on the bank's highest quoted number. The walk keeps the answer tied to repayment source and downside survival instead of lender appetite. Debt capacity sequence Source -> Cushion -> Structure -> Fresh test A capacity answer is strong only when each step survives the next one. Shortcut Use the bank's maximum. A debt amount the business can live with after the model is wrong. Capacity is the lesser of lender appetite, downside coverage, covenant cushion, and strategic flexibility. 01 Source 02 Cushion 03 Structure Repayment source Start…
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