Decision: renegotiate structure
Summit Air HVAC clears base coverage at 1.64x, but a 10% revenue decline drops it to 1.02x.
Adjusted EBITDA of $732,400 on the trailing twelve months against an asking price of $2,950,000 — 4.03x. Every figure taken from the seller's records carries the page of the source bundle it came from, or is flagged as unsourced. Financing inputs are buyer and lender assumptions, labelled as such. Exports include a source-document manifest.
How these ratios are computed
Cash available for debt service = adjusted EBITDA $732,400 less maintenance capex $55,000 = $677,400. Annual debt service is $412,901 — the SBA loan only; the seller note is on full standby and carries no principal or interest during the term. Base DSCR is therefore 1.64x against a 1.20x lender test.
- Scenarios flex revenue only; operating expenses are held fixed, so a revenue change flows to earnings at the trailing-twelve-month gross margin of 45.8%.
- No tax provision, working-capital movement, or buyer distribution is deducted. A lender underwriting this deal would apply its own.
- Purchase price, capex, the covenant and the loan terms are buyer and lender assumptions — they do not come from the seller's source bundle.
Financing & Debt Service Model
Analyze sources and uses, covenant limits, and debt-service capacity across multiple scenarios.
Liquidity Covenant Breach DetectedMonth 3 (Sep 2026)
DSCR sensitivity
Domain-calculated coverage by approved scenario
View DSCR data table
| Scenario | DSCR | State |
|---|---|---|
| Base | 1.64x | Passes |
| Conservative | 1.33x | Passes |
| Downside | 1.02x | Below threshold |
| Severe | 0.39x | Below threshold |
Debt service
Scheduled payment composition by month
View debt-service data table
| Period | Payment | Principal | Interest |
|---|---|---|---|
| Month 1 | $34,408.42 | $12,095.92 | $22,312.50 |
| Month 2 | $34,408.42 | $12,201.76 | $22,206.66 |
| Month 3 | $34,408.42 | $12,308.52 | $22,099.90 |
| Month 4 | $34,408.42 | $12,416.22 | $21,992.20 |
| Month 5 | $34,408.42 | $12,524.87 | $21,883.55 |
| Month 6 | $34,408.42 | $12,634.46 | $21,773.96 |
| Month 7 | $34,408.42 | $12,745.01 | $21,663.41 |
| Month 8 | $34,408.42 | $12,856.53 | $21,551.89 |
| Month 9 | $34,408.42 | $12,969.02 | $21,439.40 |
| Month 10 | $34,408.42 | $13,082.50 | $21,325.92 |
| Month 11 | $34,408.42 | $13,196.97 | $21,211.45 |
| Month 12 | $34,408.42 | $13,312.45 | $21,095.97 |
Liquidity runway
Domain-projected ending cash across scenarios
View liquidity data table
| Scenario | Period | Ending cash |
|---|---|---|
| Base case (TTM held flat) | Month 1 | $336,154.08 |
| Base case (TTM held flat) | Month 2 | $375,130.66 |
| Base case (TTM held flat) | Month 3 | $399,994.74 |
| Base case (TTM held flat) | Month 4 | $416,391.32 |
| Base case (TTM held flat) | Month 5 | $427,142.90 |
| Base case (TTM held flat) | Month 6 | $435,071.98 |
| Base case (TTM held flat) | Month 7 | $445,823.56 |
| Base case (TTM held flat) | Month 8 | $450,930.14 |
| Base case (TTM held flat) | Month 9 | $464,504.22 |
| Base case (TTM held flat) | Month 10 | $486,545.80 |
| Base case (TTM held flat) | Month 11 | $517,054.88 |
| Base case (TTM held flat) | Month 12 | $564,498.96 |
| Conservative case (−5% revenue) | Month 1 | $322,752.00 |
| Conservative case (−5% revenue) | Month 2 | $347,790.41 |
| Conservative case (−5% revenue) | Month 3 | $361,396.74 |
| Conservative case (−5% revenue) | Month 4 | $368,143.82 |
| Conservative case (−5% revenue) | Month 5 | $370,318.07 |
| Conservative case (−5% revenue) | Month 6 | $370,205.90 |
| Conservative case (−5% revenue) | Month 7 | $372,380.15 |
| Conservative case (−5% revenue) | Month 8 | $369,981.56 |
| Conservative case (−5% revenue) | Month 9 | $374,442.22 |
| Conservative case (−5% revenue) | Month 10 | $385,762.13 |
| Conservative case (−5% revenue) | Month 11 | $403,941.29 |
| Conservative case (−5% revenue) | Month 12 | $435,838.95 |
| Downside case (−10% revenue) | Month 1 | $309,349.91 |
| Downside case (−10% revenue) | Month 2 | $320,450.16 |
| Downside case (−10% revenue) | Month 3 | $322,798.74 |
| Downside case (−10% revenue) | Month 4 | $319,896.32 |
| Downside case (−10% revenue) | Month 5 | $313,493.23 |
| Downside case (−10% revenue) | Month 6 | $305,339.81 |
| Downside case (−10% revenue) | Month 7 | $298,936.72 |
| Downside case (−10% revenue) | Month 8 | $289,032.97 |
| Downside case (−10% revenue) | Month 9 | $284,380.22 |
| Downside case (−10% revenue) | Month 10 | $284,978.47 |
| Downside case (−10% revenue) | Month 11 | $290,827.72 |
| Downside case (−10% revenue) | Month 12 | $307,178.97 |
| Severe downside case (−20% revenue) | Month 1 | $282,545.75 |
| Severe downside case (−20% revenue) | Month 2 | $265,769.66 |
| Severe downside case (−20% revenue) | Month 3 | $245,602.74 |
| Severe downside case (−20% revenue) | Month 4 | $223,401.32 |
| Severe downside case (−20% revenue) | Month 5 | $199,843.57 |
| Severe downside case (−20% revenue) | Month 6 | $175,607.65 |
| Severe downside case (−20% revenue) | Month 7 | $152,049.90 |
| Severe downside case (−20% revenue) | Month 8 | $127,135.81 |
| Severe downside case (−20% revenue) | Month 9 | $104,256.22 |
| Severe downside case (−20% revenue) | Month 10 | $83,411.13 |
| Severe downside case (−20% revenue) | Month 11 | $64,600.54 |
| Severe downside case (−20% revenue) | Month 12 | $49,858.95 |
Sources & Uses
Detailed overview of funding sources and allocation of proceeds for the acquisition.
| Source Label | Amount | Use Label | Amount |
|---|---|---|---|
| SBA 7(a) term loan | $2,550,000 | Purchase of business (enterprise value) | $2,950,000 |
| Seller note (subordinated, full standby) | $510,000 | Working capital cash at close | $300,000 |
| Buyer equity injection | $340,000 | Transaction fees & expenses | $85,000 |
| - | - | Financing fees | $65,000 |
| Total Sources | $3,400,000 | Total Uses | $3,400,000 |
SOP 50 10 8 Eligibility Checklist (Advisory)
Provide owner details to evaluate advisory SBA SOP eligibility flags. All outputs are advisory flags only and do not guarantee or enforce regulatory compliance.
SOP 50 10 8 Guidelines (Advisory Flags)
Pre-submission advisory checks based on SBA SOP 50 10 8. These are flags for review only and do not guarantee or enforce regulatory compliance.
Owner Eligibility Flags
Debt Service Coverage Ratio (DSCR) Scenarios
Analysis of DSCR across different operating scenarios. Typical lender requirement is ≥ 1.20x.
Base case (TTM held flat)
Conservative case (−5% revenue)
Downside case (−10% revenue)
Severe downside case (−20% revenue)
Illustrative acquisition-finance preparation only. This demo is not financing advice, not a lending decision, and not external verification.