easy · Private Equity & LBOs

In a Sources and Uses table, if the 'Total Uses' increase due to higher transaction legal fees, how does this typically impact the 'Sponsor Equity' line if debt capacity is already maximized?

1. Transaction fees have no impact on the cash equity requirement.
2. The Sponsor Equity check decreases to offset the fees.
3. The purchase price of the business automatically decreases.
4. The Sponsor Equity check increases dollar-for-dollar.

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