Financial Statements

We support the process of preparing the financial statements (income statement and balance sheet).

Financial Due Diligence

Financial due diligence involves analyzing the target company’s financial statements to fully understand its finances and internal controls on how they are prepared.

Tax Due Diligence

Tax due diligence involves reviewing the target company’s tax returns and ensuring tax compliance.

Legal Due Diligence

Legal due diligence entails an in-depth investigation of the target company’s current and historical legal status. It involves evaluating legal structures, ownership, securities laws compliance, stockholder agreements, management, and its authorities to enter into the transaction. Material contracts, agreements, and obligations should go through a thorough review process to identify any potential liabilities. Examinations of intellectual property status, commercial rights, and any pending litigation are crucial in determining legal health.
If existing customer contracts are an integral part of the transaction, then we want to review the material customer contracts constituting a significant percentage of its revenue to determine the terms of the contracts and whether the counterparties have a right to terminate by convenience, whether these agreements contain any restrictive covenants, and whether consents from these counterparties are required.

Operational Due Diligence

When conducting operational due diligence, we examine how the target company runs on a day-to-day basis. Understanding the industry, systems, processes, and infrastructures, helps unearth strengths, flaws, and possible risks.

Team Due Diligence

Team due diligence involves checking that all workers are correctly classified as employees or independent consultants and that these individuals have executed assignment agreements assigning their rights to IP to the target companies. Acquirers would want to ensure that the target companies have complied with employment laws and that they understand the implications that the acquisition will have (i.e. whether such will be accelerated) on employee equity grants.

Prepare Teaser

We will prepare a teaser, which is a one-page, anonymous summary of the target company to garner interest from potential buyers before they sign an NDA.

Prepare CIM

We will prepare a Confidential Information Presentation (“CIM”). The CIP is a ~20 page document that provides buyers with an in-depth description of the target company.

Make Initial Contact with Buyers

We will make initial contact with buyers to share the teaser.

Execute NDAs and Send the CIP to Buyers

Once a buyer expresses interest, we send an NDA and the CIP to the buyer.

Qualify Buyers

We take time to qualify buyers to ensure they meet the minimum qualifications, such as interest level and financial capacity.

Management Presentations

We schedule 1-hour management presentations with you and qualified buyers to discuss a potential transaction and field questions.

First Round Bids

Buyers will submit their bids, which includes the proposed purchase price and basic details of a proposed transaction structure.

Data Room

After receiving first round bids, we will narrow the buyer list to 2-3 potential buyers. These buyers will have the opportunity to review additional information through a private data room.

2nd Round Management Meetings

We schedule 2-hour management meetings with you and buyers.

LOIs

Buyer make 2nd round bids in the form of LOIs.

Select a Buyer

At this point, we are ready to select a buyer and move to closing.

Finalize Diligence

The buyer will have 30-days of exclusivity where you agree to pause offers from other buyers. The buyer will use this exclusivity period to finalize due diligence and draft the purchase agreement.

Review Purchase Agreement

We will assist you in conducting final negotiations and reviewing the purchase agreement.

Close the Deal

The final step is to sign the purchase agreement, initiate wire transfers, and celebrate.