What is a Purchase and Sale Agreement (PSA)?
A purchase and sale agreement is the definitive legal contract that governs a business transaction, setting out every binding term, condition, representation, […]
What is Pre-Sale Due Diligence?
Pre-sale due diligence is the process of reviewing a business before a buyer does, to identify and resolve the issues that would […]
What is Normalized, Adjusted, or Recast EBITDA?
Normalized EBITDA is reported EBITDA adjusted to remove owner-specific costs, non-recurring items, and other distortions, producing the earnings figure that reflects what […]
What is Non-Solicitation and Non-Compete Clauses?
A non-compete clause prevents the seller from starting or joining a competing business for a defined period after closing; a non-solicitation clause […]
What is Management Continuity?
Management continuity is the assurance a buyer seeks that the key people running the business will remain in their roles after closing, […]
What is a Letter of Intent (LOI)?
A letter of intent is a non-binding document that outlines the key terms a buyer proposes for acquiring a business, the starting […]
What is an Information Memorandum (CIM)?
An information memorandum, also called a confidential information memorandum or CIM, is the formal document prepared by the seller to present the […]
What are Indemnities?
Indemnities are contractual obligations in a purchase and sale agreement that require the seller to compensate the buyer for specific losses arising […]
What is an Exclusivity Clause?
An exclusivity clause is a provision in a letter of intent that prevents the seller from soliciting or entertaining offers from other […]
What is Equity Rollover?
An equity rollover is an arrangement where the selling owner reinvests a portion of the sale proceeds into the acquiring entity, retaining […]
What is an Earnout?
An earnout is a deal structure where a portion of the purchase price is contingent on the business achieving defined performance targets […]
What is due diligence?
Due diligence is the formal investigation a buyer conducts into a business before completing a transaction, verifying that what was represented during […]