A Startup is the Founders’ baby - they dream it, created it and worked tirelessly to make it successful. Deciding it may be time to sell all or part is the easy part - acknowledging and addressing the financial and emotional issues can be challenging. Negotiating with potential buyers or investors is time intensive, to say the least. Positioning a business for a value maximizing transaction requires planning. What professionals need to be engaged? How do the parties come to a valuation? What is the profile of the likely investor or buyer? These are just some of the questions this webinar addresses. Part of the webinar series: BUSINESS LAW REVIEW- 2022 See more at https://www.financialpoise.com/webinars/

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attorneys, accountants, business owners and
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4. Disclaimer
The material in this webinar is for informational purposes only. It should not be considered
legal, financial or other professional advice. You should consult with an attorney or other
appropriate professional to determine what may be best for your individual needs. While
Financial Poise™ takes reasonable steps to ensure that information it publishes is accurate,
Financial Poise™ makes no guaranty in this regard.
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5. Meet the Faculty
MODERATOR:
Jason W. Rubin- Goldberg, Miller & Rubin, P.C.
PANELISTS:
Andy Chidester – Metolius Partners, Inc.
Domenic Rinaldi - Sun Acquisitions
Thomas J. Walsh, Jr. – Brody Wilkinson, P.C.
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6. About This Webinar: Selling a Business
A Startup is the Founders’ baby - they dream it, created it and worked tirelessly to make it successful.
Deciding it may be time to sell all or part is the easy part - acknowledging and addressing the financial and
emotional issues can be challenging.
Negotiating with potential buyers or investors is time intensive, to say the least. Positioning a business for
a value maximizing transaction requires planning. What professionals need to be engaged? How do the
parties come to a valuation? What is the profile of the likely investor or buyer? These are just some of the
questions this webinar addresses.
Each Financial Poise Webinar is delivered in Plain English, understandable to investors, business owners, and executives without
much background in these areas, yet is of primary value to attorneys, accountants, and other seasoned professionals. Each episode
brings you into engaging, sometimes humorous, conversations designed to entertain as it teaches. Each episode in the series is
designed to be viewed independently of the other episodes so that participants will enhance their knowledge of this area whether
they attend one, some, or all episodes.
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7. About This Series: Business Law Review 2022
While law school provides a great foundation, there are so many things it does not teach.
Looking to strengthen and condition your cross-disciplinary skills? Develop your flexibility by
increasing your familiarity with issues affecting a vast array of businesses? This series delves
into cutting edge issues in dynamic fields to help lawyers, business professionals, or anyone
interested in the law, with some specialized learning in seven distinct areas of law.
As with every Financial Poise Webinar, each episode is delivered in Plain English so that you
do not have to be a Business Law specialist to understand and benefit from them. And, as
with every Financial Poise Webinar, each episode brings you into engaging, sometimes
humorous, conversations designed to entertain as it teaches. Each episode in the series is
designed to be viewed independently of the other episodes so that participants will enhance
their knowledge of this area whether they attend one, some, or all episodes.
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8. Episodes in this Series
#1: Buying a Business- 101
Premiere date: 2/10/22
#2: Defending White Collar Crime-101
Premiere date: 6/9/22
#3: Immigration Law for Business-101
Premiere date: 10/06/22
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9. Episodes in this Series
#4: Selling a Business-101
Premiere date: 11/10/22
#5: Zoning & Land Use 101
Premiere date: 12/8/22
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10. Episode #4
Selling a Business
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11. Reasons for Selling
✓ Owner Retiring – burned out, health issues
Succession
No Succession
✓ Private Equity Cashout
✓ Partnership Dispute
✓ Distressed – Need to sell
✓ Capital Restraints on Business
✓ Unsolicited Favorable Offer

12. Sales Considerations
• Value
✓ How can you increase value (Discount Inventory)?
✓ Is there a season that presents the best price (Holiday retail sales)?
✓ What valuation method is appropriate (EBITDA, Gross Sales, IP, FF&E)
✓ Cap Ex – invest now or leave to buyer?

13. Sales Considerations
• Payment Form:
✓ All cash
✓ Finance sale (take back a lien on your “old” company)
✓ Earn out (get paid from future performance)
✓ Stock in Buyer’s existing company
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14. Sales Considerations
• Professionals – Who Do You Need:
✓ Will a lawyer, accountant or tax advisor generate value?
✓ Does a business broker make sense?
✓ How do I find the right buyer?
✓ What if I already think I know my buyer and have an offer?
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15. Identify Issues and Fix Them
• Prepare the Company - Perform “self” diligence to identify potential issues:
✓ Corporate records: are they in order and up to date?
✓ Taxes current (returns filed) at close (IRS, FTB, BOE, Payroll, etc.)?
✓ Benefit plans in place and fully funded (401(k) or pension liabilities)?
✓ Deferred maintenance: “wants” versus “needs” – good use of cash?
✓ Pending litigation
o Plaintiff – who gets proceeds awarded post-sale?
o Defendant – who pays costs / damages?
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16. Identify Issues and Fix Them
• More “self” diligence items:
✓ Lender transfer / assumption issues
o Personal assets pledged to lender? Release possible?
o Key Man provisions
✓ Guarantees that need releases?
✓ Pending litigation with material risk to the entity?
o Indemnification? D&O tail policy?
✓ Environmental Compliance
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17. Why Hire a Professional?
• Sale Price / Value dictates the type of selling professional:
✓ Business Brokers
✓ Investment Bankers
• Advantage of a selling professional:
✓ Access to buyer database – speed in vetting buyers
✓ Expertise – ability to assist in positioning company
✓ Confidentiality
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18. Types of Buyers
• Strategic
✓ Competitor seeking synergies, increased market share, additional product offerings
• Financial
✓ Platform – seeking to make money
✓ Want strong management and market share; ability to grow
✓ Add-on – increase product offerings / market reach / access your customers; unlikely
to keep upper management
✓ Turnaround – buying to “fix” and increase profitability
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19. The Buyer’s Perspective
• How does your business present to buyers?
• When you tell your story, what do they hear?
✓ Premium / best in class – sustainable OR fixer?
✓ Is there an identified Growth opportunity
o Why have you not exploited it?
✓ Strong market share?
o Customer concentration?
o Personal relationships with customers / vendors lost in sale?
✓ Great Location (for how long)
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20. The Buyer’s Perspective
• How are your Cap Ex needs viewed by buyers?
✓ Cap Ex required?
o Urgent needs?
o Price reduction equal to cost of deferred maintenance?
o Pro Forma Adjustment to historical EBITDA?
✓ Business is cash flow positive, so why is there deferred maintenance?
o Typical seller points to opportunities – this is what the buyer hears
o Does failing to “maintain” cause a deeper dive into the financials?
o Are other operations sub-standard or neglected?
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21. The Buyer’s Perspective
• How is your sale preparation viewed by buyers?
✓ Severance / employment contracts an asset or a liability?
o Locking in employees long term – help for continuity or hinder if buyer wants to
bring in his team?
o Keep key employees through process (Bonus for staying through close) a
benefit for buyer or just a cost to seller?
• Potential liabilities identified and addressed?
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22. The Traditional Sales Process
• The 9 Steps
✓ Prepare Teaser and Confidential Information Memorandum (NDA signed)
✓ Market to solicit interest
✓ Screen interested parties
✓ Term Sheet or LOI received, negotiated and executed
✓ Data Room Access & Supplemental Document Request List addressed
✓ Management meetings
✓ Definitive Agreement Negotiated & Signed (Step 1 of 2 step closing)
✓ Regulatory Approvals and Consents received (Step 2 of 2 step closing)
✓ Post-closing matters (e.g. true up of balance sheet, working capital)
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23. Sale Terms to Consider
• Debt service from operations – paying you with your own money?
✓ Remedy if payments are missed?
✓ Poor performance places purchase price at risk?
✓ Securitized?
• Equity retained with no control
✓ Watch value decline
✓ Board Seat
✓ Right to take over if covenants are breached
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24. Sale Terms to Consider
• Valuation
✓ % Gross Sales (44%?)
o Does this make sense for the value components of your business?
o IP & PP&E not reflected?
✓ EBITDA Multiple (5x-9x?)
o Common, but representative of your situation?
o Multiple varies significantly by the opportunity / industry
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25. Letter of Intent
• Key Terms
✓ Price
✓ Exclusivity / Stand Still
✓ Assets Acquired
✓ Liabilities Assumed
✓ Remaining Diligence
✓ Timing
✓ Contingencies
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26. Lessons Learned
• Sale Process Tips:
✓ Don’t stop running your business / Operate in ordinary course
o Production or Sales declines will impact price
o Cease advertising and lose the sale – and future cash flow
✓ Don’t assume the sale will close per LOI / prepare for re-trade
✓ Must the founder stay through a transition period (key to the business?)
o How Long? Paid? Part Time? Non-Compete?
✓ Align your interests with the selling team
✓ $1MM price increase = $50K to broker and $950K to you
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27. Lessons Learned
• Sale Process Tips (con’t):
✓ Reps and Warranties matter
✓ Documentation – read it
✓ Review employee files
✓ Non-compete – what is reasonable
✓ Guarantee releases & replacement
✓ Assume financing?
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28. Lessons Learned
• Sticky Situations
✓ Post-closing Liabilities
o Holdbacks
o Indemnification
o Walk Away
✓ Ongoing Litigation
o Who pays costs / receives proceeds / pays damages
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29. About the Faculty
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30. About The Faculty
Jason W. Rubin- JRubin@gmrlawfirm.com
Jason W. Rubin, a Goldberg, Miller & Rubin partner, concentrates his practice in products liability
and toxic torts and has managed the firm’s well-regarded mass tort department for two decades.
Jason represents several clients in their toxic tort matters filed in Pennsylvania, New Jersey, and
New York and has tried several cases to verdict. His success has been recognized by Thomas
Reuters which has designated him a Super Lawyer in products liability every year since 2016.
Jason devotes a portion of his practice to mediation, arbitration, and pro bono service. He regularly
serves as a Judge Pro Tempore for the Philadelphia Court of Common Pleas Civil Trial Division
and volunteers with the Philadelphia Bar’s Fee Dispute Program as well.
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31. About The Faculty
Andy Chidester- Achidester@metoliuspartnersinc.com
Andy Chidester has more than 20 years of investment banking and corporate finance expertise in
industrial manufacturing, distribution, building products, and business services. He was previously
Managing Director with Matrix Capital Markets Group and Duff & Phelps, Inc., all in Chicago, Illinois.
He obtained his Bachelor of Arts degree in Economics and Music from Carleton College, an MBA from the
Kellogg Graduate School of Management at Northwestern University, and a Master of Science in
Accounting from DePaul University. He is a Certified Public Accountant and holds the FINRA General
Securities Representative (Series 7), FINRA Investment Banking Representative (Series 79), and Uniform
Securities Agent (Series 63) as a registered representative of Finalis Securities LLC Member
FINRA/SIPC.
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32. About The Faculty
Domenic Rinaldi - drinaldi@sunacquisitions.com
Domenic Rinaldi is the President and Managing Partner of Sun Acquisitions. He was awarded the professional
designation of Certified Business Intermediary from the International Business Brokers Association and is considered an
expert in the field of business brokerage. He is a seasoned executive who brings over 30 years of proven experience in
merger/acquisition, sales, service, marketing and operations to the business brokerage arena.
Domenic’s career began at Sprint Corp, where he spent 13 years in sales and operations. As VP of their Hospitality
Division he led a national organization to $250 million in annual revenue. His experience as Chief Operating Officer of an
e-commerce travel company offered the opportunity to grow a Silicon Valley startup into an international solutions
provider. Additionally, Domenic’s small business experience running a New York City technology company gave him first
hand knowledge of the challenges facing business owners. It was at this privately held company he learned the business
of raising venture capital and driving a small company to profitability, which ultimately resulted in an acquisition.
Domenic is recognized by colleagues and associates as a leader with determination and integrity. He has helped
countless business owners sell their businesses while maximizing value. Personally, he has served on the boards of
several non-profit organizations and started a citywide program serving under-privileged school children.
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33. About The Faculty
Thomas J. Walsh, Jr. - twalsh@brodywilk.com
THOMAS J. WALSH, JR. is a principal of Brody Wilkinson, P.C., and a member of the firm’s Business and Real
Estate Groups. His practice is focused primarily in the areas of general corporate matters, business
transactions, financing and commercial real estate. Mr. Walsh counsels clients – from entrepreneurial start-up
enterprises to larger privately held companies – through each phase of their growth serving as primary outside
counsel. He advises on issues such as the ideal form of organization, ownership and buy-sell agreements,
critical contracts with employees and third parties, debt and equity financing, and dispute resolution. Beyond the
start-up phase, Mr. Walsh also advises on business expansion opportunities, such as mergers and acquisitions,
marketing and licensing agreements, private equity and venture capital financing and joint ventures. He assists
clients with the business and legal aspects of negotiating transactions, enhancing business value and business
succession planning. Mr. Walsh is a Martindale-Hubbell AV-rated attorney and has been selected for inclusion in
The Best Lawyers of America© in the fields of real estate law, business organizations and corporate law.
To read more about Mr. Walsh, please visit: https://brodywilk.com/attorneys/thomas-j-walsh-jr/
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34. Questions or Comments?
If you have any questions about this webinar that you did not get to ask during the live
premiere, or if you are watching this webinar On Demand, please do not hesitate to email us
at info@financialpoise.com with any questions or comments you may have. Please include
the name of the webinar in your email and we will do our best to provide a timely response.
IMPORTANT NOTE: The material in this presentation is for general educational purposes
only. It has been prepared primarily for attorneys and accountants for use in the pursuit of
their continuing legal education and continuing professional education.
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