Protegrity Advisors

Advance DiligenceTM

Being prepared for planned or unplanned due diligence events is critical to maximizing valuation, minimizing any escrow or payment hold back, and instilling confidence in a seller's management team by the buyer or investor. Being unprepared can lead not only to lower valuation and higher escrow; it can also be a major distraction for management teams. For example, a rush to organize historical documents and deal with known or unknown skeletons can also have an adverse effect on revenue and profitability, can negatively impact the ability to keep the exercise confidential, and can lengthen the diligence period, thereby reducing the chances that the deal will close. When companies have multiple or international office locations, the risks associated with being unprepared are even greater.

Protegrity helps business owners make sure they are prepared when it really counts so their years of hard work are not wasted by dropping the ball just when they get to the goal line.

"Advance Diligence" from Protegrity can address possible problems before a potential selling company is under the magnifying glass of the buyer and its team of representatives and advisors. We bring an "outside" objective set of eyes to look at the company with the same perspective as potential buyers, allowing our clients to properly address issues well ahead of time.

Examples of items to be reviewed as part of Advance Diligence include:

  • Corporate history, minutes, by-laws, shareholder or operating agreements, votes necessary to effectuate a sale or round of financing (along with any special requirements)
  • Customer concentration risks
  • Key financial indicators, trends and forecasts
  • Organizational charts and structure
  • Material agreements and terms with customers, partners, vendors, and key employees
  • Standard company template agreements
  • Patent and trademark portfolio and assignments
  • Actual or potential litigation
  • Compensation and sales commission plans
  • Current and future insurance needs

Because Protegrity maintains an international network of experienced professionals with M&A, legal, accounting, human resources, technology, and sales and marketing expertise, we are in a position to act as a single vendor and provide a complete diligence report that objectively highlights issues along with recommendations for corrective measures and suggestions for enhancements. We can also proactively work with clients to execute on these recommendations with the objective of achieving a higher valuation.

Additionally, we offer the option of creating and keeping current an online due diligence portal that will enable an actual future due diligence event to be quickly and effectively conducted online.