ACP newsagent presentation

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Doing the unthinkable
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What is Business Coaching?

• Youre an expert in your business
• Were experts on business
• We use simple models and guides
• To help you to develop your own solutions
• We stay with you to guide implementation
• For as long as you need

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Agenda
What does Succession mean to you?
Succession is derived from Success
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What does success look like in your business?
How are you going to get out in a way that works?
Short term
More profit
Fix IT
Time out
Less stress
Work on the business
Family time
Delegate
Staff responsibility
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How to get out?

• Sell externally
• Merger
• Go public
• Private equity
• Internal Succession
• Die with your boots on

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Impact of your decision
Merger Compromise, share decisions. ½ costs same
revenue. Creates uncertainty Complimentary
skills, grow quickly
Sell externally Competitors, dealing with the
enemy Pinch ideas Unresolved Get cash move quickly
Go public Compliance Corporate lots of
thinking Principal takes focus off business Lots
of money and publicity
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Cont
Private equity Control Vulture Capitalist own
40 Your business is now an object Money to grow
Internal Succession Confidence Low on due
diligence How to finance E.E.C. Transitional Have
control over look and feel of business
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What do I need to do this?
Offer
Energy
Discount
Account/ Legal
Why
Expectations
Bus Model
Values
Accounts
Criteria
Criteria
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Who do I need to do this?
Business valuation
Legal
Tax issues
Brokers
A plan.
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What do I need to do this?
Functionality - right person right role.
Distribution - where your clients come from.
Positioning - why your clients come to you.
Shirlaws
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Now what?
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The Legal Bit

• Sell externally Contract of Sale
• Merger Marriage Agreement
• Go public Prospectus
• Private equity Marriage Agreement
• Internal Succession Marriage Agreement
• Die with boots on Buy/Sell Agreement

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Why Have A Marriage Agreement?

• Smooth Succession
• Ability to realise the business asset
• Certainty
• Protection of minority stakeholders
• Protection of continuing parties and Estates
• Keeping the Courts out of it

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Who Are They For?

• Any Business Marriage.

• Partnerships
• Shareholders
• Unitholders
• Joint Venturers

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Whats In Them?

• The framework for transition by agreement
• Voluntary Sale
• Involuntary Sale
• Deadlock
• Death, Total Permanent Disability (TPD) Trauma

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Voluntary

• The Most Common Model
• Right of First Refusal
• Selling party nominates interest and price
• Independent valuation where there is dispute
• A period to take up by existing owners
• Thereafter free to sell to third parties

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Involuntary

• A basic model

• One or more of a list of indiscretions breached
• Independent valuation
• Can be controversial

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Deadlock

• Two basic models

• Tender Offer
• Toss of the Coin

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Some Other Concepts

• Pre-determined value levels
• Shot Gun
• Tag Along Rights
• Drag Along Rights

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Death, TPD Trauma
The Insurable Events

• Put Option by outgoing owner/estate
• Call Option by continuing owner(s)
• Tax Position

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• Questions and Discussion
• Thank you for coming