Issue: 33
JUNE 2015
Save the Date for the M&A Source Fall Conference!

Mark your calendars today for the 2015 M&A Source Fall Conference, which will be held at the Hyatt Regency in Albuquerque, New Mexico from November 9-12, 2015. More information is forthcoming, including courses to be offered as well as conference activities.

Be sure to visit our website for updates on the schedule and registration information.

Interested in participating in the M&A Source Dealmakers Expo? Contact .

In This Issue

Dreams, Knowledge and Work

Joe Lindsey, M&AMI, CBI


Do you remember the 1990 movie " Pretty Woman " starring Julia Roberts and Richard Gere?  If so, you may also remember that one of the many characters in that movie walked along the streets shouting "Everybody has a dream.  What's your dream?"


Let's assume that that movie character was correct in that all of us have had dreams at some time or another.  Some dreams die early deaths; others may linger unfulfilled; and still others become reality.  Let's see if we can determine what separates those three realities. 

Negotiating Contracts Between Intermediaries and Clients

Russell Robb


Most M&A contracts with Intermediaries and their clients appear to be innocuous, but often the devil is in the details.  We will address these details and show why they should be carefully considered before "carte blanche" acceptance.

As a general observation, beware of Intermediaries who have very lengthy engagement letters, e.g., over four pages long, and conversely beware of a potential client and/or the client's attorney that attempts to significantly rewrite the document.  It is highly recommended that the Intermediary spend the time to verbally go over the agreement before mailing or dropping it on the lap of the potential client as he walks out the door.  

Recapitalization: Have Your Cake and Eat it Too
Ron Stacey

A successful business owner nearing retirement faces a number of issues. Perhaps it is time to take some chips off the table, reduce personal exposure, attend more closely to the family, enjoy more leisure time and feel more secure. Wouldn't it be great if all of these objectives could be achieved while still retaining day-to-day control and a meaningful equity interest? And, get a trusted financial partner, reward a loyal management team with equity incentives, provide for the next generation, and get access to additional growth capital in the bargain. If all of this sounds like having your cake and eating it too, well, it is. The vehicle to reap these rewards is leveraged recapitalization.

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Editor's Desk

As Chair of the Communications Committee and Editor of the BRIDGE, I welcome your questions, comments, suggestions, letters to the Editor, etc.  Our goal is to provide content that is relevant to our readers.  Your feedback will help us achieve that goal.

Members of The M&A Source are encouraged to submit articles for publication.
Mike Camerota,  M&AMI,  CBI 

Using Representations and Warranties Insurance in Mid?-Market M&A Deals

Matt Heinz and Charles Fogden
Representations and warranties insurance can help facilitate the transaction process while offering business owners a strengthened bargaining position, favorable exit terms, and improved economics.


Multiple of EBITDA or SDE: A Car With or Without the Gas (and the Driver)
Darrell V. Arne, CBI, CPA, ASA


The basic formula to value a business is: Value = Earnings x Multiple


This is also the most commonly used "market method" business intermediaries use in determining the Most Probable Selling Price (MPSP) for a business that will be marketed for sale. It seems simple enough, but the MPSP is often miscalculated and therefore miscommunicated, because an incorrect level of earnings is applied against an incorrect multiple. The purpose of this article is to compare and contrast two levels of earnings, two types of market multiples and the resulting two and quite different - MPSPs. 

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Realistic Grasp of Market Value is Key to Selling Businesses

Frank E. Beane, CBI, CBA, ASA

In today's increasingly adversarial, litigious and complex business world, there are a growing number of circumstances where a private company should be professionally appraised before important economic decisions are made.


Such occasions may include taxation issues, estate planning, ESOP transactions, purchase or sale, property settlements and stockholder agreements. For purposes of this article the terms "appraisal" and "valuation" are considered interchangeable.

Welcome New 

M&A Source Members


Randy Bianchi

Frances Brunelle

Rick Carlson

J. Mark Jones

Clint Kurtz

Robert Marchand

Don Montgomery

Kevin Ramsier

Brian Stephens

Valerie Vaughn 

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About Us
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The association is organized and operated to promote members' professional development to better serve their clients' needs, and to maximize public awareness of services performed by intermediaries and ancillary advisors who facilitate solutions available for lower middle market merger and acquisition transactions. 

The M&A Source was established in 1991 to address the challenges faced by merger and acquisition professionals. This international organization currently has more than 250 M&A dealmakers including intermediaries, investment bankers, attorneys, accountants, financial planners and others involved in the M&A process.