Exit Planning Strategies

Whether you are interested in selling your business today, in two years or in five years, Paragon Equity Partners can assist you with developing a successful exit strategy from your privately held company, on your timetable, and on your terms and conditions.

Using our propriety process, the professionals at Paragon Equity Partners will work with you to develop a comprehensive road map that integrates financial, legal, tax, personal, and business issues involved in the sale, merger, or divestiture of your company.

Your Paragon professionals will assist you in the following seven areas to achieve your objectives:

1. Assisting you with development of your exit strategy objectives and goals.
2. Providing you with referrals of professionals, if necessary, to develop your exit strategy advisory team.
3. Determining your business' current value and Gap Analysis.
4. Identifying strategies to build and maintain your business' value.
5. Identifying succession and exit strategy options and results of actions taken.
6. Selecting the most appropriate exit route based upon your exit strategy objectives.
7. Executing the exit strategy.

• Maximizing your net proceeds at the time of your exit.
• Minimizing the taxes you have to pay upon exiting.
• Ensuring that the price and terms you receive meet or exceed your post-exit objectives.
• Making certain that your other non-financial objectives are met.
• Ensuring that you are advised and prepared to manage your post exit wealth.

Exit Planning Overview

Exit planning is a deliberate, thoughtful and flexible process that company owners use to leave the company on their terms and timetables. It is a comprehensive process tailored to your particular goals and objectives.

The principals at Paragon Equity Partners will help you ask the right questions to formulate and execute the most effective exit strategy to maximize the value received from your transition.

Start your plan now! Whether your objective is to maximize the capital gain from the sale, merger, or divestiture of your company interest, secure a comfortable retirement, maintain the viability of your company, ensure employment for the current work force, or pass ownership on to other family members, action to develop and implement your plan should start immediately. If your exit plan is not considered and managed in advance of need, it will be done in crisis mode with potentially devastating results.

Exit Strategy Objectives

It is vital to a successful exit strategy to time your exit. Receiving the best price and terms for your company interest often requires selling, merging, or divesting at the most opportune time. This means paying close attention to market and business conditions in your industry.

The financial advisors at Paragon Equity Partners will advise you regarding market conditions such as interest rates, merger and acquisition trends, and the availability of investment capital. The ownership and management of the company should be aware of the business conditions involving trends in the industry endemic to the company, which will increase or decrease its value.

We will assist you in developing your objectives by asking you the following initial questions:

• At what point in time do you want to exit from the company?
• Is the best new ownership for the company a strategic buyer, a financial buyer, a buyer group, an individual buyer, other shareholders, existing management or employees, or family members?
• When do you want liquidity from your investment in this company? D you want to invest in something else or invest in retirement?
• How much income do you need from the exit of this company to achieve your financial objectives?

Exit Advisory Team

It is important to build your exit advisory team early so that these experts can assist you with each component of your exit strategy objectives. If necessary, we can provide you with referrals for these experts. An accountant or attorney with a different area of expertise may be unprepared to provide you with the necessary advice to successfully implement a complex set of exit strategy objectives.

Your advisory team should be comprised of the following specialists:

• A Merger & Acquisition Advisor with expertise in mergers, acquisitions, and divestitures along with business appraising expertise.
• A Certified Public Accountant with expertise in transaction accounting.
• An attorney with expertise in transaction law and estate planning.
• A Certified Financial Planner with expertise in estate issues and legacy planning.

Business Valuation

The most critical step in planning an exit strategy from your company is determining your company's market value and how that value relates to your plans for exiting. The principals at Paragon Equity Partners are certified specialists in ascertaining the value of your business using traditional appraisal methods coupled with our extensive database of past transactions and other industry data. The appraisal process followed by Paragon advisors is well developed. This process will provide the ownership of a company with the critical path to the decision of whether or not their company is positioned to sell for its maximum value and whether that value will meet the Exit Strategy financial objectives.

Gap Analysis

If a gap exists between the current value of the company and the value necessary to reach the financial objectives to exit, then the value of the company needs to be improved.

Strategies to Build Value

After participating in hundreds of transactions during the past 25 years, the principals at Paragon Equity Partners have a deep knowledge of the key elements that all types of buyers look for in assessing the value of your company and determining its suitability as an acquisition or merger candidate.

Identify Exit Strategy Options

The principals at Paragon Equity Partners will assist you with identifying the most effective method to exit from your company based upon your exit strategy objectives. There are essentially five methods to exit from your company:

• Sale, merger, or divestiture to a strategic buyer (either public or private)
• Sale, merger, or divestiture to a financial buyer
• Sale to a buyer group or individual buyer
• Sale to other shareholders, senior management, key employees, or family members
• Liquidation or closure

Each of the strategies come with its own set of tax, estate, financial, and deal structuring implications. We can assist you with choosing the right approach to achieve your exit strategy objectives.

Execution of the Exit Strategy

Based upon the exit strategy selected, we will guide you through the merger and acquisition process. We will confidentially seek out suitable acquisition and/or merger candidates from our database of buyers, through our M&A affiliates around the world, and through traditional marketing channels. We will negotiate all of the transaction deal points, and we will work closely with accounting and legal counsel throughout the entire transaction process and through closing.