An exclusivity (no-shop) requirement is a provision in a contract or agreement that prohibits one party from engaging in discussions, negotiations, or transactions with other parties for a specified period of time. It ensures that the party benefiting from exclusivity has the exclusive right or opportunity to pursue a particular business transaction without competition or interference.
In the context of a business acquisition or merger, an exclusivity requirement may be included in a letter of intent (LOI) or a term sheet to provide the prospective buyer with a designated period to conduct due diligence, negotiate the terms of the transaction, and secure financing without the target company seeking or entertaining alternative offers from other potential buyers.
By agreeing to an exclusivity requirement, the seller or target company commits to refraining from actively soliciting or entertaining offers from other parties during the specified exclusivity period. It provides the buyer with a level of assurance and time to complete the necessary steps for finalizing the transaction.
The purpose of an exclusivity requirement is to give the buyer a reasonable opportunity to assess the business, negotiate terms, and invest resources in the transaction without the risk of competing bidders or last-minute changes. It can be a valuable tool in maintaining confidentiality, streamlining the transaction process, and increasing the likelihood of a successful deal. However, it’s essential for both parties to carefully consider the terms and duration of exclusivity to ensure fairness and alignment with their respective interests.
EBITDA stands for “Earnings Before Interest, Taxes, Depreciation, and Amortization.” It is a financial metric used to assess a company’s operating performance and profitability. EBITDA represents the company’s earnings or profits before deducting interest expenses, income taxes, depreciation, and amortization expenses.
EBITDA provides a clearer picture of a company’s operational profitability by excluding non-operating factors such as interest and tax expenses, as well as accounting practices like depreciation and amortization, which can vary between companies based on their capital structure and accounting methods.
EBITDA is often used as a measure of a company’s cash generation potential and its ability to generate profits from core operations. It is widely employed in financial analysis, valuation, and comparisons between companies, especially in industries where capital expenditures, debt levels, and tax considerations vary significantly.
It’s important to note that while EBITDA is a useful metric for evaluating operational performance, it does not account for certain important factors such as capital expenditures, working capital changes, or the impact of non-cash expenses. Therefore, it should be used in conjunction with other financial measures and considerations when analyzing a company’s overall financial health.
TTM stands for “Trailing Twelve Months.” It is a financial metric used to measure a company’s performance over the past twelve consecutive months. TTM data includes the most recent four quarters of financial results, providing a snapshot of the company’s performance during that period. It allows for a more up-to-date and comprehensive analysis of a company’s financial health and trends compared to annual or quarterly reports alone. TTM figures are commonly used in financial analysis, valuation, and comparisons between companies.
Seller’s Discretionary Earnings (SDE) is a financial metric used to evaluate the earnings potential of a business. It represents the total cash flow generated by a business, taking into account the owner’s salary, perks, and discretionary expenses that may not be essential for the business’s ongoing operations. SDE provides a more comprehensive picture of the business’s profitability by factoring in the owner’s financial benefits that might not be reflected in traditional financial statements. It is commonly used in business valuation and acquisition processes to estimate the income that a new owner could potentially derive from the business.
Yes we have sold many Amazon FBA businesses over the years. Click here to get a free online business valuation.
Our goal is to have the valuation completed in less than 24 hours once we receive all the requested information. Sometimes the valuation process can take longer than 24 hours if additional industry research needs to be completed or the business has a valuation above $5MM +. Our goal is to provide the most accurate valuation possible on your business.
Acquisitions Direct was founded in 2002 and has been successfully selling online businesses since inception.
We pride ourselves on providing our clients with a high-quality, custom sales process. A substantial amount of work goes into the sales presentation and marketing plan to sell a business. This type of service is typically not cost effective for businesses priced under $100,000, and our buyers are generally looking for businesses that will have annual profits higher than those that would fall under that threshold.
Here is a list of our most recent transactions. We have sold businesses ranging in price from $100,000 to over $15,000,000+. Recently Sold Online Businesses
Acquisitions Direct is a technology-based lead generation sales platform that has become a leader in the online brokering space with experience across all industries and business verticals. The following are just a few of the industries that Acquisitions Direct has served:
Ecommerce Business
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Technology and Service Businesses
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Our knowledge of the marketplace demands and our experience enable us to promote high quality listings and businesses with potential. We do not take every listing that approaches us to sell. We advise our clients to make sure their business is ready for a buyer. Our selection process, coupled with our experience, help us maintain our high closing percentage.
Yes please contact us and we will be happy to discuss our referral program with you. This program is subject to the execution of a referral confirmation agreement between the referring party and Acquisitions Direct. Participation in this program has certain restrictions which will be discussed with the referring party. All referrals that list with Acquisitions Direct are sold by Acquisitions Direct receive a referral fee at time of closing.
We will occasionally co-broker with select highly qualified brokers on specific listings. Please contact us for more information.
An escrow company should be used for all transactions with the exception of those closings handled by the buyer’s lender. Using a third party to handle escrowing buyer funds and conducting the close protects both buyer and seller. When using an escrow company the seller knows they will receive funds upon transferring the business over to the buyer and the buyer knows upon the transfer of funds they will receive ownership to the business they are purchasing.
The due diligence process usually takes from 2 to 4 weeks. The amount of effort and detail involved in the buyer’s review is driven by the complexity of the business and the dollar amount of the transaction.
Yes, please fill out the contact us form here and and give us the parameters of businesses you may have interest in. Parameters include industry, approximate range of listing price, SBA financeable, etc. When listings that meet your criteria become available you will be contacted.
We generally need a three year high level profit and loss statement as well and current year to date financial results. In addition a list of your domains, and a few operational as well as competitive related questions. This information should not take you more than about 30 minutes to develop.
The average business sells within 4-5 months. This will vary by industry. We have seen businesses sell in as quick as 2 weeks to well over a year. For more information on our sales process please check out our 10 Step Sales Process here.
Every buyer should perform a complete due diligence on any business they will potentially purchase. The due diligence process should include a review of merchant account statements, bank statements, supplier costs as well as tax returns. The key is to trace the cash from the merchant account to the P&L. Your CPA will help you develop an effective review process.
Due to the amount of time it takes to procure a buyer and move each business through the sales process, we cannot accept a shorter contract length than 6 months. For more information on our sales process please check out our 10 Step Sales Process here.
Buyers are looking to validate the accuracy of all significant information provided. This validation will typically include a review of merchant account statements, bank statements, a statistically sampling of supplier invoices, tax returns, 1099 and W-2 statements, supplier contracts, credit card statements for business expenses, etc.
It usually depends on the desire of the buyer. The larger the price of the transaction the more likely it is that a face to face meeting will take place prior to the closing. Generally most interaction between buyer and seller is via conference call and email communication. The broker will facilitate all such communication.
Acquisitions Direct is totally performance based. We are only paid when we sell your business at the asking price, or at a lower price if you choose to accept it. There are no upfront fees charged for our services.
This depends on the complexity of the business and the industry. Our brokers will only schedule conference calls with qualified buyers.
Most sellers will require a seller financing of 10 to 20% of the transaction price. We strive to obtain as much cash at close as possible to the seller.
It depends on the financial history of the business as well as the financial strength of the buyer. Generally if the business has consistent, ideally growing sales and profitability for the last three years and the buyer has a decent FICO score then there is a strong likelihood SBA financing can be obtained. It does however depend on the specific SBA Preferred Lender used by the buyer.
No, we do not accept all listings. Some brokers will take all listings but strategically Acquisitions Direct will only take quality listings. We do however take distressed listings from time to time where that distressed business appears to have potential to be turned around by the right buyer. Our firm is noted for offering quality businesses which is substantiated by our high close rate.
The price determined for what to list your business for is calculated during the business valuation process. There are multiple factors that go into driving the valuation with the major ones being revenue & profit history, current year financials, specific industry focus, anticipated market demand for that business, and current business infrastructure in place including weekly effort required for new owner to effectively manage this business. Click here to get a free valuation.
The average business sells within 4-5 months. This will vary by industry and current state of the business (profitability and growth trends)