PPT 1 edited - FC LLC Divestitures in the Web Hosting World

The step by step process of selling your web hosting company.:

The step by step process of selling your web hosting company . Eric Furlow , President eric@furlowconsulting.com 850-982-8102 Skype: efurlow FURLOW CONSULTING MERGERS, ACQUISITIONS & VALUATIONS IN THE INTERNET INDUSTRY

The Divestiture Process:

The Divestiture Process 1) Create a Blind Overview FURLOW CONSULTING MERGERS, ACQUISITIONS & VALUATIONS IN THE INTERNET INDUSTRY 2) Send Blind Overview Out 3) Create Company Overview 4) Have Prospects Sign Seller’s NDA 5) Information Request, Conference Calls & Site Visits 6) Frequently Asked Questions “FAQ” Doc 7) Letter of Intent 8) Due Diligence and Purchase Agreement 9) Closing and Post Closing Issues

The Blind Overview:

The Blind Overview This is the 8-12 sentence description of the company but it doesn’t reveal who the company is . FURLOW CONSULTING MERGERS, ACQUISITIONS & VALUATIONS IN THE INTERNET INDUSTRY It Includes the basics: Location of owners, offices, employees, customers, servers/IDC Annualized Annual Revenue (how much recurring vs. one time revenue) Windows and/or Linux Product Mix: Shared, Dedicated, or Co-lo (or a combo) # of Customers in Each Product Category Which Control Panel and Billing System Owned vs. Leased Servers (3 rd party IDC?)

Send the Blind Overview Out :

Send the Blind Overview Out Our Weekly Internet Deal List FURLOW CONSULTING MERGERS, ACQUISITIONS & VALUATIONS IN THE INTERNET INDUSTRY Several of the top business brokerage web sites Several other brokers/bankers/consultants around the world Proactively Search for Logical Prospects

Create the Company Presentation:

Create the Company Presentation Company History & Overview FURLOW CONSULTING MERGERS, ACQUISITIONS & VALUATIONS IN THE INTERNET INDUSTRY Product and Service Focus Management & Employees Technical Financial

Prospects Sign Seller’s NDA :

Prospects Sign Seller’s NDA Before a prospect signs the Seller’s NDA, I communicate the prospect’s name with my client to get approval. FURLOW CONSULTING MERGERS, ACQUISITIONS & VALUATIONS IN THE INTERNET INDUSTRY Sellers like to control who is made aware of this process and who is not.

Information Request, Conference Calls & Site Visit:

Information Request, Conference Calls & Site Visit INFORMATION REQUEST FURLOW CONSULTING MERGERS, ACQUISITIONS & VALUATIONS IN THE INTERNET INDUSTRY CONFERENCE CALLS SITE VISIT

FAQ Document:

FAQ Document Buyer A has 3 questions …We get answers for them. Buyer B has 4 different questions ... We get answers for them. Buyer C has 2 different questions … We get answers for them. FURLOW CONSULTING MERGERS, ACQUISITIONS & VALUATIONS IN THE INTERNET INDUSTRY I get all of the Q&A from Buyer A,B, & C and put them into 1 FAQ document I then send the FAQ out to all of the prospects, even Buyer D,E,F etc.

Letter of Intent “LOI”:

Letter of Intent “LOI” The LOI describes the basics of the proposed deal. FURLOW CONSULTING MERGERS, ACQUISITIONS & VALUATIONS IN THE INTERNET INDUSTRY Stock or Asset Purchase Who the buyer and seller are. Specifically what is being acquired, and what is not. The terms of the sale are. Total Value (based on what formula) Amount paid at closing and over time, (based on what) The time frame until closing.

Due Diligence Period and the Purchase Agreement:

Due Diligence Period and the Purchase Agreement Both can and should occur simultaneously FURLOW CONSULTING MERGERS, ACQUISITIONS & VALUATIONS IN THE INTERNET INDUSTRY Both have to be completed prior to closing

Closing and Post Closing Issues:

Closing and Post Closing Issues Closing The Purchase Agreement is signed and the initial funds are wired. Legal ownership is transferred. FURLOW CONSULTING MERGERS, ACQUISITIONS & VALUATIONS IN THE INTERNET INDUSTRY Post Closing Issues In many cases there are performance terms spelled out in the purchase agreement.

Conclusion :

Conclusion Eric Furlow , President eric@furlowconsulting.com 850-982-8102 Skype: efurlow FURLOW CONSULTING MERGERS, ACQUISITIONS & VALUATIONS IN THE INTERNET INDUSTRY