TRANSACTION PROCESS

Introduction

Business owners are encouraged to Contact Us directly to explore partnering with them to invest in and help grow their business. To see if Palingenix may be the right fit, please review our Approach and Investment Criteria. If there is mutual interest, we’ll move forward with an Initial Review.

 

Initial Review

Once we’ve confirmed that your business meets our investment criteria — and you’ve determined that Palingenix aligns with your objectives — we’ll execute a Confidentiality Agreement, allowing you to share the following information:

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• A summary of your goals (e.g., full sale, recapitalization, partial sale, management buyout, etc.)

• Three to five years of financial statements (P&L and balance sheet) and current budget 

• Three to five year summary of performance by top customers 

• Overview of ownership and owner-related benefits/annual compensation

• Additional information relevant to your business (for example, annual capital expenditures, financial forecasts, etc.)

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Following our review and follow-up discussion, we’ll re-confirm interest, issue a preliminary term sheet (known as an "Indication of Interest"), and schedule an on-site visit.

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Indication of Interest

An Indication of Interest ("IOI") is a document that outlines an initial partnership proposal to invest in your business. The IOI summarizes key deal terms such as:

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• Proposed valuation or purchase price range

• Transaction structure 

• Sources of capital 

• Next steps, including confirmatory diligence and a target timeline

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Importantly, an IOI is not a binding offer; it simply signals that we are serious about pursuing the partnership and want to move toward a more detailed, binding Letter of Intent ("LOI") pending further diligence.  ​

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Letter of Intent

After a successful visit, the process becomes more involved and formal. Additional information is exchanged, and additional site visits may take place. As Palingenix continues to learn about your business, and you learn more about us, further discussions regarding company valuation and transaction structure occur. The IOI may be revised during this stage and, eventually, lead to a formal LOI.

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A LOI is a formal, written document indicating the terms a buyer is offering a seller in a proposed partnership. A LOI states a serious intent, by both parties, to carry out the proposed transaction. Palingenix is very selective about issuing LOIs because they indicate that we will be dedicating substantial resources to invest in your business under the terms outlined in the LOI.

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Upon signing the LOI, Palingenix immediately engages an independent accounting firm to complete a Quality of Earnings (“QoE”) review. The QoE provides a clear, objective assessment of the company’s true earnings power, including revenue quality, expense normalization, cash flow, and working-capital requirements. This early deep dive creates alignment between all stakeholders, and serves as the foundation for the remainder of confirmatory diligence.

 

Confirmatory Diligence and Closing

Due diligence is a rigorous review of the business post-LOI and includes a detailed analysis of operating history and practices, customer and supplier references, management references and market reviews/analysis. During this period, Palingenix will also begin to underwrite a  value-creation strategy – anchored by an Onboarding Program and Growth Activation Plan – known as "The Palingenix Playbook". This playbook represents our framework for aligning strategy, deploying talent, grounding decisions in real-time data, harnessing AI, and engineering tomorrow’s exit from "Day One" onward to maximize shareholder value.

 

The due diligence process is managed by Palingenix with the assistance of third party advisers. Palingenix and its limited partners provide the equity capital to complete acquisitions, but we will also use some form of debt financing. The debt financing process includes identifying lenders interested in partnering with Palingenix to complete the acquisition. Palingenix maintains a large network of lenders that we can partner with to complete acquisitions.

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The final step in the acquisition process is the legal documentation and funding step. Upon completion of the legal process, the acquisition funds are wired to sellers and the partnership is complete. 

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Post-Closing Philosophy

At Palingenix, we do not issue press releases at the close of a transaction. While closing is an important milestone, we think of it as Opening Day—the start of a much longer journey.

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The baseball analogy is intentional. Opening Day brings excitement and optimism, but championships are not won on Day One. Our focus is on building enduring businesses that generate maximum shareholder value by the time an investment is ultimately realized. 

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We pursue this objective by partnering with strong companies, preserving what makes them exceptional, and deliberately positioning them for their next phase of growth. The businesses we exit are intentionally not the same as the businesses we acquire—and that transformation is the story we believe is worth telling.