Mergers and Acquisitions

DOCUMENTATION ROUND 1

Be prepared to invest the time to compile all the documentation necessary for a sale.
You’ll need to provide the following:

• Financial information

  • 3 years’ income statements and balance sheets
  • 3 years’ corporate tax returns

  Property information

  • Date of opening
  • Construction plans
  • Survey
  • List of all equipment
  • Description of any recent upgrades or improvements
  • For leased locations, copy of lease

• Operating information

  • 3 years’ POS reports
  • 3 years’ membership analysis reports (if applicable)
  • Copies of long-term contracts, including frachise and supply agreements
  • Details of any price changes*
  • Details of any active promotions/discounts*
    
    

  *Applicable to carwash, not gas station

ANALYSIS & ADJUSTMENTS

Once you’ve provided all of the above information, PetroCal will conduct an initial valuation.
We want to make sure you get credit for every dollar of cash flow, so we’ll look to you to provide information for adjustments to normalize the cash flow for the buyer including:

• • Items that were expensed, but should’ve been capitalized
  • Ensuring all non-recurring extraordinary expenses are accounted for
  • Ensuring any non-recurring business interruption events are accounted for
  • Ensuring any owner’s expenses or discretionary expenses that would cease after the closing are accounted for

• Please note: Although there’s a lot of paperwork to put together, assembling it is time well spent for this once-in-a-lifetime transaction. Having this information collected and organized will proactively minimize setbacks and prepare you for a successful sale. Plus, most of this paperwork just needs to be gathered versus created.

DOCUMENTATION ROUND 2

Once we’re in alignment on the valuation, we’ll request supporting financial documentation including but not limited to:

SUPPORTING FINANCIAL DOCUMENTATION

• • Business bank statements and bank reconciliations
  • Trial balances and general ledger
  • Utility bills
• • Tax bills and filings
  • Vendor bills and agreements from largest vendors/suppliers
  • Payroll reports

DOCUMENTATION ROUND 3

After a buyer is selected, there will be one additional round of documentation needed from you to complete due diligence and closing:

SUPPORTING FINANCIAL DOCUMENTATION

• • All corporate documents
  • All permits and licenses
  • Vendor and customer contracts
  • Employee handbooks, benefit plans and agreements
  • Insurance certificates and loss runs
  • Notices from governmental agencies
• • Injury logs
  • IP registrations
  • Litigations and compliance documentation
  • Phase I/Phase II ESAs
  • SDS sheets for all hazardous materials or chemicals in use
  • Summary of outstanding deferred maintenance items
  • And more…