Our Advisory Service is broadly divided into three phases:
Phase 1 - Investor Readiness
Phase 2 - Offer Evaluation
Phase 3 - Transaction Closure, Compliance & Legal
Prior to approaching investors in the market, we have to ensure the preparation of our initial set of documents such as below:
Information Memorandum - Detailed summary of our proposition to the buyer, business model, brief about our organisation, team details, etc.
Financial Model / Business Valuation - This would be required to understand the expectation from the market and the deal structure / counter offer / projections that we will be proposing.
Business Analystt Report (https://analystt.ai/) - Comprehensive report to understand our current standing in the market, competition benchmarking, industry overview, pre due-diligence check points such as legal and tax, etc.
Understanding and decoding the buy-side offer and value proposition
Evaluation of the Term Sheet and Letter Of Intent to identify any unfavorable terms for the transaction and negotiate the same on behalf of you
In case of transaction using debt from the buy-side, evaluation of the structure (secured/unsecured) and source of funds prior to proceeding to the next stage
Preparation of counter offer and changes to the Term Sheet wherever applicable
Guidance and coordination with the buy side for a set of documents required for carrying out the Due -Diligence. This covers the Financial, Legal and technical Due - Diligence
Note: We can conduct a background check of the buyer on request to ensure the legitimacy of the party
Legal Advisory - Preparation, drafting, negotiating on legal documents, and advising on the necessary structure for successfully closing the transaction
Applicable / Legal Documents to be covered as part of the transaction:
Share Subscription Agreement
Any other related documentation for the transaction
Drafting and filing of Secretarial documents with the Registrar of Companies
Preparation of the certified valuation report as per Companies / Income Tax Act (whichever applicable) post confirmation of the deal value for PAS 3 filings and MGT 14 filings as per Companies Act, 2013
Please Note: If any of the above services are already being done inhouseby sell-side team, we can customize the scope for the services required.
Transaction Advisory - Legal
The legal advisory overlaps in the Phase 2 and Phase 3 both and in the below SOW we have explained the same in detail
We advise on the possible structures and help the client choose the best suited business structure and ensure that it is legally and financially kosher. We ensure that the structure chosen is agreeable to all the parties leading to a seamless closure of the transaction. The work involves negotiations with the opposite parties and strategic research.
Post finalising the structure, the buy-side issues a term sheet to which we work around for the chosen structure. The term sheet contains the terms of investment and/or association, we ensure that all the terms are favorable to the business requirements.
In an event we control the draft of the term sheet we draft it in a way which is in our favor at the same time also keep in mind that the terms are favorable to the Investor as well. We ideally prepare the term sheet post finalisation of the deal structure and other broader terms of the Investment.
Due - Diligence
A conducive due - diligence is conducted by the Investor team and we provide them with the necessary documents and assistance that they need to carry out the activity. After the due-diligence report is generated by the investor and point out any red flags, we then advise, negotiate and assist in removing the red flags highlighted.
A conducive non-disclosure agreement, exclusivity agreement and the term sheet forms part of the preliminary documents. A term sheet is Non-Binding in nature outlining the preliminary commercial understanding of the proposed transaction. Once the terms are agreed upon by both the parties is when the definitive agreements are drafted e.g Share Subscription Agreements &Shareholders Agreement.
In a fund raise transaction a share subscription agreement (for investment in new shares) and a shareholders’ agreement (setting out the inter se rights and obligations of shareholders) is entered into in cases where existing shareholders retain their shares or where two or more acquirers purchase a company. Further, where shareholders’ agreements are entered into, a company’s articles of association are amended to reflect the agreement’s terms
A host of ancillary documents may be required depending on the nature and type of transaction, including: employment agreements, transfer agreements concerning intellectual or real property, the novation or assignment of contracts, non-compete agreements with existing or existing shareholders. The commercials quoted includes all the above agreements i.e Terms Sheets, SSA, SHA and other filings related to the transaction.
Secretarial Compliances related to the fund raise transaction and applicable internal transfers which involves drafting and filing of secretarial documentations and relevant forms with the concerned authorities. The registered Valuer certification (Obtained from a registered Valuer) also forms part of the transactional compliance.
Promoter Employment Agreement to be entered between the founders and the company.
ESOP pool creation with formulation of ESOP Plan, ESOP Agreement and grant letter.
Note - These ‘Other Documentation’ isn’t covered in the Transaction Advisory from the legal standpoint
Why choose Kapso?
Our Experience - We have advised more than 1000 SMEs &Startups for preparation of their Business Plans during the fundraising process
Our Expert Advice & Recommendations - We shall not only assist you with the preparation of the Business Plan but also advise you on business model changes needed such that we pitch it right to investors
Our Highly Affordable Pricing - Our inhouse team of experts and advisors will help you in the preparation of a high-end pitch deck at very competitive pricing in the market
To understand what procedure we follow in formulating a business plan and how it may be beneficial for your company in specific, contact us at +91 80 80 171 171 or write to us at [email protected]