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- Employee Stock Ownership Plans
- Minority Interest Purchase
- Buy-Sell Agreements
- Warrants and Options
- Convertible Securities
- Acquisitions, Mergers and Divestitures
- “Going Private” Transactions
- Premiums for Control Positions
- Leverage Buyouts
- Stock Repurchases
- Estate, Gift and Income Tax
- Sale/Purchase Price Allocation
- Recapitalizations and Reorganizations
- Intangible Asset Valuation
- Expert Witness Testimony
- Valuation Opinions
- Business Damages
- Bankruptcy Proceedings
- Merger/Acquisition Analysis
- Structuring Stock Repurchases
- Dividend Policy Analysis
- Build or Buy Analysis
- Project Finance Services
Closely-Held Company Valuations
Sale Price Analysis
Fairness Opinions
Tax Related Valuations
Litigation Support
Financial Advisory Services
Compensation For Financial Advisory Services
HARTFORD CAPITAL’s compensation for valuation services is structured on a fixed fee basis. All fee arrangements are specifically designed to reflect the client’s needs and are formally agreed to by all parties at the onset of an engagement.
In addition, engagement fees in the form of monthly retainers for financial advisory assignments, valuations or fairness opinions may be required.
HARTFORD CAPITAL invites potential clients to discuss their particular needs without incurring a fee for an initial meeting.
HARTFORD CAPITAL is dedicated to providing a broad range of financial advisory services to middle market companies. HARTFORD CAPITAL offers its services for raising capital in the private markets and advising on raising capital in the public markets. When retained, as either an agent or an advisor, HARTFORD CAPITAL:
Determines an appropriate financing structure;
- Prepares a financing memorandum;
- Recommends an optimal timetable;
- Identifies prospective lenders;
- Markets the financing;
- Negotiates the terms and conditions;
- Coordinates the documentation; and
- Facilitates the closing.
Leverage buyouts and private placements of taxable and tax-exempt debt and equity securities are the areas in which HARTFORD CAPITAL is the most active. Other areas include corporate acquisitions, rights offerings and Employee Stock Ownership Plans. In recent years, HARTFORD CAPITAL has assisted its clients in transactions that have generally ranged in size from $5 million to $150 million. In each instance HARTFORD CAPITAL has arranged financing, which is competitively priced and properly structured to accommodate the client’s requirements for future growth.
Leverage Buyouts
In a leveraged buyout, the acquirer, usually a management or investor group, uses the assets and cash flow of the acquired company to support and service the debt incurred in acquiring the company. An objective of the buyout group is to contribute the minimum amount of equity necessary to complete the transaction. HARTFORD CAPITAL aggressively seeks to meet this objective through expertise gained as agent for the financing of other highly leveraged transactions.
The key variables in a leveraged buyout are the value of the assets, the magnitude of the cash flow, on both a historical and projected basis, and the quality of the management. Weakness in any one of these areas does not necessarily preclude the possibility of financing a particular buyout. However, it does highlight the necessity of approaching potential lenders with a comprehensive financing memorandum, which emphasizes the client’s strengths and includes plans for overcoming any perceived weaknesses. With input from the client HARTFORD CAPITAL tailors the financing memorandum to address questions that potential lenders ask in reviewing the transaction.
The potential lenders for a leveraged buyout include commercial banks, commercial financial companies, insurance companies, venture capital firms and leverage buyout funds. Some or all of them can provide financing in the form of senior debt (revolving credit and term loans), subordinated debt with and without warrants, and preferred and/or common stock. By maintaining contacts with a large number of potential lenders HARTFORD CAPITAL knows which ones will be comfortable with a particular industry or situation and therefore, offer the most attractive terms and conditions for financing the buyout.
Project Finance
Hartsfield also operates as a "Forfaiting Company" in the Global Trade & Project Finance Markets. Accordingly, the firm specializes in offering Forfaiting Services to corporate clients under Bank guarantee or aval in countries that meet the risk criteria.
HARTFORD uses its own funds and facilities arranged from International Banks and Financial Institutions. HARTFORD offers deferred payment terms by the discounting of trade documents under the guarantee or aval of internationally recognized Banks:
- Letters of Credit
- Letters of Guarantee
- Bills of Exchange
- Avaled Promissory Notes
Deferred Terms will depend on the individual transaction details and the Bank/Country Risk.
Structured Loans and Project Finance can be arranged and are dependent on particular transaction circumstances.
Major infrastructure or commercial projects can be funded by the arranging of Loans from major International Banks and Financial Institutions.
It is normal in these cases for the funding of the project to be supported by Treasury and/or Bank guarantees.
Funding and pricing of these transactions depends upon:
- Country Risk.
- Availability of Bank Guarantee.
- Bank Risk.
- Corporate Risk.
- Industrial Sector Risk.
- Use of Funds.
- Term of Funding.
- Currency used in the Funding.
Format and Documentation is dependent on specific terms and conditions of the particular Project.
Securitized loans can be arranged where export revenues can be identified and are supported by contracts from international corporations. An example of this could be "blue chip" leases.
Corporate financial advisory services are intended to provide corporate clients with an organized approach to the solution of financially related problems and policies.
In this regard HARTFORD CAPITAL functions as “financial engineers”, by preparing studies and developing solutions for a wide variety of corporate finance situations including:
- Preparing capital studies for board review and presentation to regulatory agencies;
- Advising on financial strategies to defend against hostile takeovers;
- Analyzing build or buy decisions for expanding a business;
- Reviewing and recommending cash and stock dividend policies;
- Structuring leverage buyouts for some or all shareholders;
- Valuing the break-up value of a company in preparation for a divestiture plan.
HARTFORD CAPITAL has extensive experience in the preparation of independent valuations of business and corporate securities. Financial valuation studies are designed to meet the unique needs and characteristics of each valuation situation. No single formula, theory, or standard approach can be simply relied upon to meet the multitude of valuation issues that may arise. The valuation study is presented in a comprehensive report, which includes a description of the company, a financial analysis, an economic and industry overview, a description of the methodologies used and the conclusions reached.
HARTFORD CAPITAL has conducted numerous valuation studies for a broad range of purposes including:
Sale Price Analysis
- Employee Stock Ownership Plans
- Merger, Acquisitions, and Divestitures
- Minority Interest Acquisitions
- Recapitalizations and Reorganizations
- Estate, Gift, and Income Tax Matters
- Matrimonial Joint Property Settlement Agreements
- Buy-Sell Agreements
- Stock Repurchases
- Valuing Warrants, Options, and Convertible Securities
- Bankruptcy Proceedings
In determining value, HARTFORD CAPITAL employs the three classic approaches to valuation - Market Comparison, Income Capitalization, and Cost - to arrive at an independent and supportable conclusion of value. Factors considered, among others, include the nature and history of the business, economic and industry outlook, earnings history and forecast, dividend paying capacity, goodwill and intangible assets, prior stock sales and stock prices/profitability of comparative companies.
Valuing Intangible Assets
There are many different intangible assets, all of which require a specialized expertise in the valuation process. Intangible assets, which HARTFORD CAPITAL'S staff has experience in valuing, include: patents, trade names, trademarks, going concern value, goodwill, supply contracts, employment contracts, covenants not to compete, trade secrets, licensing and franchise agreements, customer lists, inventories, engineering drawings, assembled work force, computer software, and favorable financing.
Information and analysis developed in business enterprise valuations can contribute significantly to intangible asset valuations. For tax reporting purposes in a merger or acquisition, the intangible assets have to be "unbundled" from the business enterprise, separately identified and individually valued. A determination of the intangible asset's remaining economic useful life is also required.
While intangible assets are frequently valued as an integral part of the sale/purchase price allocations, the HARTFORD CAPITAL staff has also prepared valuations of intangible assets on a standalone basis. Intangible assets valued on a standalone basis frequently assume that the asset is acquired and used by a prudent investor independent of the current owner. This additional supporting analysis requires extensive professional research, documentation, and judgment.
Rendering Fairness Opinions
Prior to the consummation of a merger or an acquisition, it may be necessary and prudent for the board of directors to have an independent investment firm provide a written opinion letter as to the fairness of the financial terms of the offer. Fairness opinions are presented to the board of directors and published with proxy materials where appropriate.
Fairness opinions may also be required for "going private" transactions, stock repurchases, recapitalizations and corporate restructurings. In some cases, a determination of financial fairness is legally required.
HARTFORD CAPITAL, in preparing a fairness opinion, performs a thorough review of the terms and structure of a proposed transaction and renders its opinion from a financial point of view. Among other factors considered, is the fairness of the price in relation to current and historical market prices, comparable transactions, going concern value and asset sale values. A third party opinion of financial fairness may be influential with a court in protecting directors and trustees against a lawsuit charging that they failed to exercise reasonable business judgment when they approved a business transaction.
Providing Expert Witness Testimony And Litigation Support
HARTFORD CAPITAL professionals have presented expert witness testimony in a variety of valuation matters such as disputed values of securities and businesses with regard to estate, gift and income taxes, corporate recapitalizations and reorganizations, class action suits by stockholders, business damages and matrimonial division of assets.
HARTFORD CAPITAL also provides litigation support to clients and their legal counsel by: conducting an independent review of other firms' valuation reports; assisting in the preparation of interrogatories; consulting during depositions, pre-trial conferences, hearings, and cross-examinations; and structuring and negotiating settlements of valuation disputes.
HARTFORD CAPITAL thoroughly documents support for all conclusions contained in opinions, valuations and litigation support. If necessary, HARTFORD CAPITAL’s professionals are prepared to appear as expert witnesses and present persuasive evidence. Such testimony has been presented before and on behalf of courts and commissions, including:
- Federal and State Courts
- Agent and Appeals Division levels of the IRS
- Bankruptcy Court
- Public Utility Commissions
- American Arbitration Association