Exit Readiness™ · HLP Capital Advisory

Not deal advisory or investment banking. Exit Readiness™ is a coordination diagnostic. HLP does not source buyers, negotiate LOIs, or execute transactions. Findings surface pre-market moves for you to discuss with your investment banker, M&A attorney, CPA, and wealth advisor — those licensed professionals own the regulated advice and execution.

◉ TIMELINE · 01

Exit horizon.

How much runway do you have to prepare? Every category of pre-market moves has an ideal minimum lead time. Under 12 months, most sophisticated moves are already off the table.

Target exit window

AUnder 12 months B12 – 24 months C24 – 36 months D3 – 5 years E5+ years / exploring

◉ TIMELINE · 02

Preferred exit type.

Strategic sale · PE roll-up · management buyout · ESOP · family transition · full-recap. Each requires different preparation and different specialists.

Most-likely exit path

AStrategic sale (industry buyer) BPrivate equity / financial buyer CManagement buyout DESOP EFamily / next-gen transition FRecap / partial liquidity ?Undecided

◉ PROFILE · 01

Business size band.

Buyer universe changes dramatically by size. Under $5M EBITDA, mostly strategics and search funds. $5M–$25M is prime PE lower-middle-market. Above $25M unlocks upper-middle and growth equity.

Trailing 12-month EBITDA

AUnder $500K B$500K – $2M C$2M – $5M D$5M – $15M (lower-middle PE) E$15M – $50M (upper-middle) F$50M+

◉ VALUE · 01

Owner dependency.

The single biggest driver of exit multiple. Businesses where the owner IS the business trade at 3-4× EBITDA. Businesses that run without the owner trade at 6-10×+. Reducing dependency is the highest-ROI move you can make.

Owner-dependency posture

✗I AM the business (all key relationships) ◑High dependency · key decisions still through me ◐Moderate · management runs day-to-day ✓Low · could vacation 30 days without issue

◉ VALUE · 02

Management depth.

A second-tier management layer that can operate the business post-close is worth 1-2 turns of EBITDA. Missing management is the most common reason deals renegotiate at diligence.

Second-tier management

✗No senior management team ◑One key operator ◐Small team · gaps remain ✓Full C-suite / department heads

◉ VALUE · 03

Revenue quality.

Recurring > contracted > repeat > project. Buyers pay dramatically higher multiples for predictable revenue. SaaS-like recurring revenue can command 8-15× EBITDA vs. 3-5× for project revenue.

Revenue mix

AMostly project / one-time BRepeat customers · not contracted CContracted revenue · <12mo terms DSubscription / recurring >70%

◉ VALUE · 04

Customer concentration.

Any customer >20% of revenue triggers escrow holdbacks and earn-outs. Above 40%, most PE buyers pass entirely. Diversifying pre-market is often the single most-important move.

Largest customer % of revenue

✓Under 10% (diversified) A10 – 20% B20 – 40% (caution zone) ✗40%+ (deal-blocking)

◉ HYGIENE · 01

Financial hygiene.

Buyers require 3 years of clean statements minimum. Reviewed or audited unlocks bank financing for the buyer and reduces diligence friction. QoE (Quality of Earnings) is table-stakes above $2M EBITDA.

Financial statement quality

AInternal only (QBO / self-prep) BCPA compiled CCPA reviewed DAudited ✓QoE report already run

◉ HYGIENE · 02

EBITDA normalization.

Owner-benefit add-backs (personal auto, insurance, home office allocations, family payroll) legally increase reported EBITDA. Documented add-backs are worth their weight in multiple — undocumented ones get argued out at diligence.

Add-back documentation posture

✗None documented / none exist ◑I know they exist · not documented ◐CPA has informal list ✓Formal normalization workbook

◉ HYGIENE · 03

Legal housekeeping.

Operating agreement current · minutes maintained · IP assigned to entity · employment agreements executed · litigation clean. Legal hygiene issues surface in diligence and cost dollars per issue.

Legal hygiene items · which are current? (multi-select)

Operating agreement current Meeting minutes maintained IP assigned to entity Employment agreements executed Contractor/IC agreements clean Customer contracts assignable No open litigation Regulatory licenses current

◉ OPERATIONS · 01

Systems & SOPs.

Documented processes prove the business can operate without the founder. Buyers pay premium multiples for a business that ships an operating manual with the CIM.

Operational documentation

✗Everything in owner's head ◑Some documented · gaps large ◐Most functions documented ✓Full SOP library maintained

◉ MARKET · 01

Valuation awareness.

Owners routinely misprice their business by 40-60% in either direction. A current valuation is the anchor for every subsequent decision — from tax positioning to negotiation strategy.

Valuation status

✗Never had one ◑Informal / rule-of-thumb estimate ◐Formal · but >2 years old ✓Formal · within past 12 months

◉ MARKET · 02

Pre-exit tax structure.

§ 1202 QSBS · installment sales · charitable remainder trusts · pre-sale gifting · state domicile. Pre-market tax positioning routinely saves 8-figure tax bills — but most require 2+ years of lead time.

Pre-exit tax positioning

✗Nothing structured yet ◑CPA/attorney exploring ◐Some structures in place ✓Fully optimized · attorney-blessed

◉ LIFE · 01

Post-exit life plan.

The single biggest cause of deal fall-through in the final 30 days: the owner realizes they don't know what they'll do next. Post-exit planning is not a soft variable — it's a deal-closing variable.

Post-exit planning status

✗Haven't thought about it ◑Vague ideas · no plan ◐Written draft of next chapter ✓Clear · confident · family-aligned

◉ TEAM · 01

Deal-team bench.

The right team assembled 12+ months before market saves money and increases sale price. The wrong team assembled at LOI costs both.

Which specialists are in place? (multi-select)

Investment banker / M&A advisor M&A attorney Tax attorney CPA (proactive) Wealth advisor (post-close) Estate attorney Exit coach / consultant None assembled yet

What's on your mind?

◉ REPORT DELIVERY

Where do we send your report?

Chekelah's team reviews every submission within 48 hours. Full Exit Readiness Report™ arrives as signed PDF suitable for handoff to your IB, M&A attorney, and CPA.

I understand this is a coordination diagnostic, not investment-banking or legal advice. HLP does not source buyers or execute transactions. Privacy Policy.

◉ SURFACING MOVES

—/100

SCORING

Your Exit Readiness score is being surfaced across the 12 highest-leverage moves your deal team should evaluate.

◉ TOP MOVES TO EVALUATE WITH YOUR DEAL TEAM

DELIVERABLE

Full Exit Readiness Report™ arrives in 48 hours

Chekelah's Capital Advisory team reviews every submission. Report includes: full move-scored register with impact-per-move estimates in EBITDA-multiple points, sequencing recommendation, and — where warranted — introductions to DFW-based investment bankers, M&A attorneys, and QoE specialists matched to your deal size.

Email capital@hlpcredit.com See Business Owner Pathway →

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