Does anyone have a good independent sponsor agreement template?

by a searcher from University of Redlands

2 months ago

As a PE Portco exec for the past 22 years I have significant connections. Through those connections I have some friends and colleagues who are successful entrepreneurs needing investment or a path to exit.  Most are middle and lower middle market.  

Before I have my lawyer draw up an agreemnt I'd like to see if anyone has one.  I may have 2-3 companies to present to other friends, PE, VCs, or angel investors by christmas  

Thanks.

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searcher from University of Manitoba

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2 months ago | like reply | 0 likes

professional from Dartmouth College

First you'll need to work up a term sheet with the key terms, which for an IS would typically include: your proposed closing ("diligence fee'), which is typically rolled into the deal, your management fee (based on EBITDA of the target), and your carry with thresholds. The "agreement" I think you're referring to would be the Operating Agreement for the LLC which is buying the target (buying assets or holding shares). Typically most IS investors will want you to bring them the deal first before they'll spend the time on a generic agreement on terms, or at least some more specifics on types of deals. But if you have people interested you can probably ballpark your proposed terms to see if there's alignment. I wouldn't spend money on legal fees without a deal lined up.

2 months ago | like reply | 0 likes

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