Resources: Glossary

Don’t be confused or intimidated by any terms or abbreviations in the M&A world. You’ll find answers here.

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APA = Asset purchase agreement

CA = Confidentiality agreement

CIM = Confidential information memorandum

COGS = Cost of goods sold

DBA = Doing business as

DCF = Discounted cash flow

DPA = Definitive purchase agreement

EBITDA = Earnings before interest, taxes, depreciation, and amortization

ESOP = Employee stock ownership plan

FMV = Fair market value

GAAP = Generally accepted accounting principles

IP = Intellectual property

IRR = Internal rate of return

LOI = Letter of intent

MAC = Material adverse change

MBI = Management Buy-In

MBO = Management Buyout

NDA = Non-disclosure agreement

PE = Private equity

PEG = Private equity group

ROI = Return on investment

SDE = Seller’s discretionary earnings

SPA = Stock purchase agreement

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Intellectual Property (IP)

Definition

A business’ legally protectable intangible assets, including patents, copyrights, trade names, domain names, trade secrets, and trademarks or service marks.

Tips

Intellectual property (IP) can include both registered and unregistered IP. Registered IP includes patents, copyrights, trade names, domain names, and trademarks or service marks. Non-registered IP can include a range of trade secrets, and other proprietary intangible property. Non-registered IP is more difficult to protect, and therefore, stronger agreements are required prior to accepting a letter of intent and allowing a buyer to perform due diligence on a business.

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M&A Guide | Selling Your Business to a Competitor

Intellectual Property (IP)

Definition

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Tips

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