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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Shareholders’ Agreement

Definition

An agreement by and among the shareholders (owners) of a company pertaining to the governance of the company, the rights of the shareholders, the duties of the shareholders, and restrictions on the transfer of the shareholders’ equity interests.

Shareholders’ Agreement

Definition

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