HALO Academy 2 Minute Financial Drill: Asset Purchase Agreement
Every Wednesday we release our all new "HALO Academy: 2 Minute Financial Drill" by Integrity Square Founder & HALO Talks host, Pete Moore on everything you need to know for financial literacy, unit economics, legal documents used for M&A and capital raises, capital sources you can access, understanding how financings are structured, valuation metrics and parameters, and what you need to know about your own business before engaging in cap raises and/or a potential sale.
If you missed our email about this, you can re-read it here: https://mailchi.mp/9567da51c0ce/2025programschedule
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RESOURCES
- https://www.integritysq.com
- https://www.halotalks.com
- https://www.thehaloacademy.com
- Watch the video here: https://www.youtube.com/@halotalks
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ABOUT YOUR INSTRUCTOR
Pete is the Founder, Managing Partner and Chief Dream Architect at Integrity Square ("ISQ"), a leading boutique financial advisory firm focused on the $4.7T Health, Active Lifestyle, Outdoor ("HALO") sector. Since founding ISQ in 2010, the firm has played an active advisory role in 100+ mergers & acquisitions, private placements and advisory assignments across North America.
Pete Moore and his team have also invested in passionate entrepreneurs at HigherDOSE, XTEND, and Promotion Vault. ISQ's media and "live education" properties include HALO Talks, the leading B2B podcast in the sector, Time To Win Again, and the HALO Academy, an Executive Education Bootcamp Series.
Prior to ISQ, Pete was Head of the Active Lifestyle & Wellness Group at Sagent Advisors (2003-2010.) Prior to 2003, Pete was co-founder of FitnessInsite, a SasS sales management platform with 1500+ clients (based in AZ.) At FitnessInsite, Pete invested his personal capital, leveraged his credit cards and learned what it takes to manage a startup.
Pete built his business and financial acumen on top of the foundation laid at three critical positions early in his career: Senior Associate at Brockway Moran & Partners, the private equity owner of Gold's Gym International, Inc; worked as an Associate at Donaldson, Lufkin & Jenrette; and an Analyst at Chase Securities. (Now JP Morgan.)
ISQ saw a need for a deeper & more useful level of education in the HALO sector. In response, we launched the HALO Talks podcast, with 500+ completed interviews and over 120,000 downloads. HALO Talks has become a "must listen" for anyone working or investing in the sector.
Pete graduated from Emory University (BBA, 1994) and received his MBA from Harvard Business School (1999.) While at HBS, he co-founded IRON PLANET, the leading B2B auction site for used heavy equipment, which was sold to Ritchie Bros for $758 million. His hobbies include: Football, basketball, tennis, podcasting, amateur ventriloquism, pro bono DJ and fitness enthusiast.
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This is Pete Moore at Integrity Square. We are in month six
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of the sale of Project Willow. We're excited to report that we have
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picked the Ganilin Group as our potential financial buyer.
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They're going to pay a six times EBITDA and we got through our quality
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of earnings report unscathed where they have not
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questioned or changed any of our assumptions related
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to the cash flow that we are providing to the buyer
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in this deal. We just got the asset purchase agreement, which
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is the APA, which is another 50 pages of fun
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reading on your bedside any night of the week. That
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asset purchase agreement is going to be all of the assets that
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are going to be acquired by the Ganlon Group through a special purpose
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vehicle, an spv, to acquire all of our
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assets, which will include all the clubs, all, all the leases,
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all the membership agreements. And the rest of the document is
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going to talk about things that could potentially go wrong and
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what you have to represent and warrant that we provided.
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So as the owner, you are now part of what's called
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seller's knowledge. And you're also the signator
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on this transaction. This transaction will say we're going
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to buy the company for $60 million. And they have proposed
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a 5% out of that 60, which would
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be $3 million. Escrow account. Now, an
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escrow is a term from France.
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It was basically that if I bought a house but I didn't pay for it
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yet, it's basically like the deed or the title that would go into
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a bank or, or going to a legal organization that would hold
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my deed until I paid for the title to
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a property. So just like that, escrow
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has now been used in the way of saying I'm going to hold back some
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of that money. 3 million to ensure that everything you told me
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in this asset purchase agreement and all the documents are actually true.
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If not, I'm going to come back and try and first tap the escrow
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account, which is a neutral bank account that now I'm going to take
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because you might have lied to me. A little, nice
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little culture in there.