INTRODUCTION - Gottesman-Company



INTRODUCTION PLEASE READ CAREFULLY

RE: M&A Business Broker

Dear Applicant,

Thank you for sending us your resume and for your interest in Gottesman Company. For your information, the qualifying and application process will be done in 3 steps, as outlined below. We look forward to hearing from you.

Step 1: Briefing

The “Briefing” pages that follow (Step 1), will give you an idea of the commissions available in our work as well as the free support services provided to the Brokers in the Gottesman Network.

If after you have reviewed these Briefing pages, you wish to continue, you may proceed to download the “Application” (Step 2), complete it and return the pages to us, ASAP, as we are now deciding who will be invited to our next M&A “Seminar”. Please note the criteria we look for in members of the Gottesman M&A Business Broker Network.

Step 2: Application

At this point, if you are seriously interested, please return the application ASAP, as we have a limited number of seats in the M&A class.

Before returning the application, please consider that, while the opportunity is bona fide, it doesn’t come easy. Here are some of the criteria which we look for in Brokers who are invited to join our Network.

▪ Be a college graduate

▪ Have a minimum of 30 hours available for M&A during the normal work week.

▪ Financially able to work within a long sales cycle and wait out “closings” (patience and perseverance make the difference)

▪ Outside sales experience

▪ Ability to write a business description (using template)

▪ Willingness and ability to prospect by mail and phone. (Our research department will supply the names of M&A Seller prospects in your area). This prospecting is supported by our marketing and research department.

▪ Team Player – willingness to cooperate with GottCo colleagues on specific projects, responding to emails and phone calls on a timely basis.

▪ Self-starter – will initiate efforts (following our system) without waiting for instructions (but unafraid to ask questions and share problems).

Step 3: Independent Contractor’s Agreement for M&A Business Brokers

After your application is received, you will be contacted by either Eugene Gottesman, President, or one of our Regional Managers. If this goes well, you will be invited to complete the Independent Contractors Agreement (“ICA”) in Step 3, and to attend the M&A “Best Practices Seminar” for one week in Westport, CT. Please do not return the Contractor’s Agreement unless invited to do so. Please be aware that you only have to purchase an airline ticket, as well as cover your hotel bill in Westport, CT. (This money will be refunded on your first closing).

[Personal note: if you truly do not have the time availability, or cannot afford to attend the Seminar or wait out long closings, then we would recommend that you do not complete this Agreement, rather than be under stress.]

Applicants

PLEASE READ CAREFULLY

Background Information

Here are some of the facts relative to the Gottesman Company’s operations to save you some time.

▪ We are involved in the sale of privately owned mid-market companies mostly with annual sales of $5 million to $250+ million, although we will work with smaller manufacturers, etc. of interest to our Buyers. We do not usually work with local retailers.

▪ Gottesman Company operates as a Merger & Acquisition Business Broker. We are not your ordinary Business Broker. On closing, by prearrangement, in writing, we can often earn both a fee from the Buyer as well as a transaction fee from the seller with both a Sellside and Buyside Broker involved, if the Seller is a “Gottesman Seller”. If the Seller has come to us from a Cooperating Intermediary, we earn only a Buyside fee.

▪ See the commission chart attached to the application. On a $10 million-dollar transaction for example, with two Gottesman Brokers involved, (one having signed up the Seller and worked with him, and one having signed up the Buyer on our Buyer’s agreement and worked with him), the Sell-side Broker would earn approximately $200,000 and the Buy-side Broker would earn $128,000. Fees would be smaller if the sale was less than ten million, larger if greater than ten million. – So, you can see that there is significant dollar potential for high commission earnings. (We recommend that our Brokers not work both sides in a transaction, as that tends to lead to misunderstandings with Buyers and Sellers, although there is nothing wrong with that either morally or legally.)

▪ We have approximately 100 Merger & Acquisition Brokers in Gottesman Company and Gottesman Company of California, our sister company. They live in the USA, Canada & Europe. They operate both from either home offices with the help of faxes, email, computers, phones, mail, etc., or their own offices elsewhere.

▪ The average age of the people in our group is in its fifties; a high-energy group. Ranging from the 30’s to the 80’s, most of us have either owned our own business and sold it or retired from some corporation. Most of us therefore are “financially secure” so that we can wait out the “closings” which traditionally are related to a sales cycle that can range from the better part of a year or more in our M&A world.

▪ Gottesman Company was established in 1985 in New York City by Eugene Gottesman, former President of New York Yellow Pages Inc., which he sold to Southwestern Bell Telephone Company, (now AT&T). Mr. Gottesman is a Lifetime Certified Business Intermediary, from the IBBA, one of only a handful in the United States.

▪ We also do “super searches” (mainly for “add-ons”) for large Buyers, nationwide. We make an effort to see all of our prospects in person. We don’t usually travel overnight, nor do we usually fly anywhere. If interested, the Buyer will do the travelling to other parts of the U.S. after we’ve secured the interested Seller and information for him. The Seller Rep should be at the Buyer/Seller meeting at the very least.

▪ Most of our 1000+ “Registered Buyers” are Corporations and Acquisition Groups (aka Private Equity Groups) rather than individuals.

▪ Ordinarily we ask for no retainers or expenses, even when we do an industry-specific search. We work solely on “success fees” payable on “closing”. At the same time, our Brokers are incurring expenses for phones, faxes, car, etc. As a rule, we do no entertaining.

▪ We do not do the major accounting and legal work, or due diligence involved in the transaction. The Buyer and Seller each have their own accountants and lawyers. We do however, prepare selling documents and profiles to facilitate the introduction of Sellers to Buyers with “restated” Sellers’ Profit and Loss statements to show the true cash flow based on add-backs to the “Stated Profit” (if the Seller is our client). This work is done to facilitate the introduction of Buyers and Sellers.

▪ We have a “Best Practices” Operations Manual that is given to each of our Brokers for both initial and ongoing reference.

▪ A new Gottesman M&A Broker is invited attend a 5-day M&A “Best Practices” Seminar.

▪ As a supplement to its other activities, the Company supplies Seller and/or Buyer prospect lists, to its Brokers, secured through its research department. The Company provides many support services including research and mailings in connection with Dedicated Searches. Our M & A Brokers also develop their own leads through additional research (mainly centered around SIC codes, which are used in business directories and CD-ROMs, to identify companies by type, size, and location) as well as through industry networking.

▪ One needs to be computer literate: e-mail, research and participation. A car is also basic, so we can visit a client or bring Buyer and Seller together.

▪ Gottesman Company requires no "application fee” to be considered for acceptance to our firm.

▪ Gottesman Company funds and handles advertising, as well as research and direct marketing. We also supply business cards and make available a conference call system. Regional meetings are conducted periodically usually via teleconference (See the list of free services and benefits included).

▪ We currently have eight Regions, in the US and Canada (in addition to Europe & Asia-Pacific), and each has a Regional Manager (who is himself a Broker). They report to our CEO. Each Regional Manager conducts his own group meetings in between our company-wide National Teleconference meetings (which take place monthly).

▪ We are also involved to a degree with International M&A, e.g., England, China

▪ We recognize that a person may not be putting in a 40+ hr. workweek. Trying to do other unrelated work together alongside Gottesman work, in our experience, may be difficult, particularly when large fee projects, such as those on which we work, are involved. This is not a hobby. You must decide whether you can make a serious commitment to success, even if you don’t work full time. Unless you are very serious, it doesn’t make sense to apply.

▪ A person doing our kind of work has to be able to communicate effectively via phone, fax, letter, e-mail and in person. This work involves the “sale of an intangible” and is also “relationship oriented”, requiring close and continuous contact with Buyers and Sellers so they won’t “forget” their obligation to us when deals are closed. We should “stay in the loop” and monitor the transaction after we’ve arranged for the introduction of Buyer and Seller. We prepare selling documents, and then also be involved with transmittals, letters of intent, counteroffers, etc.

▪ GottCo associates work together with other colleagues on almost every project. Each of our associates has to be prepared to remain in contact with and respond timely to, other colleagues requesting information or with whom he is involved on a project.

▪ Each of our people is an “Independent Contractor” and paid accordingly (1099), without tax withholding, social security etc. Our commission agreements with our people are in writing

▪ Our Sellers don’t usually come to us to be “sold”. We approach companies who are “not for sale”. Through our own methods and abilities we convince them to meet with our Buyer(s). We remain in the loop having prepared initial information documents which are exchanged. We monitor the progress of each introduction after fulfilling our initial role as finders. If the first Buyer doesn’t work out, we will work to find another Buyer.

▪ We assign any leads that come in, to our Brokers, taking into account a combination of geography, workload, experience and personality.

▪ We cooperate with “Other Intermediaries and Business Broker” firms throughout North America and worldwide through our Cooperating Intermediary program. (We refer to these firms as “OBs” – Outside Brokers.)

▪ We have a Support Staff office in New York and Connecticut that processes our contracts, processes research requests and leads, handles direct mail and screens Buyers and Sellers who might call us directly from ads, mailings, referrals, responses to our unique M&A Buyer app.

▪ Additional assistance is available from the Regional Manager, CEO and President, as well as knowledgeable colleagues who come from a variety of fields and are always willing to help.

▪ We are members of the I.B.B.A. (International Business Brokers Association), The Association for Corporate Growth (ACG) and the Better Business Bureau (BBB) - who rates us “A+”, among others. We are also listed with Dun & Bradstreet with a top rating.

▪ You may find us on the Internet. Our website address is Gottesman-.

If you understand the above, are ambitious, self-disciplined, and capable of making a serious commitment and are not deterred by the long lead-time to closings, we’d be glad to hear from you. In certain states a Real Estate License may be required.

Thank you very much for your interest in the possibility of becoming involved with Mergers & Acquisitions through Gottesman Company. We look forward to the receipt of your application and possibly going to the next step.

Seller’s & Buyer’s Fee Schedules

& GottCo Brokers’ Commissions

As of November 27, 2017

| | | | | |Buyer’s Fee | |

|Total |Seller’s Fee |Broker’s Share | |Total |To Gottesman Company |Broker’s Share |

|Consideration |To Gottesman Company |Of Seller’s Fee | |Consideration |(Based Upon Receipt of Payments per BB2 Fee |Of Buyer’s Fee |

|Involved |(Based Upon Receipt of Payments per SS1 or SS2 | | |Involved |Schedule) | |

| |Fee Schedule) | | | | | |

|$ 1,000,000 | | | | | | |

| |$ 100,000 |$ 40,000 | |$ 1,000,000 |$ 100,000 |$ 40,000 |

| | | | | | | |

|$ 2,000,000 |$ 150,000 |$ 60,000 | |$ 2,000,000 |$ 150,000 |$ 60,000 |

| | | | | | | |

|$ 5,000,000 |$ 300,000 |$ 120,000 | |$ 5,000,000 |$ 210,000 |$ 84,000 |

| | | | | | | |

|$ 8,000,000 |$ 450,000 |$ 180,000 | |$ 8,000,000 |$ 280,000 |$ 112,000 |

| | | | | | | |

|$ 10,000,000 |$ 500,000 |$ 200,000 | |$ 10,000,000 |$ 320,000 |$ 128,000 |

| | | | | | | |

|$ 15,000,000 |$ 700,000 |$ 280,000 | |$ 15,000,000 |$ 420,000 |$ 168,000 |

| | | | | | | |

|$ 20,000,000 |$ 900,000 |$ 360,000 | |$ 20,000,000 |$ 520,000 |$ 208,000 |

| | | | | | | |

|$ 30,000,000 |$1,200,000 |$ 480,000 | |$ 30,000,000 |$ 620,000 |$ 248,000 |

| | | | | | | |

|$ 40,000,000 |$1,400,000 |$ 560,000 | |$ 40,000,000 |$ 720,000 |$ 288,000 |

| | | | | | | |

|$ 50,000,000 |$1,500,000 |$ 600,000 | |$ 50,000,000 |$ 820,000 |$ 328,000 |

| | | | | | | |

|$ 75,000,000 |$1,750,000 |$ 700,000 | |$ 75,000,000 |$1,070,000 |$ 428,000 |

| | | | | | | |

|$100,000,000 |$2,000,000 |$ 800,000 | |$100,000,000 |$1,320,000 |$ 528,000 |

| | | | | | | |

|$200,000,000 |$3,000,000 |$1,200,000 | |$150,000,000 |$1,820,000 |$ 728,000 |

| | | | | | | |

|$300,000,000 |$4,000,000 |$1,600,000 | |$200,000,000 |$2,320,000 |$ 928,000 |

| | | | | | | |

|$500,000,000 |$6,000,000 |$2,400,000 | |$300,000,000 |$3,320,000 |$1,328,000 |

Broker’s Fee distributions vary in accordance with whether there is a) any sharing by GottCo Reps in a waived fee situation, b) an OB Gatekeeper, c) CA only or whether there is a d) duality fee with fees received from both Buyer and Seller, or e) participation by a “Business Development Intermediary”.

FREE SUPPORT SERVICES and other Benefits for

GottCo M&A Business Brokers

Dear Potential Colleague,

Many Free Services and Other Benefits are available to GottCo Brokers to support their M&A efforts in the midmarket arena (companies with annual revenue of $3 Million to $500 Million). See attached list of these free services and benefits furnished by Gottesman Company its Brokers, who are members of the GottCo network.

We have major plans on deck to accelerate our progress. Please review the attached list of Free Services and Benefits and consider the advantages of being a member of the Gottesman Network of Independent M&A Business Brokers. Your comments are welcome.

Sincerely yours,

Gene Gottesman

Chairman/President

FREE SUPPORT SERVICES

& Other Benefits For Network Members

|Membership in GottCo Network of Independent Contractors |Editorial Support for Profiles and Executive Summaries |

| | |

|BDI Appointments for Special Projects |Pre-approved Travel Expenses |

| |(Refunded on Closing) |

|Gottesman Buyer Matrix - 5,000 companies | |

|National Coverage. Excel spread sheet Sortable by SIC, Description, Location, |QwikSearches to find Buyers to match your Sellers |

|Size, Equity Group Portfolios etc. |(e-mails also sent to Buyer prospects) |

| | |

|“Lead-In Buyer” Assistance |Agreement Forms (Buyers, Sellers, OBs) |

| | |

|Dedicated Searches Including mailing |GottCo is Rated “A+” by the Better Business Bureau |

| | |

|GottCo VideoIntro ServiceSM |1200 plus Registered Cooperating Intermediary firms (Domestic & International) |

|(via GottCo corporate membership) | |

| |No Overnight travel requirements |

|Access to Pitchbook and other Buyer Sources “PEG” information (via Research | |

|Department) |Access to Management |

| | |

|Advertising your Sellers and Buyers Via GottCo Reports to Buyers and OBs; Media |140 Seller Listings |

|insertions; GottCo & Various M&A Websites | |

| |100 + Colleagues USA nationwide and Canada with whom to Network and Interact |

|GottCo Public Website - Your GottCo and OB Listings | |

| |Duality-Fee Opportunities |

|Members-Only Website |(Buy-Side and Sell Side Commissions) |

|Access to Gottesman Buyer Matrix; Seller list with Status; Tutorial Articles; | |

|Seller BDI Leads |Major Commission Opportunities |

| | |

|Ongoing Reviews and Tutorials |M&A Seller Prospects |

| |(from $3 Million to $500 Million in sales) |

|FindersClub – to build your own personal Lead network |Independent Contractor Status (1099) |

| | |

|M&A “Best Practices” Manual (included in Registration Documents) |Protected Accounts – |

| |Both Sellers and Buyers |

|Buyer & Seller Research | |

| |Corporate Awareness Program |

|Buyer & Seller Leads (Call-Ins) |Gottesman Seller Report sent to Seller Prospects |

| | |

|ESP Leads |1000 Registered Buyers (who own 5000 companies) |

| |Equity Groups and Industry Buyers |

|Your Personal GottCo Email Address | |

| |30 year History – Established 1985 |

|Business Cards | |

| |Regional Managers for Administrative Assistance |

|Promotional Material | |

| |Office Personnel for Administrative and Research support |

|Legal Support for Collection and other Problems | |

| |One Week M&A “Best Practices” Seminar |

|National and Regional Teleconferences |(Registration fee required for seminar materials) |

| | |

| |Others as Needed |

| |RL 12/7/15 |

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