Sary performs comprehensive due diligence on individuals and entities in order to alert clients to risks, disclosure issues, and potential negotiation points. Our multidisciplinary project teams provide support tailored to meet clients’ individual needs, from financial, tax, commercial, operational, IT and cyber diligence; this helps our clients in identifying transaction value drivers, improve deal structures and mitigate risks and on-board the right & reputable service provider/supplier.
Our due diligence inquiry encompasses:
Legal Due Diligence:
In our legal due diligence, we examine:
- Copy of Memorandum and Articles of Association
- Minutes of Board Meetings for the last three years
- Minutes of all meetings or actions of shareholders for the last three years
- Copy of share certificates issued to Key Management Personnel
- Copy of all guarantees to which the company is a party
- All material contracts, including any joint venture or partnership agreements; limited liability company or operating agreements
- Licensing or franchise agreements
- Copies of all loan agreements, bank financing agreements, and lines of credit to which company is a part
HR Due Diligence
This focus on human resource related aspects including;
- Analysis of total employees
- Analysis of current salaries, bonuses paid
- All employment contracts with nondisclosure, non-solicitation, and non-competition
- HR policies
- Analysis of employee problems
- Potential financial impact of any current labor disputes
- Employee health benefits, welfare insurance policies or self-funded arrangements
Environmental Due Diligence:
This covers matters related to environmental regulation including;
- List of environmental permits and licenses and validation of the same.
- Copies of all correspondence and notices local regulatory agencies.
- Verify that the company’s disposal methods are in sync with current regulations.
- Check to see whether there are any contingent environmental liabilities or continuing indemnification obligations.
Tax Due Diligence:
This focuses on tax liability and tax compliance aspects relating to a company or individual. It encompasses:
- Verification of tax compliance certificates
- Verification of past and pending tax audits
- Verification of Net Operating Loss (NOL)
- Verification of tax returns
Intellectual Property Due Diligence:
This focuses on company’s intangible assets that differentiate company’s products from the competitors. Our focus in this is to:
- Any pending claims case by or against the company in regard to violation of intellectual property
- Schedule of patents and patent applications
- Schedule of copyrights, trademarks, and brand names
- Pending patents clearance documents
Asset Due Diligence:
Verifies admin-related items such as facilities, occupancy rate, number of workstations, etc.
Financial Due Diligence:
Provides a thorough understanding of all the company’s financials, including, but not restricted to, audited financial statements for the last three years, recent unaudited financial statements with comparable statements of the last year, the company’s projections and basis of such projections, capital expenditure plan, schedule of inventory, debtors and creditors, etc.
Asset Due Diligence:
Gives a detailed schedule of fixed assets and their locations (if possible physical verification should also be done), all lease agreements for equipment, a schedule of sales and purchases of major capital equipment during the last three to five years, real estate deeds, mortgages, title policies, and use permits.