Transaction Opinion Services

Pendo’s professionals have the unique experience of providing fairness and solvency opinions to private and public company boards and fiduciaries on transactions ranging from the lower middle market to multi-billion dollar going private transactions and can assist with a range of transaction opinion services including:

Fairness Opinions

Pendo provides fairness opinions related to a variety of transactions including:
• Related Party Transactions
• Exchange Offers
• Recapitalizations & Restructurings
• Spin-offs
• Stock Repurchases
• Corporate Acquisitions & Divestitures
• Mergers
• Leveraged Buyouts
• Going Private
• ESOP / ERISA Transactions

Solvency Opinions

A solvency opinion is often obtained by a company’s board in connection with a special dividend, spinoff, or leveraged transaction.
• Boards of Directors can be held personally liable in cases of fraudulent transfers or illegal distributions.
A solvency analysis encompasses valuation and cash flow tests that determine if, after giving effect to a proposed transaction:
• The sum of the assets of the company, both at a fair valuation and at present fair salable value, exceeds its liabilities, including contingent, subordinated, unmatured, and unliquidated liabilities;
• The company has sufficient capital with which to conduct business; and
• The company has not incurred debts beyond its ability to pay such debts as they mature.
In situations where a company is making a dividend payment, a solvency opinion also addresses the sufficiency of surplus to effect the distribution.
• Delaware Corporation Law and other states’ corporation laws require that dividends be paid out of surplus, which is defined as the excess of the net assets of the corporation over its capital (capital is usually the par value of issued stock).