KEN KIRSCHENBAUM, ESQ ALARM - SECURITY INDUSTRY LEGAL EMAIL NEWSLETTER / THE ALARM EXCHANGE You can read all of our articles on our website. Having trouble getting our emails? Change your spam controls and white list ken@kirschenbaumesq.com ************************************ Does coronavirus effect valuation May 5, 2020 ********************** Does coronavirus effect valuation ******************* Ken If I wanted to sell my company within the next 30-60-90 days, any thoughts on how the coronavirus concerns and economic uncertainty would affect valuation? I’m the typical alarm company with about a 60% residential, 40% commercial mix; probably 10% of customers fall into the small retail, restaurant, hair salon, etc category. Name withheld *********************** Response *********************** You aren’t selling within 30 to 90 days unless you are giving your accounts away. If nothing else the virus is going to slow things down. Must everyone [not K&K of course] is behind schedule, worrying instead of working and catching up on favorite TV or meals. No time for contract negotiations, lawyers, accountants [unless it’s PPP related], arranging financing, due diligence or taking over accounts when you can’t get in to inspect a few sample installations. Lots of things on hold, and alarm deals are no exception. But if you can hold out a few more months things should stabilize, especially security and fire RMR accounts. I’m not the only “expert” out there that values alarm accounts [WhatsMyAlarmCompanyWorth.com], but I have not moved off the 35 times RMR range for typical accounts supported by proper contracts. Up or down a few points and you should be within range as long as you have conducted your alarm business in a customary manner. Customary, meaning properly adhering to most of the recommendations of the expert alarm business consultants, which I need not get into here. The present economy certainly does affect alarm account valuation because, for one thing, we can anticipate a higher than average attrition rate. Expect more demand for the account guarantee and the holdback that secures the guarantee. This one single negotiated term could be enough to hold up or kill contract negotiations. There may also be a backlog of repair requests that a seller hasn’t been able to get to; another open issue to negotiate. Jobs in progress that now, for a myriad of reasons, never get finished or paid for. Form a financial perspective I am not sure where the lenders are now. Just before the virus there seemed to be a lack of interest in financing alarm account acquisitions except for a handful of alarm industry focused lenders. With interest rates where they are now I don’t know if any lender wants to tie up money for very long. Maybe that’s a good thing for the alarm industry since the small to mid-sized loans would be for less than 5 years. The best, fastest and most economical way to get an unbiased evaluation is to go to WhatsMyAlarmCompanyWorth.com. For $80 bucks you can stop wondering what your company is worth and get a fair valuation. ********************** Reaching K&K during the lock down ********************** During this crisis the most efficient way to reach our attorneys is via email. You can also call and if not picked up, leave a message and your call will be returned promptly. Here are a few departments to contact directly: alarm / security / pers / fire department: Ken - Ken@Kirschenbaumesq.com or call and leave a message with return number at 516 747 6700 x 301 health care professionals: Jennifer Kirschenbaum,Esq 516 747 6700 x 302; jennifer@kirschenbaumesq.com Alarm contracts: Eileen Wagda 516 747 6700 x 312 Alarm licensing: Alison Gallub,Esq 516 747 6700 x 317 AGallub@Kirschenbaumesq.com; or Eileen Wagda, Licensing Administrator, 516 747 6700 x 312 EWagda@Kirschenbaumesq.com Employment issues: Kieran Bastible 516 747 6700 x 315 kbastible@kirschenbaumesq.com; or Jennifer Kirschenbaum,Esq Concierge Alarm Clients have full access through our Concierge Program Coordinator, Stacy Spector, Esq 516 747 6700 x 304 or SSpector@Kirschenbaumesq.com Collections: [courts are shut down at this time, so don't expect much progress. We will however continue to prepare papers on our end so that we will be ready when the courts normalize] Kathleen Lampert 516 747 6700 x 319 KLampert@Kirschenbaumesq.com Pending litigation: Caroline Wallet,Esq CWallett@Kirschenbaumesq.com 516 747 6700 x 305 and Maureen Biel,Esq 516 747 6700 x 303 MBeil@Kirschenbaumesq,com Bankruptcy and debt collection issues: Steve Sheinwald,Esq 516 747 6700 x 309 SSheinwald@Kirschenbaumesq.com or Scott Dillon,Esq 516 747 6700 x 318 **************** To order up to date Standard Form Alarm / Security / Fire and related Agreements, click here:www.alarmcontracts.com ************************* CONCIERGE LAWYER SERVICE PROGRAM FOR THE ALARM INDUSTRY You can check out the program and sign up here: https://www.kirschenbaumesq.com/page/concierge or contact our Program Coordinator Stacy Spector, Esq at 516 747 6700 x 304. *********************** NOTICE: You can always read our Articles on our website at ww.kirschenbaumesq.com/page/alarm-articles *********************** THE ALARM EXCHANGE
This area is reserved for alarm classifieds, alarm company announcements, solicitations, offers, etc. There is no charge to post a listing here.Include your contact information, phone, email and web site. If you would like to submit a post, please send an email to ken@kirschenbaumesq.com. To create a reciprocal link to our website, click here. ************************************************ Getting on our Email List / Email Articles archived: Many of you are forwarding these emails to friends or asking that others be added to the list. Sign up for our daily newsletter here: Sign Up. You can read articles and order alarm contracts on our web site www.alarmcontracts.com ************************** Ken Kirschenbaum,Esq Kirschenbaum & Kirschenbaum PC Attorneys at Law 200 Garden City Plaza Garden City, NY 11530 516 747 6700 x 301 ken@kirschenbaumesq.com www.KirschenbaumEsq.com
