When professionals with over 90 years of combined investing experience decided to form a standalone mezzanine debt fund, they had no trouble attracting commitments from some of the savviest institutional investors. The Praesidian team clearly demonstrated a "healthy investing" thesis to these investors. At Brandlin & Associates, we feel privileged that Praesidian relies on us to help implement its plan.

Praesidian has retained Brandlin for pre-funding due diligence for health clubs, including Planet Fitness, an auctioneer, an insurance company serving small businesses and a distributor of intimate apparel, among others. While the industries are disparate, the companies that ended up making the grade for Praesidian shared characteristics such as sound capital structures, honest management teams, leading market positions and, of course, proven profitability.

However, it is not always easy to find healthy companies and close sound deals. Some of the issues uncovered by Brandlin in due diligence and the eventual outcomes include:

• Target company's largest customer, representing 35% of sales, was going to change vendors: the purchase agreement was terminated, then reborn weeks later to the benefit of the investors.
• No confidence in the acquirer's financial statements: deal declined by Praesidian.
• Inventory overstated by 15%: the parties were able to come to agreement on the actual value of the inventory and the deal eventually closed.
• Financial statements not in conformity with GAAP: negotiated price adjustment and deal closed.
• EBITDA could not be substantiated by management: deal declined by Praesidian.

Praesidian is a responsive and decisive organization that understands the need for management and financial sponsors to secure timely investment commitments. We consistently are impressed by their disciplined and thorough approach to investing and look forward to continuing our relationship for many years to come.

Praesidian Capital, LLC provides mezzanine debt to established, historically profitable middle-market companies with revenues between $25-250 million and operating cash flow between $5-25 million. The firm typically commits between $4-15 million of capital for growth, management/leveraged buyouts, recapitalizations and refinancings.

Brandlin & Associates is an exclusive provider of investigative accounting, financial consulting and strategic consulting services. We pride ourselves on offering superior technical expertise, years of practical experience and unparalleled service to decipher financial and operational performance metrics. As a result, our clients are able to make informed decisions in a timely manner.

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