PRACTITIONER REFERENCE GUIDE · BUY THE DREAM CAR

Liquidity Event Playbook

By Philip A. Baratelli, CPA, MBA · Baratelli Institute · Edition 1

THE FOUNDING THESIS

"Life is short. Buy the dream car. Don't listen to Dave Ramsey. I've never seen a sad person in a brand new red sports car with the top off."

A liquidity event is two things at once: a financial event — the tax sequencing, the QSBS stacking, the working-capital peg, the rollover-equity decision, the escrow negotiation, the residency planning, the charitable substitution — and a psychological event: the day you wake up able to provide different options for your family. The Liquidity Event Playbook is the reference for both. For the founder who has spent twenty years building. For the CFO running point on the LOI, the QofE, the §280G analysis, the press release. For the investment banker stewarding the process. And for the practitioner who has crossed the line themselves, written by someone who has been on the wire-hit-the-account side of two of these events — once at Armor Holdings, once at ReliaQuest. Each chapter is the thing you wish you'd read three weeks before the LOI hit. The last chapter is permission to enjoy what you built.

266+pages

28tab Excel workbook

8free web tools

16AI prompts inline

What it is: A complete, practitioner-voiced reference.

$349Buy on Gumroad → ★ Read a free chapter →

Who this guide is for

The guide is written for the actual professionals who do this work — and the people who serve them. Each section contains material that will be useful to multiple audiences, but the persona-routing table below tells you where to start.

You are…	Start with these chapters
Founder selling a closely-held company	Ch 1 What's About to Happen · Ch 2 Pre-LOI Hygiene · Ch 4 LOI Reading · Ch 8 Working Capital Peg · Ch 11 Escrow & Indemnity · Ch 13 Post-Close Life
CFO running point on the deal	Ch 3 The QofE · Ch 5 Adjusted EBITDA · Ch 8 WC Peg · Ch 9 Rollover Equity · Ch 10 §280G · Ch 11 Escrow · Ch 12 R&W Insurance · Workflow Playbook A
Investment banker on the sell-side	Ch 2 Pre-LOI Hygiene · Ch 4 LOI Reading · Ch 6 Process Letter · Ch 7 Bid Evaluation · Ch 11 Escrow · Workflow Playbook B (sell-side process map)
M&A counsel for the seller	Ch 4 LOI · Ch 9 Rollover · Ch 10 §280G excise · Ch 11 Escrow & Indemnity · Ch 12 R&W · Ch 14 Post-Close Disputes
CPA / wealth advisor preparing the founder	Ch 1 What's About to Happen · Ch 9 Rollover Equity · Ch 10 §280G · Ch 13 Post-Close Life · Apx C Pre-Sale Tax-Planning Checklist

Page counts are approximate.

PART I — Pre-LOI

1What's About to Happen — A Pre-Sale Reality Checkp1

2Pre-LOI Hygiene — Six Things You Wish You'd Done a Year Agop9

3The Quality of Earnings — What It Is, Who Reads It, How to Passp17

4Reading the LOI — The Six Lines That Determine the Outcomep25

PART II — Process & Negotiation

5Adjusted EBITDA & Working-Capital Definitionsp33

6The Process Letter & the Sell-Side Timelinep41

7Bid Evaluation — Comparing Apples to Apples to Applesp49

8The Working Capital Peg — Build, Defend, Settlep57

PART III — Closing Mechanics

9Rollover Equity — The 30% You Don't Cash Outp67

10§280G Excise Tax — Why Your Bonus Pool Matters Nowp79

11Escrow, Holdback, Indemnity, Survival Periodsp87

12R&W Insurance — When It Replaces Indemnity, When It Doesn'tp99

PART IV — After the Wire Hits

13Post-Close Life — Earnouts, Transition Services, Restrictive Covenantsp109

14Common Post-Close Disputes & The Recovery Playbookp119

Appendices

AWorkflow Playbook — Sell-Side Process Map (16 milestones)p129

BWorkflow Playbook — Buyer-Side DD Coordinationp137

CPre-Sale Tax-Planning Checklist (12 months out, 6 months out, T-1)p141

DGlossary of Deal Termsp145

EIndex with Page Referencesp149

What's actually in the bundle

1. The reference guide (PDF)

226 pages, 16 chapters (now including dedicated Q-of-E and R&W insurance chapters) + appendices with a buyer-pool taxonomy, sample LOI, and four practitioner directories. Searchable, hyperlinked TOC and continuous 1-226 pagination. AI prompts inline at section boundaries. Single-user license. A complete, practitioner-voiced reference.

2. The companion Excel workbook (XLSX)

28 working tabs — working capital peg builder, §280G safe-harbor calculator, rollover equity scenario tab, escrow ladder model, indemnity-cap calculator, adjusted-EBITDA bridge, the 16-step sell-side process tracker, plus the eight new tabs added in the 2026 build (Q-of-E add-back catalog, R&W premium ranges, QSBS stacking, buyer-pool scoring, and more).

3. Two workflow playbooks (sell-side process map · DD coordination)

Each playbook is a real working tracker — the milestones a sell-side advisor uses on Monday morning. The same one Phil has used to run M&A engagements since 2008.

4. The pre-sale tax-planning checklist

What you do at T-12 months, T-6 months, and T-1 month before the LOI. The QSBS clock, the trust funding decision, the family LLC, the §1202 stacking question, and the F-reorg conversation if you're still an S-corp.

Plus: Free live tools derived from this guide

Free interactive tools at tools.baratelliinstitute.com run the math from the guide on your scenario. No purchase required.

Liquidity Event Decision Simulator Working Capital Peg Asset vs Stock Sale §1202 QSBS Estate Planning Business Valuation

About the author

Philip A. Baratelli, CPA, MBA — Founder, Baratelli Institute. Ponte Vedra Beach, Florida.

three decades in operating finance and M&A (a CPA since 1995). The guides in this library are the references he wished existed when he was doing the work.

Recommended path

Pick by the seat you sit in.

The rest of the route compounds on top of the desk reference.

These are reading paths, not bundles. Every Guide is sold individually on Gumroad — there is no discount, no package, no “buy three save X.” The dollar totals below simply add up the à-la-carte prices for the practitioner who follows the recommended path. Buy one and stop. Or buy the three that match your week. The Library is built to compose on the shelf, not to upsell at checkout.

If you buy one

By the seat you sit in

$99 — $349

For the CFO desk — CFO Guide. For PE / corp-dev / FO direct investing — PE Guide. For the M&A counsel scoping the engagement — LEP. For the trustee or trust officer — Trust Admin.

If you buy three

Desk + AI + adjacent specialty

~$547

Desk reference (above) — $349 (CFO or PE) or $149 (Trust) etc.
+ one of: Trust Admin ($149) · Estate Planning Decoded ($149) · LEP ($99)

AI Integration Decoded is the leverage layer under everything else. The third pick is the adjacent specialty — usually the one your largest client’s next matter touches.

The full route

Desk + everything that touches the desk

~$1,095

CFO Guide + PE Guide ($698)
+ LEP ($99) — the M&A layer
+ Trust Admin + Estate Planning Decoded ($298) — legacy infrastructure for the upstream client
+ Family Office Reference Guide ($349) — understand the seat you serve

The practitioner who buys the full route can speak fluently to the CFO, the GP, the family principal, the trustee, and the M&A counsel — on every matter type their firm handles.

✓ 30-day money-back guarantee

Walk into your next advisor, lender, or boardroom conversation already fluent in the numbers and the moves — a more informed partner to the professionals you work with, and clear-eyed on the cost of getting a big decision wrong. If it isn’t worth many times what you paid, take the refund.