Founded in 1992 by senior executives with entrepreneurial, line operating, and bulge bracket investment banking experience.
During the month of March 2010, Avalon, as the sole placement agent, raised Frederick's of Hollywood Group Inc. $3mm in common stock and warrants.
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Pari Passu
An equal sharing among different groups. If separate classes of preferred stock are structured to be pari passu with respect to liquidation preferences or dividends, on the sale of a company, all of the pari passu stockholders receive distributions in the same proportions as their relative liquidation preferences.
Participating Preferred Stock
Participating Preferred gives the holder, on sale or liquidation, the right to receive first an amount equal to the liquidation preference prior to any distribution to common stockholders and then any amount owed on an as-converted basis as a common stockholder.
Partnership
An ownership entity in which two or more partners are involved where personal taxes are levied on the partners' individual share of income from the partnership, whether recieved or not, but there is no taxation at the partnership, whether received or not, level. A partnership can be either a Limited Partnership or a General Partnership.
Pay to Play
A provision that requires a stockholder to participate in a subsequent offering in order to benefit from certain antidilution protections. This provision is used to prevent all investors from benefiting when only certain investors continue providing needed equity, particularly in companies with troubled economic circumstances. Generally, if the stockholder does not purchase his or her pro rata share in a later offering, the stockholder loses the benefit(s) and in extreme cases, may be required to convert to common stock, thereby losing the protective preferred stock provisions.
Payback Period
The length of time it takes to recover the initial cost of a project, without regard to the time value of money.
Piggyback Registration Rights
An investor's right to have restricted securities registered with the SEC and sold in connection with a public offering in which the issuer is selling the issuer's own securities or other investors are selling and issuer's securities.
Placement Agent
The broker-dealer who places securities in a private placement by arranging for the direct sale of a security to the purchaser. Unlike an underwriter, the placement agent does not purchase and then resell a security.
Pledging Receivables
The act of using accounts receivable as collateral for a loan.
Pooling of Interests
A method of accounting for mergers used prior to 2002. Under this method if certain technical requirements were present the financial statements of the companies were combined at their Book Values, the value of acquired assets was not restated and Goodwill was not created. The alternative was the Purchase Accounting method.
Post-Closing Adjustments
Post-closing adjustments represent increases or decreases to the sales price of a company based on amounts determinable only after the closing of the transaction. The acquisition agreement usually states expected post-closing adjustments and the method of calculating those adjustments.
Post-Closing Conditions
Conditions or events that occur after a transaction is completed. See also Post-Closing Adjustments and Earn Out.
Post-Money Value
The value of a company's equity immediately after a private securities offering. The post-money value is calculated by dividing the dollar amount invested in the securities by the percentage of the company owned by the new investors.
Pre-Money Value
The value of a company's equity capital stock immediately prior to a securities offering. Derived by subtracting the amount of new funds invested in the company's offering from the Post-Money Value.
Preemptive Rights
An investor's right to purchase the investor's pro rata (i.e., proportionate) share of any additional securities issued by a company.
Preferred Stock
A form of equity capital with attributes of both debt and equity, with variations including convertible preferred, redeemable preferred, and participating preferred. Preferred stock pays dividends like equity but like debt it has a priority over Common Stockholders in the payment of dividends and in the distribution of assets. Preferred stock usually has protective provisions, including affirmative and negative covenants, and the right to receive specified company financial and operating information.
Price/Book Ratio
A financial ratio in which a company's Market Value is divided by its reported Book Value.
Price/Cash Flow Ratio
A financial ratio in which a company's Market Value is divided by its cash flow from operations.
Price/Earnings Ratio
A financial ratio in which a company's Market Value is divided by its earnings.
Price/Sales Ratio
A financial ratio in which a company's Market Value is divided by its sales.
Primary Offering
A sale of securities directly by a company from stock that was previously unissued. An Initial Public Offering (IPO) is frequently referred to as primary offering, even though it may involve the sale of securities by stockholders.
Prime Rate
The interest rate at which banks lend to their best customers.
Private Placement
A non-public distribution of securities in an offering that is exempt from the registration requirements of the Securities Act, usually to a limited number of sophisticated investors. Rule 506 Offerings are private placements that can be sold to an unlimited number of Accredited Investors.
Privately-Held Company
A company that has not sold any securities in a public offering, or otherwise become subject to the reporting requirements of the Securities Exchange Act. Businesses that have sold securities in a private placement generally remain private as long as there are limited number of outside securities holders.
Pro Forma Financial Statements
Financial statements as adjusted to reflect a projected or planned transaction.
Profit Margin
Determined by dividing Net Income by net sales and is expressed as a percentage.
Prospectus
The disclosure section of a registration statement that is delivered to Investors in a public offering. The prospectus contains SEC-mandated narrative and financial information.
Public Company
A company that is subject to the reporting requirements of the 1934 Act by selling securities to the public in an Initial Public Offering or other offering. The 1934 Act governs the trading in the securities of a public company.
Public Company Comparable Analysis
A market-based valuation methodology in which current share prices of similar publicly traded companies are analyzed to determine the value of a private company. The method derives multiples, such as Price to Sales, Price to EBITDA and Price to EBIT, and then adjusts them for the differences in company size and private and public markets.
Public Float
The amount of common stock of a public company that is actually available for active trading in the public market. The calculation of public float normally excludes securities that cannot be sold by agreement with the security holder plus securities held by controlling shareholders or significant holdings by officers, directors and company affiliates.
Public Offering
A securities offering that has been registered with the Securities and Exchange Commission and is sold to the public usually by an Underwriting Syndicate.
Purchase Accounting
A Merger accounting method where the acquired assets and assumed liabilities of the acquired entity are written up or down to their respective fair market values as if purchased by the acquirer. The difference between the purchase price and the net assets acquired is classified as Goodwill. Alternatively see Pooling of Interest.
Purchase Price
The price paid for a security or asset. For preferred stock, the liquidation preference is generally equal to the purchase price plus any unpaid accumulated dividends.
Put Rights
The right (but not the obligation) of a put holder to force the purchase of specific securities owned by the put holder. The put is usually at a designated time or period or upon a specified occurrence. The put price either is a fixed price or is set pursuant to an agreed pricing formula. A put right is the opposite of a Call Rights.
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