B04 - RFP IDIQ SOW-OII Valuation Svcs v2 9-6-23.pdf

Sol. Number 73351023R0027

Document Title

Independent Valuation Consulting Services

Page

INDEFINITE DELIVERY/INDEFINITE QUANTITY (IDIQ) SOLICITATION

Small Business Administration Acquisition Division, on behalf of the Office of Investment and Innovation (OII)

SBA Project Name: OII Independent Valuation Consulting Services

Issued to

NAICS: 541611- Administrative Management and General Management Consulting Services

Product Service Code (PSC) of R499 - Support- Professional: Other

Important Due Dates:

RFP issued on: September 6, 2023

Questions by: September 8, 2023 @ 1:00 p.m. ET

RFP Responses due: September 15, 2023 @ 1:00 p.m. ET

Performance begins: Estimated September 21, 2023

This is a notice that the resultant contract is for a 100% Total Small Business set-aside requirement.

Only quotations submitted by Small Business will be accepted by the Government. Any quotation that is submitted by an Offeror that is NOT a Small Business will not be accepted.

Document Title

Independent Valuation Consulting Services

SECTION A – IDIQ PWS, GENERAL TERMS AND CONDITIONS

1.0 Background

The SBIC program was created to stimulate and supplement the flow of private capital to small business concerns (SBCs). It does this by licensing teams of experienced private equity fund managers who seek eligible SBCs to make loan, debt and/or equity investments. Most SBICs are licensed with the expectation that they will receive financial assistance from SBA in the form of SBA-guaranteed debentures (“leveraged

SBICs”) and some are licensed with the understanding that they will not receive financial assistance from

SBA. This PWS is focused on leveraged SBICs.

The SBICs’ general partners (or board of directors in the case of a corporate SBIC) are responsible for adopting an SBA-approved valuation policy and preparing valuation reports on investments held by the

SBICs in accordance with that SBA-approved valuation policy. Most general partners (or board of directors) adopt the SBA Valuation Guidelines. The general partners (or board of directors) are responsible for assigning a value to each of the SBIC’s investments and preparing and approving valuation reports. The valuations and valuation reports must conform to the SBIC’s SBA-approved valuation policy adopted by the SBIC. The Investment Portfolio Management Division (IPM), within OII, is responsible for the financial and regulatory oversight of SBICs in active operations. As part of its financial oversight of leveraged SBICs, IPM may, at times, need an independent third-party professional to perform valuations of

SBIC investments to ensure that the valuations prepared by the general partners (or board of directors) comply with the SBIC’s SBA-approved valuation policy. For leveraged SBICs, such valuations may be critically important for IPM in performing its oversight responsibilities appropriately.

Proper valuation of investments is a key component in OII’s assessment of the financial condition of leveraged SBICs. This assessment can have significant impact for the purposes of:

1. Determination of an SBIC’s regulatory compliance,

2. Approval or denial of SBIC leverage commitment applications; and

3. Approval or denial of SBIC leverage draw requests.

In addition, in certain circumstances, IPM relies upon valuation reports from independent third-party professionals to calculate a leveraged SBICs’ capital impairment percentage (CIP), which is a regulatory mandated measurement for determining an SBIC’s financial condition, see CFR 13, Section 107.1830 and

1840 for the definition and computation of CIP. CIP measures the extent to which both operating losses and investment losses of an SBIC (both realized and unrealized) have eroded the SBIC’s private capital commitments. A CIP above an SBIC’s maximum permissible percentage triggers an event of default that requires SBA to transfer the SBIC to the Office of Liquidation (OL) for recovery to minimize losses.

OII has acquired contracted independent third-party valuation expertise to support IPM oversight needs in the past. This is the fourth such acquisition.

Recently, the U.S. Small Business Administration (SBA) and the U.S. Department of Defense (DoD) announced a new joint effort to establish the Small Business Investment Company Critical Technologies

Initiative (SBICCT), designed to grow investment in critical technologies vital to U.S. national security.

This new partnership will support the Biden-Harris Administration’s whole-of-government effort to bolster

America’s leadership in global innovation and to strengthen our national security by incubating and scaling technologies. See link: Biden-Harris Administration Announces Groundbreaking Joint Initiative to Drive

Investment to Entrepreneurs Scaling Critical and Emerging Technologies | U.S. Small Business

Administration (sba.gov).

https://www.sba.gov/document/policy-guidance--appendix-15-valuation-guidelines-sbics http://www.sba.gov/ https://www.sba.gov/article/2022/dec/03/biden-harris-administration-announces-groundbreaking-joint-initiative-drive-investment-entrepreneurs https://www.sba.gov/article/2022/dec/03/biden-harris-administration-announces-groundbreaking-joint-initiative-drive-investment-entrepreneurs https://www.sba.gov/article/2022/dec/03/biden-harris-administration-announces-groundbreaking-joint-initiative-drive-investment-entrepreneurs

Document Title

Independent Valuation Consulting Services

Two new SBICs, Accrual SBICs and Reinvestor (Fund-of-Funds) SBICs have been created, see link Apply to be an SBIC | U.S. Small Business Administration (sba.gov). Additionally, the U.S. Department of

Defense (DoD) established the Office of Strategic Capital (OSC) and together SBA and DoD created a

Memorandum of Understanding with SBA’s Office of Investment and Innovation (OII). See link SBA and

DoD to Sign Joint Agreement to Drive Investment to U.S. Critical Technologies at South by Southwest

Festival in Austin on Friday | U.S. Small Business Administration.

2.0 Overall Objective

The objective of this contract is primarily two-fold, 1) to obtain third-party expertise valuations to OII and

2) independent risk assessments, initially on SBIC applicants to help inform OII of the potential risk of awarding an SBIC license and leverage to an applicant who becomes an SBA licensed SBIC.

The third-party valuations more specifically are to (i) assess if SBICs are adhering to the SBA Valuation

Guidelines or SBA-approved valuation policy, (ii) assess the earnings capacity of SBCs to determine repayment ability of SBIC debt investments, (iii) assess the likelihood of recovery of SBIC debt investments in distressed SBCs, (iv) determine the value of equity securities, (v) assess an SBCs value at the time of a projected sale, and/or (vi) provide professional accounting guidance on SBICs reporting to

SBA and interpretation of handling relevant accounting issues related to SBICs, e.g. using GAAP, SBIC

Regulations, Federal and State Tax issues. Contracted expertise provided to OII in an advisory capacity will also contribute to the training and development of needs of OII staff and overall program management (if needed) as it relates to valuation analysis.

The two primary intents of this contract are for OII to obtain 1) high-quality, professional, objective, and thorough written valuation analyses to confirm the valuations of SBIC investments on an as needed basis and 2) high-quality risk assessments on SBIC applicants, especially for the two new SBIC types, the

Accrual SBIC and the Reinvestor (Fund-of-Funds) SBIC. See the link: SBA Administrator Guzman

Announces Implementation of Transformational Public-Private Investment Program Reforms | U.S. Small

Business Administration. A very important aspect of these new SBIC types is the new Small Business

Investment Company Critical Technologies (SBICCT) Initiative SBA has entered into with the U.S.

Department of Defense (DoD). See link SBA and DoD to Sign Joint Agreement to Drive Investment to

U.S. Critical Technologies at South by Southwest Festival in Austin on Friday | U.S. Small Business

Administration.

The SBC investments requiring valuations will be identified by OII. The independent third-party valuations will allow OII to determine appropriate courses of action based on verified information in a timely manner as part of SBA’s risk mitigation oversight strategy. Access to valuation experts in an advisory capacity will assist OII in general program management as needed in the areas of policy development, risk mitigation, and staff training and development.

Similarly, OII will identify specific SBIC applicants to have risk assessments performed as further defined below in Tasks 6, 7, 8 which are categorized as base, intermediate and high-risk assessments respectively.

These will be better defined during an initial Special Purpose Task 9 which will be engaged to clearly outline the Task 6. 7 and 8 engagement expectations. The Special Purpose Task 9 can also be used as needed by OII, as defined, agreed upon and approved in writing by SBA before any effort is undertaken by an awardee of this solicitation.

https://www.sba.gov/partners/sbics/apply-be-sbic#id-types-of-sbics https://www.sba.gov/partners/sbics/apply-be-sbic#id-types-of-sbics https://www.sba.gov/about-sba/sba-locations/headquarters-offices/office-investment-innovation https://www.sba.gov/article/2023/mar/07/sba-dod-sign-joint-agreement-drive-investment-us-critical-technologies-south-southwest-festival https://www.sba.gov/article/2023/mar/07/sba-dod-sign-joint-agreement-drive-investment-us-critical-technologies-south-southwest-festival https://www.sba.gov/article/2023/mar/07/sba-dod-sign-joint-agreement-drive-investment-us-critical-technologies-south-southwest-festival https://www.sba.gov/document/policy-guidance--appendix-15-valuation-guidelines-sbics https://www.sba.gov/document/policy-guidance--appendix-15-valuation-guidelines-sbics https://www.sba.gov/article/2023/08/18/sba-administrator-guzman-announces-implementation-transformational-public-private-investment-program https://www.sba.gov/article/2023/08/18/sba-administrator-guzman-announces-implementation-transformational-public-private-investment-program https://www.sba.gov/article/2023/08/18/sba-administrator-guzman-announces-implementation-transformational-public-private-investment-program https://www.sba.gov/article/2023/mar/07/sba-dod-sign-joint-agreement-drive-investment-us-critical-technologies-south-southwest-festival https://www.sba.gov/article/2023/mar/07/sba-dod-sign-joint-agreement-drive-investment-us-critical-technologies-south-southwest-festival https://www.sba.gov/article/2023/mar/07/sba-dod-sign-joint-agreement-drive-investment-us-critical-technologies-south-southwest-festival

Document Title

Independent Valuation Consulting Services

This solicitation is to help minimize the risk and cost to the federal government for this new initiative between SBA and DoD as well as the risk and cost to SBA’s OII overall, primarily but not exclusively to the SBIC program.

3.0 Performance Standards

Consistent with the requirements of the Small Business Investment Act of 1958, as amended, OII seeks to ensure that loans and investments made by SBICs are of such sound value, or so secured, as to reasonably assure repayment. OII seeks one or more qualified small business valuation contractor(s) (“Contractor”) capable of designing and conducting evaluations and assessments on SBCs. The Contractor will help develop overall valuation frameworks and will suggest new or clarify existing measures and metrics. Work may include recommending updates to the current SBA Valuation Guidelines for SBICs and provide analyses for the proposed work detailed in this PWS. The assessments could include portfolio analysis and best practice identification across the private equity industry.

The Contractor shall perform “Valuations” on SBCs as directed by SBA through a written request. These

Valuations will be either a Valuation Engagement (Task 2 in Section 4.0) or a Calculation Engagement

(Task 1in Section 4.0), or both (combined)(Task 3 in Section 4.0).

- The Valuation Engagement(s) (Tasks 2 and 3 in Section 4.0) shall be performed in accordance with the professional standards of one or more business valuation professional organizations, (NACVA, AICPA, ASA) and adhere to the quality standards set by Uniform Standards of Professional

Appraisal Practice (USPAP)

- The Calculation Engagement shall be a professional application of the SBA Valuation Guidelines and the SBIC’s SBA approved valuation policy.

The reports must be submitted pursuant to the time frames listed in the specific tasks listed below unless agreed in writing by SBA.

OII also seeks one or more qualified and experienced risk assessment contractor(s) (“Contractor”) capable of designing and conducting evaluations and assessments on SBCs.

Performance Standards for Risk Assessments, Tasks 6. 7 and 8 below will be according to the criteria noted in these task descriptions and as agreed upon in writing during the initial Task 9 – Special Purpose risk assessment. The final standards for these risk assessments must be approved in writing by OII prior to the first Task 6, 7 and/or 8 as they may deviate from the example provided primarily due to the unique aspects of the SBIC program, the new SBIC types, Accrual SBIC and the Reinvestor (Fund-of-Funds) SBIC as well as SBA’s partnership with DoD and SBICCT .

4.0 Specific Tasks

Task 1 – Calculation of Value: The Contractor shall perform a calculation of value engagement based on the information required by SBA to support the valuation of the subject SBC submitted by the SBIC in their regular financial filings. The purpose of the Calculation of Value is for the Contractor to provide their written opinion on whether or not the following are met:

1. the SBIC is adhering to the SBA Valuation Guidelines and the SBIC’s SBA approved valuation policy;

2. the valuation provided to the SBA by the SBIC is within an acceptable range based on information provided to the Contractor;

3. the economic outlook in general and the condition and outlook of the specific industry in particular support the valuation of the SBC provided by the SBIC to SBA.

https://www.sba.gov/document/policy-guidance--appendix-15-valuation-guidelines-sbics https://www.sba.gov/document/policy-guidance--appendix-15-valuation-guidelines-sbics

Document Title

Independent Valuation Consulting Services

The contractor’s report must lead with its conclusion and opinion on whether or not the SBIC was in compliance with the SBIC’s valuation policy approved by SBA.

Note: The calculation of value should be delivered within one week after receiving all the information required to develop their final written report.

The Contractor shall prepare a valuation report (Report) for each SBC that must be coherent, supportable, and understandable. The Report must include a section that provides an assessment of the valuation prepared by the SBIC’s general partner (or board of directors) as to conformity with the SBA Valuation

Guidelines or the SBIC’s approved valuation policy and addresses areas where the SBIC’s general partner’s

(or board of directors’) valuation report does not conform to the SBA Valuation Guidelines or the SBIC’s

SBA-approved valuation policy and provides an analysis demonstrating how the deviation affected the result. A table of contents must be included to ensure easy access to relevant areas of this report.

Task 2 – Independent Valuation

These valuations must be according to professional standards of at least one of the following business valuations accrediting bodies: the National Association of Certified Valuators and Analysts (NACVA), AICPA’s ABV certification and/or American Society of Appraisers Accredited Member (AM) and

Accredited Senior Appraiser (ASA) in Business Valuations (BV). Additionally, if there is any deviation from Generally Accepted Accounting Standards (GAAP) these should be clearly identified.

The earnings capacity of the SBC(s) to determine the repayment ability of SBC to the SBIC and, as requested by SBA, the recovery of SBIC debt investments must be addressed in the report. The value of equity investments should consider industry and economic outlooks, company projections, and other factors as deemed applicable by the Contractor. Who created the financial projections, their corporate affiliation, title and, if available their background and reason (experience) for their providing the projections should be clearly identified in the summary conclusion in the front of the report. If the Officers and Directors of the

SBC did not create the financial projections an explanation of why they did not should be included in the summary conclusion. It should be cited as to whether or not the relevant SBC’s Officers and Directors certify as to their projections.

The valuation report(s) must lead with the summary conclusion, Enterprise Value (EV) and include a value waterfall.

The Contractor shall prepare a valuation report (Report) for each SBC that must be coherent, supportable, and understandable. A table of contents must be included to ensure easy access to relevant areas of this report.

Task 3 – Combined Independent Valuation and Calculation of Value:

This valuation report includes both Task 1 and Task 2, a Calculation of Value and an Independent Valuation.

Task 4 - Special Purpose, Valuation and/or Accounting and Training Services:

The Contractor shall provide a level of special purpose reports, valuation, and accounting support to answer questions as needed. These can be general and/or specific advice/reports in the area of valuations of investments made by SBICs, compensation surveys for work performed or expected to be performed and accounting services as requested in writing by the TPOC or COR. For instance, the request may include accounting issues related to SBIC regulations, GAAP, SBIC reporting and other SBIC related items, e.g.

how to coach SBICs on how to report a special circumstance to SBA or how a transaction may be properly

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Independent Valuation Consulting Services reported in a financial statement. These hourly rates can be used for special purposes and/or training as determined in writing by SBA. The labor categories have been identified in Paragraph 18.0 Key Personnel.

Task 5 - SBC Method Assessment (SMA): Provide expert guidance to OII, to an SBIC Examiner, Investment Analyst, or other OII designated person to determine whether or not the valuation methodology used by an SBIC, according to the contractor SME, reasonably follows SBA’s SBIC Valuation Guidelines.

The expectation is upon obtaining the needed information from SBA, e.g., all documents most recently filed with SBA supporting the valuation of the subject investment, the contractor will respond within a week of the request or on an alternate date mutually agreed upon after discussion with our COR/TPOC. Included in this task, if requested by an examiner, Investment analyst, exam manager and/or the TPOC, the SME will make themselves available for a discussion, in addition to the written SBA up to 1 hour at no additional charge. If over an hour, then at the approved hourly rate or an amount mutually agreed upon in writing can be charged. The intent is for the contractor (their SME) to provide both the written and, if needed, verbal feedback after SBA’s receipt and review of the SMA report. This SMA is to be a fixed price for each investment (Small Business Concern – SBC) requested by SBA/OII.

Background for Tasks 6 through 9: Risk Assessment related to SBICs:

Brand name or equivalent: Risk Assessments initially based on characteristics similar to Mercer Sentinel

Services, adapted for SBICs, which include:

• Custody provider service evaluation, fee benchmarking, securities lending assessments and custodian and independent fiduciary searches

• Asset transition consulting, transition coordination and transition manager search/evaluation

• Foreign exchange and equity transaction cost analysis (TCA)

• Operational risk assessments, surveys, and consulting

• Investment risk management and governance consulting

Investment Management

• Manager selection

• Research

• Investment policy

• Investment management

• Portfolio construction

Complete approach:

Maximize returns reduce risk

Risk and cost management

• Counterparty and service provider risk and cost

• Transaction risk and cost

• Operational risk

Each Task 6, 7, 8 and 9, Base, Intermediate, High and Special Purpose, respectively can be designed and performed for both Operational and Investment Risk Due Diligences (ODDs and IDDs) for any type of

SBIC. These risk assessments are expected to be for applicants to become SBICs, not existing SBICs.

However, SBA has the authority to modify the contract to perform these services on existing SBICs.

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Independent Valuation Consulting Services

Task 6 Base Risk Assessment– Lower cost option to identify potential issues needing further investigation.

This can be performed for operational and/or investment due diligence. Clarification and mutual understanding of this risk assessment criteria will be initially completed with an engagement Task 9 -

Special Purpose performed on an hourly basis with hours mutually agreed upon in writing prior to any hours being incurred. The written report will include written support for each core function and a final rating.

As requested in writing by the TPOC or COR, conduct due diligence to assess operational and/or investment risks of candidates to be licensed as SBICs (applicants), currently licensed SBICs, their asset managers, custodians and other service providers as requested. Review internal operations and review asset managers investment strategies, structure, resources, policies, systems and other essentials to determine capability to deliver results and minimize risk to the SBA and their government affiliations. Examples of written reports must meet or exceed the standards outlined by Mercer Sentinel in their Operational Risk

Surveys (ORS). These reports will include Investment Due Diligence (IDD) and/or Operation Due

Diligence (ODD), plus a wrapper (a final rating) on identified SBIC applicants, actual SBICs and their management companies. These ratings and reports will be available to the subject SBIC and their potential investors.

Brand name or equivalent: Risk Assessments initially based on characteristics similar to Mercer Sentinel

Services’ Operational Risk Surveys (ORS), tailored to the unique aspects of SBICs, see Task 9.

Core areas to address for each SBIC, applicant or existing, in written detail include:

Manager(s) Name

Governance

Organization

Control

Technology

Risk and private equity implementation

Administration

Fund Structure

Total Score, Final Rating

Task 7– Intermediate Risk Assessment

A review of existing documents to determine suitability for the applicant SBIC to perform as presented.

This will include a red flag report delivered within three to four weeks of assignment. This can be done for operational and/or investment due diligence. Clarification and mutual understanding of this risk assessment will be initially completed with an engagement Task 9 - Special Purpose performed on an hourly basis with hours mutually agreed upon in writing prior to any hours being incurred. The written report will include written support for each core function and a final rating.

As determined by OII and requested in writing by the TPOC or COR, obtain proposals and if agreed upon in writing by SBA, conduct due diligence to assess operational and/or investment risks of candidates to be licensed as SBICs (applicants), currently licensed SBICs, their asset managers, custodians and other service providers as requested. Review internal operations and review asset managers investment strategies, structure, resources, policies, systems, and other essentials to determine capability to deliver results and minimize risk to the SBA and their government affiliations. Examples of written reports must meet or exceed the standards outlined by Mercer Sentinel in their Operational Review (OR). These reports will include Investment Due Diligence (IDD) and/or Operation Due Diligence (ODD), plus a wrapper (a final

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Independent Valuation Consulting Services rating) on identified SBIC applicants, actual SBICs and their management companies. These ratings and reports will be available to the subject SBIC and their potential investors.

Brand name or equivalent: Risk Assessments initially based on characteristics similar to Mercer Sentinel

Services Operational Review (OR), tailored to the unique aspects of SBICs, see Task 9.

Core areas to address for each SBIC, applicant or existing, in written detail include:

Governance Structure

Organizational Structure & Human Capital

Fund Structure

Regulation, Compliance & Audit

Valuation Methodology & Process

Accounting, Systems & Reporting

Cash Management

Fund Expenses

Technology & Business Continuity/Disaster Recovery

Third Party Relationships

Task 8 – High Risk Assessment

This is an in-depth assessment across all operational areas to ensure all significant risks are captured for an applicant SBIC. This detailed report also provides a holistic view. OII expects this High Risk Assessment will be the most frequently used, possibly for all serious applicants. This report is expected to delivered within eight to nine weeks of assignment. This risk assessment can be done for operational and investment due diligence. Clarification and mutual understanding of this risk assessment will be initially completed with an engagement Task 9 - Special Purpose performed on an hourly basis with hours mutually agreed upon in writing prior to any hours being incurred. The written report will include written support for each core function and a final rating.

As determined by OII and requested in writing by the TPOC or COR, conduct due diligence to assess operational and/or investment risks of candidates to be licensed as SBICs (applicants), currently licensed

SBICs, their asset managers, custodians and other service providers as requested. Review internal operations and review asset managers investment strategies, structure, resources, policies, systems and other essentials to determine capability to deliver results as projected by SBIC applicant and minimize risk to the

SBA and their government affiliations. Examples of written reports must meet or exceed the standards outlined by Mercer Sentinel in their Operational Risk Assessment (ORA). These reports will include

Investment Due Diligence (IDD) and Operation Due Diligence (ODD), plus a wrapper (a final rating) on identified SBIC applicants, actual SBICs and their management companies. These ratings and reports will be available to the subject SBIC and their potential investors.

Brand name or equivalent: Risk assessments will be based on characteristics similar to Mercer Sentinel

Services Operational Risk Assessment (ORA), tailored to the unique aspects of SBICs, see Task 9.

Core areas to address for each SBIC applicant or licensed assigned, include assessments of all 11 core factors below including, Social, Environmental and Governance and/or Critical Technology as defined by

DoD. Expectation is 50 to 80 hours of work delivered in eight to nine weeks.

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Independent Valuation Consulting Services

Example of Core Function Example of Function Score

Governance and Organizational

Structure

Meets standards

Human Capital Meets standards

Fund Structures Development required

Regulation, Compliance and Audit Meets standards

Risk Control Meets standards

Transaction Execution & Private

Equity Implementation

Meets standards

Public & Private Equity Valuation and

Administration

Meets standards

Technology Meets standards

Business Continuity and Disaster

Recovery

Meets standards

Third Party Relationships Meets standards

Environmental, Social and

Governance and/or DoD Critical

Technology

Limited

Task 9 – Special Purpose Risk Assessment:

As mutually agreed, upon by SBA and awardee, approved in writing by SBA as to the hours and scope.

The initial expectation is this will ensure agreement as to the extent, deliverables, depth of due diligence and deadlines for each risk assessment Tasks 6 (base), 7 (intermediate), 8 (high) as requested by SBA and tailored to the SBIC type. These Special Purpose Risk Assessments can be developed for other efforts, outside of Tasks 6. 7 and 8 related to applicant SBICs, existing SBICs or other work defined in writing by

OII prior to the initiation of any effort by an awardee.

Task 10 – Databases and related services

Make available to OII, database(s), surveys or other services to help inform OII personnel on how to better manage the SBIC program:

This Task could also include data bases to support valuations of private equities, legal exposure, compensation surveys or other needs to oversee private equity firms, examples include: Pitchbook

(www.pitchbook.com), Preqin (www.preqin.com), LexisNexis (www.lexisnexis.com) as well as others. If

SBA elects to pursue these purchases, the contractor must be able to deliver them.

Characteristics for Pitchbook Services include:

Pitchbook provides research and analyzes companies, deals, funds, investors, and service providers across the entire private investment lifecycle.

Provider of data, research, and analysis on private and public companies. The company specializes in researching global M&A, private equity, and venture capital investments along with all participating parties, including limited partners, investors, service providers and the professionals involved. PitchBook provides the investment community with a proprietary data platform, research tools and custom analysis to enable better investment decisions. Data is collected through the company's extensive research process that includes machine-learning and natural language processing technology, comprehensive review of publicly available sources, direct primary research with all parties involved in deal flow, online surveys, and http://www.pitchbook.com/ http://www.preqin.com/

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Independent Valuation Consulting Services ongoing quality assurance. In addition to the PitchBook Platform, the company also publishes a daily newsletter and quarterly reports detailing key industry activities and trends.

• Market Update – Provides charts on the current financial market status. This is part of the pitchbook which covers topics aimed at convincing clients that now is the right time to make the deal.

• Credentials – Numerous biographies and league tables that show why the current bank is the right choice.

• Deal Outline – Gives a sense of what the deal would involve. It also provides other options to consider.

• Considerations – Holds charts and tables exhibiting effects on EPS and any other potential problems. Bear in mind to read the footnotes in this section as potential problems are normally referred to as “execution” or “management”.

• Appendix –Though the epilogue, is a very important section as it comprises the current as well as future models and their effects.

Characteristics for Prequin Services include:

Preqin provides data on fundraising, investors, performance, dry powder, AUM, and deal flow, as well as information on compensation, fund terms and employment. It publishes research reports that draw from its data and include contributions from alternative investment professionals, as well as Preqin subject experts.

Preqin gives indispensable data, analytics, and insights for alternative assets professionals around the globe.

Characteristics for Lexisnexis Services include:

LexisNexis is a legal research tool or its equivalent.

Task 11 – Peer Review

If determined and approved by SBA in writing before any work is performed, a peer review of a specific valuation, Tasks 1, 2 or 3 and/or risk assessments of Task 6, 7, 8 and 9 may be requested.

5.0 Deliverables

a. All reports listed below will be provided to COR/TPOC in an email and uploaded to a technology platform e.g., OneDrive, Salesforce and/or SharePoint as required by the TPOC. The Contractor shall produce the final Report for each SBC appraised containing the features outlined in Task 2 (Independent

Valuation) and Task 3 (Combined Valuation) Section 4.0 within 30 days after the Contractor receives the necessary SBC information. Tasks 1 (Calculation of Value) and Task 5 (SMA) final report should be delivered within one week of getting the necessary documents unless otherwise mutually agreed upon in writing. Final Report for Task 4 is to be delivered at a mutually agreed upon date. While it is acknowledged that there may be required form elements that must appear in the Report, the Contractor is expected to give evidence of having considered the unique characteristics of both the SBIC and the SBC so that the report is less a generic document and more an individualized engagement. Further, all valuation inputs, assumptions and definitions of terms must be clearly articulated in a separate section of the report.

Deliverable Title Task Reference Due Date Medium/Format Recipient

Calculation of Value

Report

Task 1 1 week after receipt of necessary documents

SharePoint/PDF COR/TPOC

Independent

Valuation

Task 2 Within 30 days after receipt of necessary documents, unless

SharePoint/PDF COR/TPOC

Document Title

Independent Valuation Consulting Services amended and approved in writing by SBA

Combined

Independent Valuation and Calculation of

Value

Task 3 Within 30 days after receipt of necessary documents, unless amended and approved in writing by SBA

SharePoint/PDF COR/TPOC

Special Purpose, Valuation and/or

Accounting and

Training Services

Task 4 Within 30 days after receipt of necessary documents, unless amended and approved in writing by SBA

SharePoint/PDF COR/TPOC

SBC Method

Assessment (SMA)

Task 5 Within 5 days after receipt of necessary documents, unless amended and approved in writing by SBA

SharePoint/PDF COR/TPOC

Base Risk Assessment Task 6 Delivery dependent on scope of assignment, in writing mutually agreed upon

SharePoint/PDF COR/TPOC

Intermediate Risk

Assessment

Task 7 Within 3 weeks after assignment

SharePoint/PDF COR/TPOC

High Risk Assessment Task 8 Within 9 weeks after assignment

SharePoint/PDF COR/TPOC

Special Purpose Risk

Assessment

Task 9 Delivery dependent on scope of assignment, in writing mutually agreed upon

SharePoint/PDF COR/TPOC

Databases and related services

Task 10 After initial delivery of access to database, immediate access. If issues with Database, resolved within 24 to

48 hours maximum.

SharePoint/PDF COR/TPOC

Peer Review Task 11 Delivery dependent on scope of assignment, in writing mutually agreed upon

SharePoint/PDF COR/TPOC

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Independent Valuation Consulting Services

b. The Contractor shall include in the Reports for Tasks 1,3 and 5 a separate section containing a conclusion for the SBC appraised as the Contractor believes it should be reported under the SBIC Valuation

Guidelines or the SBIC’s SBA-approved valuation policy, as appropriate. The Contractor shall discuss the assumptions behind its conclusions and explain why its findings differ from the SBIC’s conclusion, if indeed it does. The report must lead with a summary and conclusion. The Contractor shall include in the

Report the conclusion(s) of the Valuation Engagement and/or the Calculation Engagement. If the two engagements result in different conclusions, there should be a discussion section indicating what factors led to the different conclusions.

c. Tasks 2 and 3 which include Independent Valuations must be performed pursuant to the professional standards requirements for the acceptable organizations outlined in Section 3.0 of this request and cite the organizational standards used in the submitted report.

d. The Contractor shall prepare interim status reports on a monthly basis identifying the current status of tasks performed under the contract, date assigned, any problems or concerns, completion or expected completion date. The Contractor shall deliver these reports in Microsoft Word via email within 7 calendar days after the end of each month to the SBA’s Technical Point of Contact (TPOC).

In addition to a Contracting Officer (CO), both a Contracting Officer Representing (COR) and a Technical

Point of Contact (TPOC) will be assigned by the SBA to this contract once the award is made.

6.0 Travel

Travel under any Task will be pursuant to the reimbursement schedule allowed by the Code of Federal

Regulations for the Federal Travel Regulation System for federal employees. Should travel be required, all travel must be preapproved in writing by the COR and shall adhere to FAR 31.205-46 (31.205-46 Travel costs. | Acquisition.GOV).

7.0 Other Direct Costs

Other Direct Costs (ODCs) may be required at the task order level and will be identified on a separate

CLIN.

8.0 Items/Services Being Acquired/Total Price

The Contractor shall provide the Office of Investment and Innovation (OII) Independent Valuation

Consulting Services. The Contractor shall furnish all personnel, facilities, equipment, materials, supplies, and services (except as may be expressly set forth in this indefinite delivery/indefinite quantity (IDIQ) contract or any task order (TO) against this IDIQ contract as furnished by the agency) and performance of these requirements in accordance with the Performance Work Statement (PWS) of this IDIQ contract and all subsequent TOs and respective modifications issued against this IDIQ contract.

IDIQ Ceiling: $10,000,000.00

IDIQ minimum: $45,000.00.

IDIQ Call Limit: There is No Minimum or Maximum number of calls that can be issued.

https://www.acquisition.gov/far/31.205-46 https://www.acquisition.gov/far/31.205-46

Document Title

Independent Valuation Consulting Services

14.0 Ordering Procedures

Authorized Contracting Officer.

Any warranted Contracting Officer assigned under the SBA Office of Finance Operations and Acquisition

Management (OFOAM) may award task orders and respective modifications against this IDIQ contract.

Contractor Point of Contact. The Contractor shall immediately notify the Contracting Officer in the event of any changes to Contractor POC information, Contractor physical address, Contractor web address, or any other relevant information concerning ordering.

Size Recertification. The IDIQ holder may be required to certify to size standards prior to exercise of the

IDIQ option periods or prior to the award of the orders.

Frequency of Ordering. Orders may be awarded or modified as needs arise during the 60-month ordering period. Delivery Locations and Schedule.

Method for Pricing Orders. All labor categories listed in the contractor’s Attachment 1-Pricing Sheet are considered to be within the scope of this IDIQ. Pricing for additional services or service elements within scope of the description provided in section 4 may be requested, negotiated, and agreed to by both parties

(Government and Contractor), and awarded via a modification to this IDIQ or any order against this IDIQ by the Contracting Officer.

Method for Placing Orders. Any services to be furnished under this Contract shall be ordered through the

SBA CO by issuance of a Task Order Request for Proposal (TO-RFP). Such orders may be issued at any time during the effective period of the Contract. The government will determine which pricing type to utilize for each order. This will be determined on a task-by-task basis. All orders placed against this

Contract shall be either Time and Material, Labor Hour with fixed labor rates, or Firm Fixed Price.

Each order will be initiated by an authorized CO or Contract Specialist through a TO-RFP requesting a technical and price proposal/quote from the Contractor for the services described in the task work statement. Individual orders will be competed amongst IDIQ vendors unless an exception to fair opportunity exists.

In accordance with FAR 16.505(b)(1)(ii), if the order does not exceed the simplified acquisition threshold, the contracting officer need not contact each of the multiple awardees under the contract before selecting an order awardee if the contracting officer has information available to ensure that each awardee is provided a fair opportunity to be considered for each order.

The solicitation process will be conducted via email. The proposal request will set forth the government’s specific requirements, a detailed description of the services required, labor categories required (if applicable), work location, delivery date or period of performance, report deliverables, and the due date for proposal submission(s). The proposal request will also include specific instructions for proposal submissions. The IDIQ holder may be required to provide resumes for all or a portion of quoted personnel for orders. SBA will ensure that adequate time is provided to prepare and submit responses. The CO will determine the appropriate amount of time based on the estimated dollar value and complexity of the proposed delivery order. Proposal/Quote submissions must be valid for a period of 60 days.

Document Title

Independent Valuation Consulting Services

In accordance with FAR clause 52.216-22 Indefinite Quantity the period of performance of an order may extend past the IDIQ contract’s end date for a period not to exceed one (1) year.

All orders under this contract shall be performed in accordance with the work statement for the contract and contractual terms and conditions. All orders shall use the rates established herein. Offerors will be encouraged to apply additional discounts to contract rates to maintain competitiveness during task order competitions.

The government does not anticipate large volumes of documentation in response to a TO-RFP and will identify page limitations in each solicitation. Each TO-RFP will identify a schedule of events to include a period for questions and answers, proposal submission date, a period for government evaluation, and negotiation between the Contractor and government, if necessary. Funding for the task will be provided at time of task award.

All orders are subject to the terms and conditions of this contract. In the event of conflict between an order and this base contract, the base contract shall take precedence.

Fair Opportunity Ordering

Individual orders will describe services to be performed so that the full price for the performance of the work can be established when the order is placed. Orders will be within the scope of the contract, will be issued within the period of performance, will be within the maximum value of the contract, and will follow the fair opportunity process as described below.

Orders may be issued any time during the term of the contract or any extension. All orders issued before the end of the contract term shall be honored and performed by the contractor, following the terms and conditions of the contract. All orders are subject to the terms and conditions of this contract. In the event of a conflict between an order and this contract, the contract shall prevail.

14.0.1 Fair Opportunity Process

The following fair opportunity process will be utilized in placing orders against this contact in order to provide all contractors, a fair opportunity to be considered for an order.

The fair opportunity process described in the Federal Acquisition Regulation (FAR) 16.505(b) applies to this contract. The government will provide a fair opportunity to all awardees, except as provided for in the section below, Exceptions to Fair Opportunity.

The government reserves the right to modify this process and will notify the contractor of any such modifications in advance of any orders being placed using the modified process without additional cost to the government. Additionally, the government reserves the right to issue orders orally, by facsimile, or by any other electronic commerce methods.

14.0.2 Exceptions to Fair Opportunity

Orders may be issued without the fair opportunity process whenever circumstances warrant the exercise of any exception set forth in FAR 16.505(b)(2).

Document Title

Independent Valuation Consulting Services

15.0 Telework Government Furnished Property:

To the extent that the Contractor allows its personnel to telework or requires its employees to work offsite at the Contractor’s facility, hand receipts provided by the Government or other documentation in support of

Receipt and Issue System for Government Material shall be required upon issuance of a Government laptop and computer screen. Such laptops and computer screens are Government Furnished Property, and compliance with FAR clause 52.245-1, Government Property is required. The unit acquisition cost of each provided laptop may cost up to $3,000.00. Laptops shall be provided to Contractor personnel within 10-calendar days following an employee’s start date.

16.0 Government furnished Information:

Government furnished information: SBA will provide SBA valuation guidelines, the SBIC’s approved valuation policy (if different than SBA Valuation Guidelines, the SBIC’s valuation reports, and Form 468 financial statements, as needed.

17.0 Security Considerations:

All information obtained by the Contractor from SBA and SBICs shall be disclosed only to SBA personnel and shall not be used for any other reason by the Contractor or its staff and shall not be disclosed to any third party without the express written consent of the Contracting Officer’s Representative (COR). The

Contractor shall sign a confidentiality agreement and a conflict-of-interest agreement to ensure that the

Contractor safeguards the information provided by the SBA or prepared by the Contractor with regards to this contract.

All working papers, notes, photocopies, deliverables, and other materials produced by the contractor and received by the contractor is considered SBA property, meaning that SBA has title to these data. These files will be kept by the Contractor, but are subject to review by SBA, their auditors, and designees. They must be accessible for review within three (3) working days of request. Upon completion of this contract the Contractor must destroy all files obtained from this contract.

All software purchased (and/or modified after purchase) and databases created for use under this contract will become the property of SBA and will be delivered to SBA upon completion of this contract.

No additional security clearance is contemplated at this time. However, should security clearances be required at any time for Contractor’s employees working on this PWS, the COR will coordinate those clearances, and the SBA will process the clearances, however the Contractor will provide the documents at no cost to SBA.

18.0 Key Personnel for the IDIQ are as follows:

o Prior to removing, replacing, or diverting any of the specified individuals, the Contractor shall notify, in writing, and receive consent from, the Contracting Officer Representative within 30 days in advance of the action and shall submit justification (including proposed substitutions) in sufficient detail to permit evaluation of the impact on this contract.

o No diversion of key personnel shall be made by the Contractor without the written consent of the Contracting Officer.

General Partner: Subject Matter Expert (SME) in valuations with at least 20 years of deep experience in performing business valuations of primarily private equities. Highly preferred if they have related experience buying and selling private equities.

Document Title

Independent Valuation Consulting Services

Senior Partner: Subject Matter Expert (SME) in valuations with at least 10 years of experience in performing business valuations and acceptable current professional credentials. For instance, if the request is for accounting services, instead of valuation experience, the concern may be how to report under GAAP and therefore a CPA with 10 years of audit experience would be engaged under this hourly rate. Preferred if they have related experience buying and selling private equities and/or deep experience in C-suite role(s) managing similar companies SBICs invest.

Junior Partner: SME in business valuations with at least 5 years of experience performing valuations and acceptable valuation credentials from

Senior Staff: preferably a bachelor’s degree in accounting or finance and at least 3 years of relevant experience.

Subject Matter Expert (SME): SME in operational and investment risk assessment of private equity funds related to due diligence with at least 5 years of experience in performing business valuations and acceptable current professional credentials. Preferred if they have related experience buying and selling private equities and/or deep experience in C-suite role(s) managing similar companies SBICs invest in.

Senior Subject Matter Expert (SSME): SME in operational and investment risk assessment of private equity funds due diligence. Should have at least 10 years of deep experience in performing business valuations, primarily in private equities. Should have an equivalent amount of experience conducting operational and investment due diligence on private investment fund management. Highly preferred if they have related experience buying and selling private equities or small businesses.

Project Manager: Excel in orchestrating the various aspects of valuation projects, ensuring seamless execution and delivery. Manager I project managers are adept at coordinating teams and resources, overseeing timelines, and ensuring that projects are conducted with precision. They bring valuable insights into private equities and often leverage their expertise to make informed decisions that drive successful project outcomes. Have 5 years’ experience and a bachelor's degree.

19.0 Service Delivery Terms.

a. Place of Performance. Work will be performed remotely at the Contractor’s facility or remotely until the Contractor is notified by the Government that Government facilities are available for onsite performance. Exceptions to this requirement may be identified in individual orders.

☐ When notification of the availability of Government facilities is provided, work associated with the IDIQ must be performed at the following Government facility: N/A

☒ Even if the Government facility is…