Review the Rollover Before You Sign
Bring the offer, ownership chart, and proposed role. We’ll help you separate what gets wired at closing from what your new stake could pay later.
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Related Reading on Business Valuation and Sale Preparation
Follow Your Rollover Equity From Signing to the Next Sale
When you sell your Florida contracting company and stay on, you can reinvest part of the sale proceeds for a minority stake. A $2 million rollover tells you what you invest. Your eventual payout depends on which company issues the units, who gets paid first, and what happens if you leave.
A platform may ask you to remain president because your estimating team, field leaders, and relationships with general contractors support the work already under contract. The employment offer tells you what the buyer wants you to do. The equity documents tell you what you own and how you can get paid. Review those documents together before you settle on a headline number.
I’m Rajiv Khatri, managing partner at Sailfish Equity Advisors. We advise Florida construction owners on valuing their companies, screening acquirers, and negotiating a sale confidentially. When an owner plans to stay with a platform, we separate the cash proceeds, the reinvestment, and the operating role so the owner can make each decision on its own terms.
On November 3, 2026, counsel to Kelso Industries announced that the Peterson Partners portfolio company had acquired Randall Construction, a Florida contractor with mechanical, electrical, plumbing, fire protection, and architectural metals operations. Honigman identified the parties and the contractor’s services. Honigman’s acquisition announcement
Start With the Closing Statement and the Ownership Chart
Ask for two pages at the same time. The first is a draft closing statement showing the amount the buyer expects to wire, including any debt payoff, escrow, expenses, or working capital adjustment that affects it. The second is the ownership chart. It should name the entity that issues your new units and show where your former company and the platform’s other operations sit beneath it.
Your stake might be in the acquiring parent, a holding company, or the entity that owns your operating business. Owning part of the parent may give you exposure to acquisitions you helped build and operations you have never seen. Ask what businesses, debt, and other obligations are inside the entity in which you will invest. Find out where the next acquisition would sit in the structure and which entity would borrow to fund it.
Request the capitalization table before and after closing, including your unit class and share on a fully diluted basis. A fully diluted percentage incorporates the units that could exist if the instruments included in the calculation were exercised or converted. Ask which awards, options, and reserves are included. Then ask how your class votes and how it participates in distributions. The percentage can be accurate on the capitalization table and still describe only one tier of the payout.
If you are still pricing the operating company, work with Florida construction business brokers to assess the backlog, bonding, and management team a buyer will take over. Once that value is clear, you can identify how much of the proceeds you would commit to the new entity.
Model the Sponsor’s Priority Before You Price the Upside
Take a hypothetical Florida specialty contractor with a $10 million equity purchase price. The seller would receive $8 million in cash before closing adjustments and personal taxes and invest $2 million in units. Assume the documents give those units 20% of a specified common equity pool. The $2 million is the amount invested. The actual economic rights come from the governing documents.
Now suppose the platform is sold later. Assume the proceeds available to owners have already been reduced by debt and transaction expenses. Under one possible structure, a preferred class receives the first $6 million of those proceeds, and the founder receives 20% of what remains. Under a second possible structure, the founder shares in the entire pool at 20% without that preference. The same three hypothetical exit outcomes would produce different checks.
$5 million available to owners. The preferred class would take the available $5 million under the first structure, leaving the founder $0. Under the second structure, the founder would receive $1 million.
$10 million available to owners. The first $6 million would go to the preferred class under the first structure. The founder’s 20% share of the remaining $4 million would pay $800,000. Under the second structure, the founder would receive $2 million.
$18 million available to owners. The founder’s share after the preference would be $2.4 million. Under the second structure, it would be $3.6 million.
These scenarios isolate one provision. They assume no interim distributions, accrued preferred return, management incentive participation, further issuance, or taxes. Have the buyer model the provisions that apply to your deal. Ask for a downside, an operating case, and a stronger outcome. Trace each case from the platform’s sale price through debt and expenses to the dollar amount payable to your unit class. If a future buyer would pay partly in stock or escrow some proceeds, ask how those terms would reach you.
Work Out What Happens When the Platform Issues More Units
A platform may acquire another contractor using new equity or award units to hire managers. Suppose you own 20 of 100 units. The platform issues 25 units of the same class and you purchase none. You still own 20 units, but your ownership falls from 20% to 16%. The new acquisition could add value to each unit. Ask what price the new investor paid, how the issuance was approved, and whether you have the right to invest on comparable terms.
Check for separate rules on new preferred units and changes to the management incentive pool. A right to buy a share of new common units may have exceptions. An issuance to an affiliate might be handled differently from a third-party investment. Ask counsel to review the actual exceptions and the approvals required to issue securities that rank ahead of yours.
Request the financial statements, capitalization updates, and distribution records you’ll receive as an investor. Determine whether you can review the platform’s debt and see transactions with the sponsor or its affiliates. A board seat, an observer seat, and a right to receive quarterly statements give you different levels of access. Get clear on who has the authority to take on more debt, change distribution policy, or sell the platform.
Put the President’s Authority in the Deal File
Ask who can approve a bid that would consume a material share of your bonding capacity. Then ask who controls cash when the jobs you run are underbilled and the platform wants to deploy money elsewhere. Bring a real work-in-progress schedule, with customer information withheld until disclosure is appropriate. Use one contract to walk through an unsigned change order, a near-term payroll obligation, and the expected collection of retainage.
The purpose is to see how your reporting and approval rights will work on an ordinary project. Ask who can commit the entity to a bonded contract, approve unbudgeted hiring, adjust project reserves, or move estimating staff to another branch. Review outstanding personal indemnities or guarantees separately and find out what the surety, lender, or other counterparty would require to release them.
We pay attention when an owner would still carry project responsibility while another party controls the working capital or bond commitments. Ask the buyer to put the approval limits and escalation route in writing before signing. That gives you a concrete way to evaluate the operating role alongside the equity you would continue to hold.
Test the Equity Buyback Against Three Ways You Might Leave
Put the employment agreement beside the rollover and operating agreements. Model a voluntary resignation, a termination without cause, and a termination for cause. In each case, ask whether the platform can buy back your units, whether you can require a purchase, how the price is set, and when you would actually be paid. Ask counsel to read the definitions of cause and good reason in every agreement that uses them.
A 2024 poll of repurchase practices by Goodwin’s private equity lawyers distinguished equity sellers bought with their proceeds from incentive equity granted for their work. The study illustrates how departure circumstances can change the treatment of each. Compare the terms of your purchased units with any new performance awards and ask counsel to specify which provisions apply to each class. Goodwin’s original repurchase study
Ask what fair market value means in the buyback clause. Who chooses the appraiser? What valuation date applies? Can the company pay by note, and when would that note come due? If the sponsor sells its stake later, ask whether you can sell alongside it and whether you can be required to join the sale. Verify that a later sale of the operating company triggers the same payout rights as a sale of the parent if that distinction matters to you.
Ask your tax adviser to model closing cash and the rollover separately under the proposed structure. Have them include any tax on income allocations without a matching distribution, where applicable. Put a number on the cash you need to meet your obligations after closing before you decide how much you can leave invested.
Review the Rollover Terms Before You Grant Exclusivity
Bring the offer, proposed capitalization table, distribution model, and employment outline to a confidential sell-side M&A discussion. We can help you see which terms affect closing cash, which govern the investment, and where the two agreements pull in different directions. Your counsel and tax adviser can then evaluate the provisions that need to carry through to signing.
FAQ About Keeping Equity After a Florida Contracting Company Sale
Does rolling 20% of my sale proceeds give me 20% ownership?
The percentage of your sale proceeds you reinvest and your percentage ownership measure different things. To determine what you will own, you need the issuing entity, your unit class, the unit price, and the total units used in the calculation. Ask for both the capitalization table and a schedule that shows your payout rights.
How do I find out if my rollover units get paid after the sponsor?
Read the distribution provisions in the operating or shareholder agreement and ask the buyer to model an exit at several prices. The order of payouts, called the waterfall, shows which holders are paid first and where your class participates. Ask the buyer to identify the exact provision behind each step in the model.
Can the platform buy back my equity if it replaces me as president?
It can if the agreements give it that right. The price, timing, and procedure can vary with the circumstances of your departure and the class of units you hold. Check whether the company can elect to buy or must buy, how value is determined, and whether payment can be deferred or made by note.
Could the platform sell my contracting company without paying me out?
That depends on what you own and what the agreements treat as a payout event. A parent entity could sell one operating company while retaining the proceeds for its other operations, subject to its agreements. Ask how a sale of your former company would affect your units, available distributions, and right to receive information.
How does Sailfish Equity Advisors help Florida contractors assess rollover equity?
We help you sort the offer into closing cash, invested equity, and any compensation for continuing to run the business. We ask for the ownership chart and payout examples before you commit. We also identify contractor-specific questions about bonding, bid authority, and working capital that your advisers can address in the final documents.