Hey Wayne— I rebuilt the sample as a lower-middle-market manufacturing deal to match your shop's actual flow ($1–$25M revenue, AS9100 aerospace / precision machining, Front Range). Same three-agent framework — the finding severities and risk matrix are weighted for manufacturing instead of food service.
If you want, send me your next CIM (or a redacted one from a past close) and I'll run it through the full pipeline — free. No pitch in the report itself; it's just the memo I'd hand a partner.
Summit Precision
Machining, Inc.
A cashflow-positive aerospace shop with a real moat — and a customer-concentration problem you cannot fix after close.
Deal is workable at 3.2–3.5× adjusted EBITDA ($4.5–4.9M) contingent on three closing conditions:
- i. 36-month extension of the lead customer MSA (firm, not auto-renew)
- ii. Equipment-reinvestment holdback or a price reduction covering the $850K capex gap
- iii. 24-month retention agreement for the lead programmer
Revenue & EBITDA · 3-year trend
| Period | Revenue | Reported EBITDA | DB-Adjusted | GM% |
|---|---|---|---|---|
FY2023 baseline | $6,100 | $1,720 | $1,510 | 34% |
FY2024 new Haas VF-4SS online | $6,840 | $1,965 | $1,720 | 36% |
FY2025 owner comp addback $280K | $7,920 | $2,040 | $1,870 | 35% |
LTMLTM through Mar 2026 | $8,120 | $2,120 | $1,860 | 35% |
Addback bridge · LTM
reported → adjustedThe $850K reinvestment gap reads as a structural, not one-time, shortfall. Annualized over expected useful life, it reduces defensible EBITDA by ~$140K — already reflected above.
Prioritized findings
R-01HighConcentration — top customer 41% of revenueCustomer · source: CIM §3, MSA §11
R-02HighEquipment reinvestment deferred ~$850KCapex · source: Fixed Asset Reg, Vendor Qt #A-2241
R-03MediumKey-person risk — lead programmerHuman Capital · source: Org chart, interview
R-04MediumPending ITAR self-disclosure (minor)Legal · source: Counsel memo 2025-03
R-05MediumQuality — one RCA outstandingOps · source: QMS log
R-06LowWorking capital seasonalityFinancial · source: Bank statements
Impact × Likelihood
Gaps: the AS9100D audit report is missing two appendices (A-3 process map, C-1 supplier list). Recommend pulling before issuing LOI.
- ○ Current customer concentration letter (signed)
- ○ 2024 SR-22 environmental self-cert
- ○ Programmer non-compete (current)
| Target | Location | Revenue | Multiple | Yr |
|---|---|---|---|---|
Meridian Aerospace Machining AS9100 + ITAR | Wichita, KS | $9.1M | 5.1× | 2025 |
Sierra CNC Group No ITAR | Reno, NV | $6.4M | 4.3× | 2025 |
Keystone Precision Parts Defense prime Tier-2 | Lancaster, PA | $11.2M | 5.5× | 2024 |
Granite Machine Works Concentration issue | Manchester, NH | $4.9M | 3.6× | 2024 |
| Summit Precision (this deal) Asking | Longmont, CO | $8.1M | 4.0× (4.4× adj.) | 2026 |
Three agents, two votes to negotiate, one dissent — the dissent is the one worth reading twice.
v3.2 · consensus run 2026-04-17 08:47ZUnit economics are defensible once you back out the reinvestment shortfall. The 22.9% adjusted margin is durable for a shop this size — but the multiple on asking is closer to 4.4× than the 4.0× headline. My floor is $4.5M; above $5.2M the cap-ex gap stops being a rounding error.
ITAR self-disclosure is almost certainly no-action — DDTC has closed 89% of comparable voluntary disclosures without penalty since 2022. MSA is the real problem: terminable on 90 days, no signed renewal. I won't sign off without a written 36-month extension pre-close. Also want an IP assignment from the lead programmer.
I'm the dissent. One engineer holds ~60% of active AS9100 program knowledge, there is no written succession, and no non-compete currently in force. Retention agreement alone isn't enough — you need 24 months of documented knowledge transfer before you can run this shop without him. That's an operator problem, not a price problem.