Benefits of Making Business in Liechtenstein | Buy & Sell Business

1. BENEFITS OF MAKING BUSINESS IN LIECHTENSTEIN WWW.MERGERSCORP.COM

2. At MergersCorp M&A International we help our clients confidentially buy and sell privately held businesses, aligning the interests of all parties for mutual success and satisfaction. It is our goal to make the process of either buying a new business or selling your current business as smooth and efficient as possible. We know how important confidentiality is to our sellers and we treat it with the utmost importance. WWW.MERGERSCORP.COM

3. BENEFITS OF MAKING BUSINESS IN LIECHTENSTEIN WWW.MERGERSCORP.COM

4. Country Overview Liechtenstein is a doubly-landlocked country in Central Europe, bordered by Switzerland to the west and south and by Austria to the east. The small, alpine country of approximately 37,000 people is divided into 11 communes. Its capital is Vaduz, and the official language is German. Liechtenstein was established within the Holy Roman Empire in 1719. Occupied by both French and Russian troops during the Napoleonic wars, it became a sovereign state in 1806 and joined the Germanic Confederation in 1815. Liechtenstein became fully independent in 1866 when the Confederation dissolved. Until the end of World War I, it was closely tied to Austria, but the economic devastation caused by that conflict forced

5. Executive Summary Liechtenstein is a constitutional monarchy, has a land area of about 160 sq km (60 sq m), a population of 37,009 (July 2013 est), and is sandwiched between Switzerland and Austria. It has a customs union and a monetary union with Switzerland. Liechtenstein belongs to EFTA, and since 1995 to the EEA; it is not a member of the UN. The official language is German; English and French are also spoken, with a local dialect used in everyday life. A referendum held in March 2003, gave the ruling Prince Hans- Adam II sweeping new powers, including the right to veto parliamentary bills, sack the entire government and introduce emergency rule. Liechtenstein was primarily an agrarian country until its economic union with Switzerland propelled it into rapid industrial and financial development..

6. Introduction – Doing business in the Liechtenstein Liechtenstein may be small in size, but it is a stable business location with a highly diversified economy comprising over 4000 businesses and almost as many jobs as inhabitants. Liechtenstein offers modern infrastructure and excellent telecommunications. There is a wide variety of corporate forms available for most purposes and the legislative structure is flexible and liberal. Although Liechtenstein is a 'civil code' jurisdiction, legislation has created a trust regime which is widely used. Liechtenstein's economy is strongly focused on industry, manufacturing and the services sector. Agriculture, once the main economic sector in Liechtenstein, plays a marginal role today, while the benefits of the tourism industry for Liechtenstein as a country are neither exclusively nor primarily financial.

7. Conducting business in the Liechtenstein • the establishments • the individual enterprise The Liechtenstein public company is formed with a minimum capital of EUR 50.000 divided into bearer or registered shares with a minimum nominal value not stipulated by law. The voting shares are also possible to be issued. The first basic steps for opening a company are: depositing the minimum share capital in a bank account, checking the name availability in the Public register, drafting and notarizing the articles of incorporation and their deposit at the Liechtenstein Public Registry. The most commonly used types of business entities are : • limited liability companies

8. Taxation in the Liechtenstein The government of Liechtenstein taxes personal income, business income, and principal (wealth). The basic rate of personal income tax is 1.2%. When combined with the additional income tax imposed by the communes, the combined income tax rate is 17.82%. The basic tax rate on wealth is 0.06% per annum, and the combined total rate is 0.89%. The tax rate on corporate profits is 12.5%. Liechtenstein's gift and estate taxes vary depending on the relationship the recipient has to the giver and the amount of the inheritance. The tax ranges between 0.5% and 0.75% for spouses and children and 18% to 27% for non-related recipients. The estate tax is progressive.

9. Trade Liechtenstein mainly exports machinery and electronic products (24.5% of all exports in 2018), followed by metal products (23.1%), vehicles (12.3%) and watches and jewellery (11.4%). Liechtenstein mainly imports capital goods (41.3% of all imports in 2018), followed by raw materials and semi-finished products (37.4%) and consumer goods (15%) (Liechtenstein Office of Statistics). Liechtenstein mainly trades with EU member states and is part of a customs union with Switzerland. The country also uses the Swiss franc (CHF) as its national currency. EU is by far the top destination for Liechtenstein's exports (58.8% in 2018), followed by the US (14.6%). Asia as a whole receives 20% of the country's exports and its trade volume with Liechtenstein has seen the fastest increase in recent years.

10. Banking in the Liechtenstein Financial services account for over one-fourth of Liechtenstein’s GDP. Banks in Liechtenstein specialize in private banking and wealth management and are some of the best-capitalized banks in the world. Their high equity ratio allowed banks in Liechtenstein to deal with the 2008 financial crisis better than other European banks. There are 15 private banks in Liechtenstein, with the banking sector reporting combined assets of CHF60,556,000,000 as of 2015. Top banks in Liechtenstein are LGT Bank, Liechtensteinische Landesbank AG, VP Bank, Valartis Bank, Bank Frick, NEUE Bank,

11. Our M&A Process NEGOTIATION & CLOSE POST MERGER INTEGRATION (PMI) INTEGRATION (PMI) POST MERGER TARGET APPRAISAL APPROACH DUE DILIGENCE Key Areas  Target & market analysis;  Initial assessment of synergies & value drivers;  Indicative valuation;  Go or No-Go decision;  Preparation of transaction documents (NDA – Non- disclosure Agreement/LOI- Letter of Intent);  Select Transaction team;  Appoint advisors;  Consider funding ability.  Initial approach letter;  Signing of NDA;  Prepare & share initial information requests;  Formulation of LOI (Letter of Intent) & possible negotiations;  Initial meeting and Q&A;  Circulate information on the Target to the Transaction team.  Set scope of due diligence;  Set up VDR (virtual data room);  Coordinating of due diligence, further meetings and Q&A sessions;  Consider points relevant to the Post-Merger (PMI) phase;  Revisit indicative valuation & prepare detailed valuation based on due diligence findings;  SPA negotiations with the seller;  Development of final structure (share/asset deal) and final valuation;  Approvals;  Signing of SPA & Close.  Consider the extent of integration;  Development of 100 Day PMI Plan;  Consider short & long term objectives;  Estimate requirements to capture synergies;  Determine resource needs & optimal allocation. Parties Involved  CFO;  Head of M&A;  Accountants;  Corporate finance advisors;  Consultants.  Senior management;  CEO, CFO, CTO;  Strategy director;  Head of M&A;  Head of Business Development;  Consultants.  Company general counsel;  Lawyers;  Senior management.  Company general counsel;  Lawyers;  Senior management/HR. 11 © Midaxo 2018 www.midaxo.com

12. Looking to Buy or Sell a Business? CONTACT US NOW FOR A FREE BUSINESS VALUATION WWW.MERGERSCORP.COM

13. MergersCorp.com The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation. Member firms of the MergersCorp network of independent firms are affiliated with MergersCorp International. MergersCorp International provides no client services. No member firm has any authority to obligate or bind MergersCorp International or any other member firm vis-à-vis third parties, nor does MergersCorp International have any such authority to obligate or bind any member firm. Copyright © 2020 MergersCorp International. All rights reserved. 13 © Midaxo 2018 www.midaxo.com