If you desire a successful business acquisition
or sale and profitability afterwards,
then you must see the following sampling
of the Fortt Business Guide contents...
All this and more,
at a moderate cost!
Try it risk-free!
10 Commandments to adhere to When you buy a business for luck has little to do with it. Make certain that you, too, follow these 10 crucial rules.
Earnest Money Deposits Discover when to put up Earnest Money and when NOT to. Be aware of how NOT to lose your E.M. if and when your Offer to Purchase goes south. This knowledge should wake up a recalcitrant Seller who may not sign a release for your funds otherwise he'll end up paying your attorney's $200.00 (+/-) per hour collection fee.
Business failures; reasons for... thirty seven (37) reasons why businesses fail, all of which are contained in 4 files.
Piercing the Corporate Veil! Here is a file packed full of information that will help you stop attorneys from "piercing the corporate golden veil" of protection via LLC or Sub-S structuring.
12 BIG mistakes made by new business owners. Now you can learn from the mistakes of others.
Accounting Terms 20 pages explaining most every accounting term that you may need to know.
Financial Ratios Pages and pages of financial ratios and explanations as to how and when to use them. Banker number crunchers love these. Prepare yourself!
231 probing questions that every buyer should always ask a business Seller about his business and industry.
Leasing Pitfalls, 17 important ones... Leasing Pitfalls - Prevent greedy, unscrupulous Landlords from ripping you off when you enter into a lease for a space or building. Why risk your retirement, home equity and kid's college funds to a Landlord? Seventeen (17) questions you must ask before you sign that lease. After reading this file you will NEVER have an excuse should you ever sign a bad lease!
Business Plans Discover how to create a successful one and where to order the best Business Plan in the USA. Plus review the top 10 (classic) Business Plan Errors and 11 elements of a good Business Plan. In addition a Website address for a URL address for the best-selling business plan software in North America. And one file pertaining only to 10 Business Plan "errors" that you should not make!
Women Entrepreneurs Now discover equity capital, WFWBO & NAWBO, organizations created to help you ladies start up & succeed. Discover what, when, why and where. Six (6) interesting files.
Business Plans, how to order the best one.... Would you like one of the best firms in the USA to create yours? Just click on to this Website.
Cash Flow: How to determine the cash flow (not the Seller's bottom line) of a business before the Purchaser's salary and debt service - then decide if a business will pencil out under new ownership.
Seller's suffering from Amnesia about assets and earnings? Once he realizes, however, that your tight Fortt Business Guide agreements can later haunt him with a financial recovery damage claim, his memory will soon return. Then the Seller will offer a full disclosure prior to closing of Escrow.
Dozen upon dozens of great forms and questionnaires created to help the Purchaser thoroughly investigate the business opportunity.
Cash flow, more information.... Learn how to calculate these important criteria by normalizing, recasting or restating the Current Profit and Loss Statements (via excel formats provided). Now the Purchaser can determine his future cash flow (and value of business) before a business is purchased rather than afterwards when it may be too late for meaningful corrections such as such as purchase price of a decision not to buy. A business can be very profitable for a Seller yet not so for a Purchaser who may have to finance all the assets, perhaps replacing the family members with new hired help, etc., etc.
Business indebtedness... this can be a genuine, creative financing tool in deal structuring that is often overlooked, most assuming that it must be paid off. A Buyer must make certain, however, that all debts are disclosed. If not, a Buyer needs protection via payment offsets if financial claims bubble to the surface after the closing of Escrow.
Stock Purchase Agreement. This file was prepared by a Texas attorney for a good ol'Texas boy who has since become my dear buddy since he purchased the Fortt Business Guide. Robert says the Fortt Business Guide is now his bible - he even copied the entire program when he purchased it several years ago, edited it and sent his recommendations to me for inclusion. Since then the FBG has grown by a 2000 pages and is now sold on CDs rather than compressed diskettes when I first started the FBG. Suffice to say last year Robert paid my way to Austin, Texas to help him acquire a business. My new friend paid his Texas attorney $375.00 per hour to prepare this Stock Purchase Agreement, with his total legal fees amounting to $5,000.00 plus, including consultation which you can now enjoy at N/C.
Money For Rent Borrowing made easier by having us buy CDs in your bank. $100,000 minimum. Discover who to contact.
Income & Expense Recasting (Restating) Whenever a buyer asks me how much is the business netting, I know right away that he does not understand how to correctly buy a business because the net profit or loss is not truly reflective of what a new owner should expect. Although the income usually remains constant there could be a huge difference in the expense numbers, i.e., more or less expenses.
Restating expenses, more information The income of a business generally remains constant unless there has been pronounced skimming that the new owner can decide to continue or not upon possession. One way to determine that value of a business is after a new N.O.I. has been determined. The expenses, however, need to be be "restated" or "recasted" in an attempt to illustrate the actual expenses that a new owner will have upon possession prior to debt service, officer salaries, depreciation & taxes. A new owner will have more OR less expenses than the previous owner. There are several files and Excel formats in the Fortt Business Guide to help you attain a better understanding of how to determine the true cash flow of a business BEFORE you purchase it.
Bankrupt firms - this file will show you where to find one. I would rather buy a business or building with definable problems than not; that is, as long as I understand the problems and have the talent and cash to eliminate them. Hence, the new (enhanced) equity created from my business and/or business cleanup goes into my pocket - not the previous owner's.
Accounting Software for Small Businesses - Here are Website addresses for ten (10) top accounting software programs that are currently available.
A diagnostic test to help you determine if you have what you need as a business owner to make it. It only takes about six minutes to complete and it's free. The price is right and the insight it brings might be priceless.
Top Ten Tips for Buyers - Here are some great ideas for the prospective business buyer. When it comes to buying a business.......there are NO stupid questions. These just help you probe further & deeper.
U.S. Department of Commerce - In this file you can Click right to exceptionally helpful assistance for Export, Grants, Reference, Information Technology, Business Development, International Trade, Defense Trade, Exports Assistance, Economic Analysis, Laws and Regulations, Patents and Trademarks, Electronic Commerce, Employment and Internship Opportunities.
Seller Warranties! No good ol' Boy deals in the Fortt Business Guide. Yes, Mr. Seller, this sounds great - but I want your statement in writing along with your signature!
Non-Compete Agreements - UNLESS; that is, you want your Seller to become your new competitor. Several versions to choose from.
Unique value allocations of business assets, both hard & intangible, for income tax saving purposes when you structure your offer.
How to locate the CEO's and/or owners & addresses of 10 million businesses.
What is are SIC (Standard Classification Code)& NAICS books? Why this could be an important tool for a prospective purchaser who will discover how and where to order this fine reference book.
2000 Franchises for Sale 2000 Franchises for Sale - Click directly onto this Website.
Franchises - Want to buy one? Discover the pros and cons of owning a franchise. Here are 4 files loaded with great, hard to find information for the Franchise buyer such as fifteen (15) important questions you must ask any Franchiser before you sign that contract. Also, discover how to finance a franchise with no outside collateral.
Franchise Guide discover how and where to order this important guide.
A Franchise Newspaper Point and Click to the largest Business and Franchise Opportunity Newspaper in the USA and Canada that specializes in business & franchise opportunities.
SBA - free and helpful books about small businesses and how to order them.
SBA nationwide lending sources complete with toll free phone numbers and names of loan officers who can help convert a marginal buyer into a strong cash one using the same or less down payment - as low as 10% d/p (with real estate) or 30% d/p for a startup. Of course, if the Seller carries back, this d/p % could possibly be reduced. Several SBA files - including a sample loan application to see if you qualify.
SBA Management Tips if you are seeking practical advice and information about managing a small business, the SBA has something for you via a hands-on-format. Find out how to easily you can order this valuable information.
SBA simple application, a trial application to see if you can qualify for an SBA loan or what you must do to qualify.
Embezzlement What to watch out for and how to establish fiscal/inventory controls. Tight controls will help keep your employees honest.
Business Partners? A good business partner is just like a good (or bad) marital partner. Discover the pros and cons of business partnerships.
U.S. Publications - How to order 10,000 books - many pertaining to successfully operating a business - many of these publications are free.
UCC searches - And why a UCC search is extremely important to you as a Purchaser.
USA International Trade Information And who to contact if a Purchaser really wants to expand his newly acquired business.
Attend Trade Shows to... promote your new business. Discover seminars and conventions all over the world for a wide variety of businesses to discover the latest products and services while monitoring your competition.
Pratt's Stats. Which is the most comprehensive business sale transaction database available for private and closely held companies. Discover how to order this outstanding source base of much-needed comprehensive resources of closely held company sale information, which will help you in your decision making process. Just Click to this Website.
How to get the Seller to pay creditors that were forgotten about by the Seller prior to the closing. Tight warranty verbiage as well as offset of notes and Escrow holdbacks will certain enhance the Purchaser's bargaining leverage.
Criminal Records Search. A business owner risks the success of a business to employee crime every time that an employee is hired. Who have you entrusted with running your business and/or working with your customers, a bank thief, child molester, murderer? Now.... for $39.00 a quick pre-employment report may prevent a very costly hiring error, past or future.
Incorporate for $40.00.... Now discover how easy it is to incorporate over the phone in just 8 minutes for $40.00 -this will also enable you to shield your assets from the sharks of life, tax agents, bill collectors, future X-wives, etc.
J-V (Joint Venture) - An association of two or more individuals engaged in a solitary business enterprise for profit without an actual partnership or incorporation. This file helps explain what a JV is all about along with providing you with a format that I have used with success.
Business Owners - helpful ideas! 10 rules for growing your business. 10 reasons why businesses fail and how to make the best business decision to enhance profits; namely, by increasing prices or cutting out the fat.
Capital Available... Tired of turndowns and run-arounds from your "local, friendly" bank by loan officers who are perhaps located 25 states away? Here is a source for thousands of Lenders/Investors who can hopefully fund your deal. Just Click to their Website for lots of good information.
Incorporate with the largest Direct incorporating company in the USA. Just Click onto this Website.
Independent Contractors & Dealers: The IRS may come knocking at your door one day to request that you pay for the FICA and sundry withholdings that your Independent Contractors and Dealers forgot to pay from their respective earnings. Your firm may be liable, if you have an IRS audit, because these Independent Contractors and Dealers were indeed found to have been employees as the result of past actions, deeds and/or omissions. This could prove to be exceptionally costly, i.e., a disaster, to someone who just bought the stock of a corporation (without warranties) and/or a new business owner who does not understand the difference between a real Independent Contractor or Dealer versus an employee until it is too late.
Letter of Intent This file explains when a Letter of Intent is needed and how to write one that does not bind either party other than establishing a due diligence time period. You will also be given a format that will enable you to create a fine, non-binding one and when to use it.
12 Ways to borrow money This will help you understand a Banker's thought process when you approach him for a business loan.
Business financial/legal structures... Most, if not all of them explained to you, regardless if Sub S-Corp., C-Corp, Partnerships, Sole Proprietorship, L.L.C., P.S., etc.
Business Word Glossary Will help you remove the mystery from many business words, terms and expressions.
Capitalization Rates for businesses This is one method to evaluating a business by using its net cash flow, I've, a return upon investment.
Corporation, you create one for $22.00 - just by filling in the blanks and bingo, you have created your own corporation or L.L.C., state filing fees are X- extra.
Home Base Business$$ Now discover 501 of the Best Business Opportunities you can operate from home.
Business Library There are a couple of P/C files describing various business books pertaining to buying, selling and operating a business.
Business Phone Numbers - And how to acquire a great one. I have always desired a good phone number whenever I started a business. Usually I was presented 10 phone numbers by the phone company and given 30 seconds to choose one that I best liked @ a cost of $250.00. Then one day I discovered by accident how to acquire a superb phone number for free, such as my current 573-0000 and previous 474-9999, an idea that I am now sharing with you in this file.
U.S. Trade - U.S. Trade - you will find a wealth of information pertaining to worldwide export trade and how our government can assist you.
Purchase a building with no (or low).... down payment. Many creative financing scenarios are presented to you in the financing verbiage of the Purchase & Sale Agreements.
Tie up a building with a Lease that has an Option to Buy.... at a later date, possibly a more convenient time while you maintain your operating capital where you need it the most, i.e., when you start up your new business acquisition. Of course, you want to do this at the time you buy your business otherwise you'll never have a better opportunity, especially if you make your Seller/Landlord "dumb & happy" with prompt lease payments. Landlords want to sell when they have bad tenants, not good ones.
Personal Guarantees, explains dangers & advantages ... A Purchaser must be extremely careful so that the Seller and his attorney do not end up with your outside (now and future) assets! This file explains the potential problems and what you should agree to and not agree to. In fact, this file alone could save your financial future. Just read some of the nightmare situations that I will share with you.
Proceed Sheet for Seller... Now as a Seller you can determine how much net cash you'll receive before you sign off the Purchase & Sale Agreement, or whenever you decides to place your business on the market. This will help you determine how much money you'll net from a sale while you can still make adjustments.
Save taxes when you sell your business... It's not what you sell your business for that is of paramount importance, but what you end up with after the taxman takes his rake that should concern you. Here are 9 P/C files that should help you save big tax dollars. Just one good idea could prove to be invaluable.
Convert an all cash sale... to an installment sale for deferred income tax purposes that will save the Seller big, big IRS TAX $$$$$. Now you can finally discover how to.
Business Liens fall off public record in 5 years... Now discover why and how. Most Sellers finance a portion of their business sale. If so, the encumbered business assets may become Free & Clear after 5 years even though your Sales Contract may extend well past this date. This one file alone could very save your ol' hide. Some Buyers would love to have your business assets, i.e., assets that represent your retirement and future security, become Free & Clear at a later date to borrow against or to sell off. And this "opportunity" for the Purchaser did NOT occur because the Purchaser prepaid his note but because of a paperwork mistake that should have been avoided. Hence, it's up to the Seller at the time of Escrow to protect his lien holder's position. Discover how!
Notes, convert to cash... If a Seller desires to convert a Note to cash after closing then the note must be structured properly before Closing of Escrow or the Seller may end up with a note that is un-salable or for that matter, can't even use them as collateral for borrowing purposes. Here are some companies that buy business notes and a list of "no - no's" when preparing a Note. Prepare the Note with certain financial guidelines in mind; that is, if you wish to borrow against the Note or sell it at a later date. And I even provided you with a file that lists companies that will buy your paper.
Grooming a business for sale A smart homeowner cleans up and repairs a house before selling it because most buyers cannot see past the cosmetic (surface) problems. Buyers of businesses are no different for most of them cannot see past the existing situation. A business owner should clean up & repair a business to make it more attractive and salable, a process that could take a year or two to accomplish. Here's a file suggesting various ways to help you accomplish this worthy objective.
#1031 Exchange - save 25% ++++ in taxes of your net equity... An entire business including real and personal property can be exchanged for another similar business. Best yet, have your business Purchaser buy your building - as you Exchange your way out of the real estate into an apartment (??) building. These files will give you great (superb) handy advice to save you big capital gains tax $$$$. But you have to plan ahead!!
2003 Tax Savings How these will impact the sale of your business. Remember it's not what you sell your business for that is of paramount importance, rather it's what you end up with $$$$ in your pocket after the tax man is through with you that is.
Recaptured Depreciation that costs the Seller BIG, BIG tax $$$$$ upon the sale of a business (within a year of sale). Discover how to legally circumvent it. The eyes of most accountants will roll over on this great concept. And the Purchasers will love this concept as well because of 100% tax write offs.
Earned Payout? Have you reached an impasse with your Purchaser, i.e., he cannot justify your inflated asking price? Many times a sales price can be maintained through an earned pay out. Now, discover the nuts & bolts of this great concept. This could help a Buyer as well who has come head to head with a recalcitrant Seller.
Stock versus Asset sale... Pros & cons...many creative structuring ideas that will the Seller save big tax dollars while enabling a shrewd Purchaser to knock down the price just because of these savings, especially if the Purchaser came up with the ideas.
Tighten up your Sales Contract.... 7 ways for a business Seller to keep the Purchaser's feet to the fire until the business is paid off. The Purchaser must remain committed and motivated to pay off any money owing to the Seller, especially should he become bored or just doesn't want to pay the contract payments because of other pressing $$$$ needs such as a new girl friend, new toys, trips, big houses, etc., etc., all paid for with your contract payment money. The small print in your Sales Contract (thanks to this file) should (will) make him realize that he, too, will bleed if he atempts to "rip you off." After this "wake up" call, your purchaser should become more motivated to make timely payments to you once more. Let me add that the difference between a renter and a buyer is that a renter has little if any commitment to sacrifice should business become difficult, whereas a Buyer who could lose everything because of a well secured, "tight" contract will "batten down the hatches" to ride out the financial storm. The confusion surfaces when renters pose as buyers, i.e., those who are unwilling to make a commitment, instead would rather have the Seller absorb all the risk of selling to them. Now a Seller can discover these "renters," i.e., wantabee buyers, before a transaction is being put together rather than afterwards when it's too late.
Personal Guarantees for the Purchaser to sign that will keep him committed to keeping your business successful, at least until you are paid off.
Business MLS Internet Websites Numerous Websites (44 +/-)on the Internet where a Seller can list a business or where Purchasers can locate one in a chosen area.
Early Possession - Sellers, be aware of the dangers of allowing your "dreamy" Purchaser to talk you into an early possession, i.e., prior to Closing of Escrow.
Visa, E-2 & L-1 Immigration Many Foreign Nationals who have sufficient cash, entrepreneurial talent and desire to acquire a Green Card via a business acquisition. Here is a great method to sell a business to those with money and need, i.e., to a Foreign National. And conversely, this is a splendid method for Foreign Nationals to legally enter the USA very quickly just by purchasing a business that makes sense and satisfies INS criteria. This file will help you discover how to accomplish this or where to hire professionals to assist you.
Hang Around after a closing... Why it pays to; that is, if a Seller wants to receive top $$$$ and to ensure a smooth transition, especially if the Purchaser owes money to the Seller. After all, the Buyer's success is also the Seller's success.
Blank Financial Statements Purchasers of businesses always want to check out the Seller's assets and earnings. I think the Seller should check out the financial strength of the Purchaser as well. One good place to start is with a full disclosure of the Purchaser's assets and (perhaps)historical earnings. Then you could tie up some of these assets (via a lien for "security purposes only") by pledging them as outside collateral in the event of a default. Oh yes, review my files pertaining to "Personal Guarantees" that are great for a Seller & could be terrible for a Buyer and his family.
Promotional Flyers for your business... A blank format along with many samples that I have used in marketing the businesses that I have sold.
Confidentiality Agreements Two (2) to choose from. You do NOT want your prospective purchaser blabbing to your employees, customers and/or competitors that he is buying your business because the transaction could very well fall apart. Or, worst yet, become your competitor just down the street (or across town).
IRS Agents posing as Buyers You must be very discreet as to with whom you are sharing your business information - and it goes without saying that you need to have your lookers sign a Confidentiality and Non-Compete Agreement - for your buyer could very well become your next competitor.
Convert a C-Corp to an S-Corp. Yes, this can be done.........and save you big $$$$ to the IRS upon a sale.
ESOPs Perhaps your employees could be the best purchasers of your business?? You'll find considerable, helpful information in the FBG to help you create your own ESOP.
Business Forms & Excel Formats Purchase & Sale Agreements & supporting Exhibits, Blank Addendum, Bill of Sale for Business, 165 Questions, Commission Agreements, Confidentiality Agreements, Dealer Agreements, Due Diligence, Equipment Lists, Escrow Instructions, Escrow Progress Report, Escrow Wrap Up, Hazardous or Toxic Waste Questionnaire, Income & Expense - Balance Sheets (Excel format) Statements, Income & Expense Recasting Statements, Inventory forms, Joint Venture, Lease, ATM Equipment Lease with a Purchase Option that is a superb equipment lease, Business, Letter of Intent, Loan Amortization, Business Narrative, Non- Compete & Confidentiality Agreements, Promissory Note, Partnership Agreement, Personal Guarantees, Seller Estimate Closing Cost Recap, Save Taxes, Lease of Business, Financial Statement, Stock Purchase Agreement and Valuation format. All formats are either Word (mostly) or Excel. Hence, these forms can be completely modified to satisfy your specific needs.
Protect yourself from costly mistakes! Who makes costly mistakes? Anyone who overlooks important details and is unaware of dangerous pitfalls. This guide has over 35-years of experience behind it contained in 560 (+) (as of 3-14/'05) Word files, Excel formats and instruction guides, educational articles & case histories that will help YOU save time, money, and worry. Review these files for a preview of many potential, opportunities, problems, successes, etc., and you'll see that we cover most of them.
The Business Purchase & Sale Agreement with clause-by-clause explanations and instructions that announces the terms and conditions of the offer as well as the closing instructions. Also stated therein are numerous financing scenarios that could convert a weak Buyer into a strong one, as well. I have even provide you with a complete "canned" or "boilerplate" (just fill in the blanks) Purchase & Sale Agreement for those of you don't want to take the time to create your own "tailer-made" one.
Business Exhibits to the Purchase and Sale Agreement Once the Purchase & Sales Agreement is signed off, then there are a number of referenced supporting Exhibits (or Addendums) that need to be worked, covering everything from Plat Map & Legal, Property Inspections, Equipment Inspections and Guarantees - a review of the building lease terms/conditions, Allocation of Business Assets for depreciation purposes, Disclosure of Business Liabilities, Inventory Evaluation, Work in Progress, Contract Retainage, Schedule of Accounts Receivable & Payable, Equipment & Machinery List, Personal Property Excluded from sale, Seller Warranties, General and Government, Covenant Not to Compete, Employment Contract, Hazardous or Toxic Material Disclosures, a Description of Customer Lists, Proof of (all) Tax Payments, and a UCC Search Report.
Save Money on Legal Fees and Brokerage Fees! Using our proven forms and step-by-step advice you may not need a lawyer or broker to help you. If you decide to utilize the services of a good attorney, accountant and/or business broker then you should still become informed about the process of buying or selling a business, or at least have a source of reference that you can refer to. You can also save money & learn much by performing your own due diligence and investigations of the business rather than hiring lawyers & accountants. Lastly, discover, i.e., prepare yourself, what to expect from your paid professionals- good and bad.
What's more important than your money? Your peace of mind. Enter a business transaction with confidence and knowledge; know you're doing everything right, and in the most efficient manner. Now you can purchase this storehouse of information for the price of dinner for two at a moderate restaurant. (Read our money-back guarantee) and you'll be in business!
Save taxes by properly structuring the sale. 9 P/C files to help the Seller minimize the cost of sale, i.e., especially tax liability & professional fees, while ensuring the Buyer that he, too, will be able to obtain maximum benefits resulting from proper deal structuring. Just one good idea could pay for the Fortt Business Guide a hundred times over.
Attorneys, why some want to reinvent the wheel. As most businesspersons realize, a good attorney can be a valued member of any business transition team. However, anyone who is interesting in buying or selling a business should become aware of "make work" attorneys, with all due respect, for that's how they earn their money. This file will prepare you for that eventuality, i.e., the "red flags" that may pop up, signals derived from my years of experience as a Business Broker.
Discover how to place a realistic value on a business. You will receive 22 P/C files containing 100's of business pricing formulas for various businesses, files that are loaded with hard to find information. Now, a Buyer should NEVER pay too much for a business, nor should a Seller under price one. Sometimes a Seller will ask too much for a business...which wastes a lot of time, or if he finds a Buyer to acquire it...he might get the business back if the business can't pay for it!
Accountants & Bookkeepers, why some don't want the business to sell. Just like attorneys, accountants and bookkeepers can be invaluable to buying, selling and/or operating any business. Nonetheless, business buyers (and owners) should arm themselves with the knowledge contained in this file because a buyer could well end up on the curb shaking his head in bewilderment & disbelief wondering why his great offer to buy got "tanked." Conversely, a Seller may wonder why his business never sells and why no buyer is ever good enough, according to his trusted financial adviser. This file should well prepare you with an interesting perspective learned from my experiences.
Stock versus Asset Sale The Fortt Business Guide dusts off some long standing methods that still work, concepts that most accountants or bookkeepers won't tell you or don't know of. If the Buyer can save the Seller significant tax liabilities from gains in asset values and recaptured depreciation, then he should pay a lower price for the business as the result. At least this ol' broker thinks so.
Valuations, 22 files pertaining to pricing a business. Purchasers, do not pay too much for a business and conversely, Sellers should not under value a business nor over value it otherwise you may get it back via a foreclosure, or it just may not sell. Now you can discover how to valuate a business yourself AND where to buy excellent valuation software to help you. Otherwise several consulting firms are listed that can perform this service for you - as can a good Business Broker.
Internet Business Websites (MLS?) Buyers can discover businesses to purchase and Sellers can find a service to list their businesses with for maximum national (international?) exposure. Forty Four (44)++++ Websites to choose from.
2 Legal Websites that are connected to the FBG via Website hyperlinks.....these sources will save you countless thousands of dollars in legal fees. Do you own research - only hire an attorney when you can't find the information here.
Personal Guarantees. Discover how these Personal Guarantees can be a disaster for a Purchaser/Lessee while being and a savior for a Seller/Lessor. In this situation, knowledge is really powerful. Buyers/Lessees, discover how NOT to lose your home equity, investments, retirement and/or kids college fund to your greedy Landlord or over zealous Sellers. Conversely, Sellers/Lessors, discover how to keep your Purchaser or Lessee motivated, on track and fully committed until your contract or lease has been fulfilled. And if both the Buyer & Seller have purchased the Fortt Business Guide, you will discover how to reach a compromise.
Lease a Business? Now discover why and when to Lease a business with the same inherent Buyer commitment as in an actual sales transaction, yet the Seller will be able to circumvent the adverse tax ramifications of a C-Corp. sale or other reasons to delay an actual sale closing. My Seller client paid $1,850.00 to his attorney for this one document, including consultation. Not only could a Seller save significant tax liabilities upon a sale but the Purchaser should receive a lower price as well, especially if he came up with this lease concept that makes the business salable NOW with a minimal tax liability rather than months or possibly years off until such time that could be favorable to the Seller tax wise.
Leased Equipment How the IRS views equipment and machine leases with Purchase Options and how not to have your equipment lease become a Contract of Sale at a later date in the eyes of the IRS. A state of the art equipment lease complete with Purchase Option is provided in P/C format. This file alone could save the Seller a huge tax IRS tax bill....and the Buyer could possibly obtain a better price for the business by showing the Seller that he could save big $$$$$. Remember, it's not what you sell a business for that is of paramount importance, but what you end up with.
Save taxes by leasing the business assets rather than selling them. Lease your equipment - with a $1.00 Buyout - No decades of recaptured depreciation to pay ordinary income taxes on. This helps the Buyer too, because he will have a 100% payment write off and perhaps a better purchase price of a business entity just because of the income tax savings realized by the Seller. I have provided you with state of the art equipment lease of a major ATM company - just adapt this P/C format to your needs.
Seller financing versus cashing out. Now discover the advantages to both the Buyer and Seller if the Seller carries the paper rather than cashing out via outside commercial financing. Of course, the Seller needs to tighten the Sales Contract as herein described.
Inspections: Business & Building/Space: The Fortt Business Guide Purchase & Sale Agreement and supporting Exhibits have a multitude of inspections that protect the Purchaser just because of this full disclosure. And conversely, if a sale indeed closes and the Purchaser had elected NOT to undertake these inspections then it would be difficult for him to fault the Seller at a later date; that is, unless problems and/or disclosures were fraudulently withheld. Better yet, if a professional company is retained to make the necessary inspections then the liability for any omissions will then be shifted to the inspecting company, assuming the inspecting company is still in business. Hence, check its E&O coverage - get a copy of the insurance cover page.
Borrowing money against business assets This helps the Seller as well as the Purchaser by raising capital for a business acquisition for a start up (aka change of ownership) is usually very difficult to finance. Bankers, however, will later fall all over each other to loan money to a businessperson who has a few profitable P&L's to show. Borrowing against assets helps the Purchaser raise enough cash to satisfy the Seller's needs. In fact, it might not be a bad idea if the Seller (quietly) guaranteed the note solely if for no other reason than he would be instantly notified when and if & when a payment went into default while there's still time to correct the problem; that is, if the Seller is carrying back a 2nd, i.e., subordinated to a Bank.
Hazardous Waste A Buyer does want to be liable for the previous owner(s) or former tenant(s) toxic wastes that were notproperly disposed of. This could be a complete financial disaster to any business. And the Seller will now be able to shift this contingent liability (and worry) to a hazardous waste inspection company just because of this inspection; that is, should toxic waste ever be found at a later date.
Equipment List formats, 2 types of... Some Seller equipment lists are as current as the Dead Sea Scrolls. A Buyer needs to be certain that the equipment he sees on site will remain there upon possession, plus he needs to establish a depreciation schedule based upon allocations of values. This also eliminates potential problems for the Seller at a later date, i.e., what is on the equipment list is what a purchaser will receive at closing, especially if a business is foreclosed upon at a later date.
Equipment Warranties - Buyers, protect yourself from a Seller's lost of memory (aka amnesia) about equipment; that is, what is the true condition of the equipment? Now you can inspect the equipment before or after closing/possession or take it "as is," which the Seller would prefer. And, if the Seller lied to you, then you'll have the verbiage to protect your interests. I have also provided the Purchaser with a Clause should the Escrow company nullify your equipment warranties with their "as is" boilerplate closing documents.
Accounts - Payable/Receivable and.... the Spread of these. Who keeps what at Escrow? Why it's important that the Purchaser maintain the cash flow of the business while not compromising the Seller's financial position.
Escrow, choosing the correct one... Why it's VERY important that you choose the correct type of Escrow service.
Multiple Payment Schedule (format) to help the Buyer and Seller keep their payment schedules for several assets well organized. Discover for yourself how to create one.
Loan Amortization: Here is a handy Excel format for you to figure out loan amortization for your business and/or real estate acquisitions.
Sample Documents Folder you may review some of my closed sales to see how I wrote my Purchase & Sale Agreements and supporting exhibits. I'll also show you how to buy a small commercial building with just a $1,000.00 out of pocket cash - how to have the Seller subordinate (his junior position) to a commercial loan (senior position). This could also apply to a building used in the operation of a business.
Insurance real, personal property and personal. What type and how much insurance to purchase that will protect the Seller after the sale, assuming Seller financing is realized. Of course, this also protects the Purchaser's equity as well.
Inventory forms that will help you become more organized at the time of final inventory. Of course, an in house point of sale type inventory accounting system makes inventory controlling much easier.
Contract Retainage Who keeps what outstanding, i.e., unfulfilled, contract(s).
Escrow Instructions Two Types: One for the Escrow Company describing the sale at hand, and another for the Buyer and Seller to refer to because they have many considerations to contend with outside of Escrow in order to ensure a smooth closing. I have provide you with a multiple page check list to ensure a careful closing.
Inventory and pricing at the time of Escrow. Who pays for dead and obsolete inventory as well as inventory shortfalls? How do you organize an inventory, especially if you do not want to mess with one?
Rolling Stock (vehicles) descriptions of, warranties and title transfers at closing.
Pre-closing checklist one that the Escrow will not provide you. This provides a schedule of requirements that the Seller and Buyer both need to be aware of to keep their transaction on track and to prevent any last minute problems at Escrow that could kill your transaction.
Borrowing from your company? Discover how to make this an IRS approved loan rather than a Constructive Dividend with resulting income taxes, interest and stiff penalties that would embarrass the Mafia.
Escrow Progress Report this helps keep your sale on track while it is being processed in Escrow, covering important commitments and dates. These are important things that the Buyer/Seller/Broker must "track" during the Closing of Escrow.
20 Reasons why you need a good Business Broker Let me emphasize that a good Business Broker is just as valuable, if not more so, than a fine attorney or accountant who should all be working as a team to help their client acquire or sell a business. A Seller should realize that it's not what a business is sold for that is of paramount importance, but how it is sold (structure of the sale) that is. What you end up with ($$$)in your "pocket" should be your major concern. By having the Fortt Business Guide at your finger tips, you can either monitor the entire process (trust but verify, as our former President Reagan once said), or indeed accomplish most of the "due diligence" & paperwork yourself, bringing in the professionals for a "Subject to Approval of" final review, thereby saving thousand of dollars in professional fees. Furthermore a "good" Business Broker can make a flawed business into a "rose garden opportunity" for a Buyer........because one person's business nightmare could be another person's business dream come true..... and/or a good Business Broker can convert a weak buyer cash wise into a strong cash buyer through creative financing. This file lists 20 ways that a good Business Broker can help you succeed.
Real Estate Forms & Excel Formats... Purchase & Sale Agreement & supporting Exhibits, blank Addendum, Building Questionnaire (for Buyer), Building Cost Breakdown for Buyer, Real Estate Closing Cost Estimate for Seller, Commission Agreement, Escrow Instructions, Escrow Progress Report, Hazardous or Toxic Waste Questionnaire, Lease of Building with Option to Purchase, Lease - Assignment of, Lease - Counteroffer, Lease - Offer to, Letter of Intent, Loan Amortization, Narrative of Real Estate, Promissory Note, Personal Guarantee, Blank Financial Statement. Apartment Income & Expense Recap. Note: All formats are either Word (mostly) or Excel. Hence, these formats can be completely modified to satisfy your specific needs.
Real Estate Purchase & Sale Agreements You are provided with Purchase & Sale Agreement and a multitude of supporting Exhibits, all in P/C formats that you can modify for your specific needs. Also, there are zillion clauses pertain to inspections, numerous financing scenarios, building inspections, how not to lose your earnest money, to Escrow Holdbacks for repairs. Also, some great stuff pertaining to leasing a space or building.
Real Estate Exhibits to the Purchase & Sale Agreements That cover everything from legal description of real property, parcel number, plat map and specifications to existing Lease terms and conditions (a questionnaire). In addition there are Building or Space Inspections, Existing Lease Agreements, descriptions of what you are leasing, who repairs, maintains and pays for what. And what your Lease Payment will be. I have even provided 2 standard Commercial Leases to Choose from, one with an Option to Buy. Personal Property Included in Sale, Personal Property Excluded from sale, to Hazard or Toxic Wastes are also covered.
Building Inspection Checklists A must checklist for anyone purchasing a building. And if you are leasing, this holds true, too, because a new tenant does not want to pay for the previous tenant's damages at a later date, perhaps when your business eventually vacates the premise.
Hide Your Real Estate Titles Would you like to hide your real estate ownership from your soon to be X spouse, X partner, X shareholder(s), lawyers, bankers, creditors,collectors, IRS agents, other sharks, etc., etc.?? Now discover how to via a direct Website hookup.
Seventeen Lease Pitfalls Educate yourself against some greedy, unscrupulous Landlords who have ice water running through their veins because they prey upon unsuspecting, optimistic future tenants. Now you can keep the Landlord from stealing your retirement, home equity and/or kid's college fund by arming yourself with the exclusive knowledge that is contained in this file.
88 Questions to ask..... before you purchase that building with or without your "dream" business. Even if you lease.......you must know these questions so that you will not be held responsible for the previous tenant's neglect and damages.
Earnest Money deposit: Buyers, discover how not to lose it! Learn when to put up earnest money and when not to. Find out why you never let a Seller or his attorney hold your Earnest Money funds and now have teeth placed in your demands to return your Earnest Money Deposit.
Discover how to make an all cash sale an installment one for deferred income tax purposes that will save the Seller big IRS tax $$$$$$ upon closing of a cash sale.
Hazardous or Toxic Waste Two great clauses - one requiring an inspection as a Condition Precedent to closing of Escrow. Or select the other clause that is an affirmation (Warranty) by your Seller/Lessor that he has no knowledge of any hazardous or toxic waste. It's good the Buyer/Lessee & Seller/Lessor to have a site inspected in any event because a Buyer/Lessee is assured that the site is clean and will incur no problems after possession and likewise the Seller/Lessor can feel assured that no one will come after him later for perceived damages. In any event, any future liability will then shifted to the Inspection Company and its insurance carrier.
Zero down payment financing Buyers, conserve your operating capital for you business, especially when you just purchased a business. Now discover how to purchase or obtain control of a business building with no out of pocket cash and why this must be done (or get a firm commitment for the future) at the time the business is acquired. Learn how to accomplish this.
Tighten the Sales Contract... Sellers, Keep your Purchaser's feet to the fire so that he will not even think of leaving town with his girlfriend and/or not pay you as agreed. Here are many great ways to tighten up your Sales Contract so that your Purchaser will bleed too should he default on your Sales Contract.
Due on Sale Clauses, how to circumvent them This helps the business owner too just in case he is having problems with his Landlord about selling his business with an existing lease that the Landlord would like to rewrite with a new lease that has higher rents and/or the Landlord just wants to give the existing tenant (business) da' boot so that the building or space can be leased again to a more profitable and/or desirable new tenant, one who may be more compatible (and profitable) as a user of the space or building.
Greedy Landlords A case study of a pending sale of mine that died due to the Landlord being insanely greedy. Even so my Buyers wanted the business so bad that they dismissed all the lease problems until I "bailed out" as their Business Broker. Then they finally got the message.
Six ways to assume a non-assumable mortgage. This will help both the building owner and purchaser because built in financing is present, thereby possibly eliminating the need to raise fresh cash via a new loan that would involve fees, inspections, appraisal expense, paperwork, lopsided banker loans, along with a multitude of other unforeseen problems and expenses that are usually associated with new financing.
Discover how to purchase a commercial business building with just $500.00 Earnest Money with format and verbiage awaiting your input. Save your operating capital for your business...buy the building at a later date when your business is profitable at which time bankers will be falling all over each other to loan you money.
Personal Guarantee two to choose from that will make the Buyer/Lessee very committed to paying off the Seller/Lessor. Also, there is a Personal Guarantee file that fully explains the benefits and risks to both parties, i.e., why the Buyer/Lessee should be extremely cautious about signing one and conversely why the Seller/Lessor should seek a firm, tight commitment. A compromise should be reached by all concerned. Those who are knowledgeable certainly have the upper hand.
Letter of Intent If you can't agree upon the price and terms of a building acquisition, why spend the time (and money) drawing up a Purchase and Sale Agreement? This is a great tool for the Buyer...to derive a better transaction. This is similar to an Offer to Lease; at least the purpose of it is...
Construction Liens just because the Seller has provided you with a title insurance policy does NOT mean that the sub-contractors will not lien your property after your closing. This file is a real eye opener to anyone contemplating new or remodeled construction and explains to you how to protect yourself from this eventuality.
Loan amortization Table When my desktop amortization software died along with my computer as the result of a Virus, I had a tough time replacing this handy program. Here is a basic Excel format that will help you, plus the Website of a company that you can order a Desktop version for your computer. I'm now in the process of having a much better program included in the Fortt Business Guide.
Zero down payment financing Offers you a multitude of ideas that will perhaps help you acquire the commercial building of the business that you are contemplating a purchase of while simultaneously maintaining the operating capital for your business. If you cannot buy the building at the time you are acquiring the business...then you must have an Option to Purchase placed in your lease because you will never have a better opportunity to purchase the real estate than when you buy the business. Once you have made your Landlord fat, dumb and happy with your timely lease payments, he will have lost all motivation to negotiate with you because Landlords and building owners only negotiate when they are hurting from bad tenancies or empty spaces/buildings!
Foreclosure Information This file tells you about Notes and Deeds of Trust, Mortgages, Real Estate Contracts, etc., etc. - Judicial and Non-judicial foreclosures.
75 Pages of Real Estate Terminology Now....look up most any word that pertains to real estate!
Foreclosure, 18 methods to stall one... A foreclosure looming on the horizon is such a tragedy to occur in anyone's life for just one mistake such as an error in judgment, a bad sickness or accident, a creditor that went bankrupt, etc., etc., will awaken the sharks of life who are waiting in the wings to pounce upon your poor Soul with blood thirsty vengeance. This file along with the preceding one could prove to be invaluable reference tools if you may someday need quick reference. Knowledge of the law is certainly powerful in this situation.
SBA financing Many files in the Business & Real Estate Information folders about SBA financing......and how you can buy a building for cash (save big bucks) with as little as 10% down payment even if you occupy as little as 25% of the structure. Also, convert yourself from a weak, low down payment contract Buyer in which the Seller carries back the financing to a strong cash Buyer via SBA financing. Numerous files to help you.
Analysis Software This real estate investment analysis software program makes it easy for use to analyze properties for real estate investing, including quality printed reports and impressive graphs & charts.
Fixture Law, 5 rules of... Q. When does personal property become real property? Ans. Courts use five rules to decide when Personal Property becomes Real Property. If you as a Buyer or Broker are concerned about property that you feel should be apart of the sale, then definitely include it in the Purchase & Sale Agreement. But read this file first, one that could save you a lot of $$$$$ grief. And conversely, if the Seller intends to remove property after closing, this should be disclosed well before the Closing of Escrow.
Tenants, T.I,'s versus Leasehold Improvements, Now discover the meaning of depreciation, allocation of building/improvement values and what the BIG, BIG ($$$$$$$$$) difference is between T.I.'s (Tenant Improvements) and Leasehold Improvements. Any Tenant should be concerned about maximizing income tax deductions resulting from a leasehold.
Agency Agreement Understand the role of your broker. Who is he truly representing? As a broker I have been a duel agent on a zillion transactions over the years...in which I legally represent the Seller who paid my fee, but I also enjoyed a fiduciary relationship to the Buyer. The advantage to the Buyer being one that I knew what the Seller expected...and have negotiated much better sales for the Purchaser as a result. This file will tell you what to expect or not to expect from an agent and the different types of agencies.
Titles, how to Here are the pros and cons of the five most widely used methods of holding a title to your real estate. This needs to be decided before the closing of a real estate Escrow, otherwise a change such as this could cost another Escrow Charge.... plus possible fees paid to the State. The big concern being, of course, protecting your assets from the sharks of life.
R.E.C. versus D.O.T. This explains the differences between a Real Estate Contract and a Deed of Trust that most Lenders use today. Each one has distinct advantageous over the other for both the borrower and Lender.
Failure to record documents This can prove to be a nightmare at a later date to the Buyer and Seller, Lessor & Lessee should important real estate documents not be recorded for public record.
Leasehold Checklist This is an invaluable checklist for anyone considering a commercial lease; that is, who (Lessor/Lessee) should pay and who is responsible for what?
Promissory Note A Purchaser should use a Note rather than putting cash up front - and choose from a dozen or so events to occur before you convert the Note to cash. It's easy to put up Earnest Money cash. Sometimes, however, it's tough getting it returned if the sale goes south and the Seller is not happy with you. (I also have verbiage in the Purchase & Sale Agreement to protect the Buyer from this). Conversely, the Seller should discover why it's imperative for that Note to be converted to cash at the earliest possible date. Learn the secrets...
Buying Real Estate for your Business? Eleven (11) rules for a successful purchase - a checklist that will help plug the holes in a real estate Purchase & Sales Agreement.
How to legally steal real estate Just an interesting way to acquire extra real estate at no charge to you.
Book Review Secrets of a millionaire real estate investor.
Apt. Income & Expense Recap Although this file doesn't have anything to do with business buildings, nonetheless someday you may wish to purchase an investment property. If so, you'll be glad to have this P/C format to crunch the numbers.
Buyer Real Estate Cost Estimate You will now be able to accurately estimate your closing costs when you acquire real estate.
Escrow Instructions to give to your Escrow Company. This is a recap of your Purchase & Sales Agreement - and closing instructions to give to your Escrow Company.
Escrow Progress Report When you purchase a building, same as with a business, you must keep track of important commitments, inspections and/or performance dates ...and who said what and when during the closing of Escrow. You must ride this transaction report on a daily basis; that is, if you want your transaction to close out as agreed to. Now eliminate unpleasant surprises, i.e., requirements that should have been taken care of by someone.
Offer to Lease This is a formal Offer to Lease, complete with an Option to Purchase the building. This enables you to negotiate the terms and conditions of a lease before actually signing one. If you cannot agree upon the basics of a lease, why spend time and money on preparing the actual lease?
Building Narrative This is a handy narrative for the building owner to present the high points and financing particulars of a building. Several samples are provided in the Sample Document Folder.
Proceed Sheet for the Seller now the Seller can determine how much net cash he'll receive before he signs off the Purchase & Sale Agreement. Better yet, figure out how much money you'll receive from a sale prior to placing your business or building on the market while you can still make adjustments.
#1031 Exchange - save 25% +++ in taxes of your net equity... Why pay Uncle Sam 25% of your net equity when you can possibly exchange out of it? A Buyer may have property that could be Exchanged to a 3rd Party with the business building owner receiving the paper or cash...and conversely the Seller may do the same thing. Now you can learn the "nuts & bolts" of exchanging plus a Website to click on to that will take you right to a "Qualified Intermediary" who will provide answers to any of your questions. There are six (6) great files to help you A-Z to understand this process.
If you must defer a commisison.... then most certainly secure it against some real estate or other asset. I have provided you with a fairly tight form that will keep your Seller motivated to pay your fee long after he forgot what you did to earn it.
Attorneys, back off!! This file alone is enough of a reason for any Business or Real Estate Broker to purchase the Fortt Business Guide for many times the price that you are paying for it! My commissions have been beaten up umpteen times by Attorneys over the years. Then one day a few years ago when I was at a closing with my Sellers, his Personal Injury (?? - he should have chosen a Business Attorney - kind of like going to a dog catcher to have your teeth filled) attorney made a rather nasty comment about Mr. Fortt's (that's me) Excessive Commission that bought a wonderful response (at least I thought so) out of my mouth that forever changed my relationship with attorneys.........who now NEVER, NEVER tamper with my pay check.
Business Appraisers IBA's Market Analysis Portfolio is now available to non-members of IBA. It is a comprehensive analysis of the market for businesses in a designated Standard Industrial Classification (SIC). It is derived from IBA's database of more than 18,000 transactions involving closely held businesses (more than 4 times as large as any similar database), and is backed by IBA's 20 plus years as the premier professional society of business appraisers. Now you can just click on to its Website.
I.B.B.A. The mission of the International Business Brokers Association was organized to promote members' professional development and interests and to maximize public awareness of the Business Brokering Profession. Discover how you can now join this fine organization.
Business Broker Newsletter Would you like to receive an outstanding monthly newsletter to learn about fascinating insights of our Business Broker profession? Even if you are not a Business Broker, any Buyer or Seller would benefits from this hard to find business information. If so, you must now subscribe to this outstanding professional newsletter. This file will tell you how to contact my friend Thomas West, publisher, and tell him you found his Website via the Fortt Business Guide.
Letters of Intent Here is a sample Letter of Intent that I use for real estate purposes. After all, if a Buyer and Seller cannot even agree upon price and terms of an acquisition/sale why spend a couple of hours preparing a detailed Purchase & Sale Agreement just to discover this? Once I have the main issues resolved then I will return within minutes with a detailed Purchase & Sale Agreement.
Hire an Assistant Perhaps after reading and digesting this article you will decide that you cannot afford the time to do everything yourself, especially the grunt work that must be done that consumes most of your limited time. You are only worth the hourly value of the tasks that you are currently performing, compounded by the fact that you only have so much time during any business day. You need to spend your time face to face with Buyers and Sellers, not shuffling papers.
Fee, Dual Agent Here's a great form that will disclose your position to the Buyer and Seller and an agreement for them to split the fee either 50/50% or as you call it. A broker has to be exceptionally careful in today's litigious society, especially if a business "goes down" and the litigating attorney creates a "who did you represent problem."
Fee, Co-broker 5 to choose from depending upon if you are the Selling, Listing or Referring Agent.
Fee, Lease 2 to choose from, flat fee or % verbiage.
Fee, Lessor Finder's Fee... to pay the agent for finding a Lessee for his space/building.
Lease Commission with an Option to Buy Discover not only how to secure the payment of a lease commission but for a sales commission as well at a later date if and when an Option to Purchase is exercised.
5 Listing Agreements Mini to Long Form, Fee Simple to Leasehold, Business or Real Estate. All on P/C Word Format awaiting your specific input.
Do you want to start up a business brokerage office? Suffice to say there are undoubtedly many Business Brokers in the USA who are far smarter & more successful than I am, with all due respect to myself. Nonetheless I am the only one who will "hand over the office keys" to you; that is, if you, too, wish to have your own business brokerage firm. Let me add that I have thousands of hours invested in the Fortt Business Guide, having initially created it for my own reference use because most of the offices that I had been associated with, including one of Portland's largest, just pointed me towards the front door..........with rubber stamped headings on boilerplate forms, offered NO training.........and I had to figure it out for myself. Hence, I should charge you thousands of dollars for all this valuable information that would take you years of tough experience to duplicate. And to now have this knowledge available seconds after loading the CD is just amazing to me.
Business Broker Flyer This is a show & tell flyer that I will sometimes enclose with a pre-approach letter to a business owner whose business I am attempting to list.
Buyer Questionnaire A good way to keep notes of your Buyer's conversations so that you don't have to keep asking him the same questions at a later date. I have one designed for Business Buyers (Biz Forms Folder) and Building Buyers (Real Estate Forms Folder).
Buyers, how to keep them honest! Buyer Broker Protection for the Broker. This is an Agreement by a Buyer not to circumvent the Broker and a Confidentiality Agreement as well.
Closes, (7) The difference between order takers and salesmen is twofold: First, a good salesman does NOT need to sit by a phone for call in leads because he'll dig up his own. And two, he does not have to wait for someone to say I'll buy or I'll list for he will plan his strategy with complete understanding, choosing correct closes that will define the situation. Here are 7 closes for you to adapt to your specific types of selling.
Commission % (Percentages) Explains the different Business Broker & Real Estate commission schedules.
Commissions, deferred... I kind of like receiving deferred commissions as long as I have cash to pay my bills and assuming the deferred commissions are well secured. No good ol' boy (hand shake) deals when it comes to paying ol' Tom. As you realize, the big risk of a deferred commission is when and if the business becomes insolvent, i.e., goes south. Here is a deferred commission form that I have used with continued success.
Commission Agreement This is my standard commission agreement that the Seller signs and the Purchaser does not see because it's none of Purchaser's business what I am paid or how much time that I have invested in that sale. I also arranged to have separate Closing Statements prepared at the closing of Escrow just to keep the Buyer's nose out of my commission. If I told the Buyer that I had shown the business or building to 5 million people over 5 years...then he would wonder what was wrong with his purchase. Or if I informed the Buyer that he was the first one who bought it, then he would think that I was being overpaid. A broker can't win!
Broker, payment of legal costs... Most, if not all, of my fee Agreements have an Attorney Fee clause stated within. That is, if I win in court the loser pays my attorney costs. Conversely, if I lose in court, I do not pay any attorney fees other than my own. Of course, the legality of this could vary depending upon the state that you reside in because a judge could over rule this.
Fee, Buyer... This is a Buyer Fee Agreement that has a $1,000.00 fee provision paid up front to help defray the Business Broker's out of pocket expense. Most importantly, if a Buyer is willing to put up a $1,000.00 cash to help cover your out of pocket costs then this shows that you indeed have a serious Buyer and not some Lookie-Lou wall kicker, i.e., aka a time waster.
Fee, Buyer This Agreement registers Buyer(s)/Lessee(s) -for a single business/property - mini form.
Fee, Buyer This Agreement allows you to register multiple unlisted businesses/buildings - long form - tight.
Fee, Buyer A finder's Fee Agreement to locate real property and/or funding - fee is to be paid by Buyer and/or Borrower.
The Fortt Guide If you need assistance in placing your order,
or if you just have some questions,
please call Tom Fortt
(877) 679-4545 (Toll free - 24 hrs.)
info@forttbusinessguide.com
