Oct 10, 2017 · 36 To control costs when purchasing a business an attorney at the closing can from SBM 210 at Dyersburg State Community College. ... To control costs when purchasing a business, an attorney at the closing can represent both sides.
Sep 02, 2021 · To control costs when purchasing a business, an attorney at the closing can represent both sides. To control costs when purchasing a business, an attorney at the closing can represent both sides. Categories Questions. Leave a Reply Cancel reply. Your email address will not be published.
37. To control costs when purchasing a business, an attorney at the closing can represent both sides. ANS: F An attorney should represent only one side. PTS: 1 REF: p. 129 OBJ: 4-4 TYPE: C NAT: Analytic | Ethical and Legal 38. A nondisclosure agreement signed by a prospective buyer shows the seller that the buyer intends to purchase the business.
Sep 18, 2014 · To control costs when purchasing a business, an attorney at the closing can represent both sides. ANS: F An attorney should represent only one side. ANS : F An attorney should represent only one side . PTS: 1 REF: p. 129 OBJ: 4-4 TYPE: C NAT: Analytic | …
One of the advantages of buying a franchise is that the purchaser has access to a proven business system. ... Franchising offers both a proven line of business and reduced risk.
In what way is a franchisee's control over the business greatly reduced? The franchisee is bound by the terms of the franchise contract. restricted sales territories.
The franchise disclosure document (FDD) is a legal disclosure document that must be given to individuals interested in buying a U.S. franchise as part of the pre-sale due diligence process. The document contains information essential to potential franchisees about to make a significant investment.Oct 29, 2020
A franchising fee is essentially a fee that the business owner must pay to access the brand's name, proprietary business systems, special recipes, and more. This entry fee gives people a lot of the things they need to start a business.Nov 17, 2020
Costs involved in buying a franchiseFranchise fee. ... Franchise start-up costs. ... Working capital for financing a franchise. ... Ongoing franchise royalty fees. ... Ongoing franchise advertising or promotion fees. ... Other franchise costs.
7 Common Costs Associated with Starting a FranchiseFranchise Fee. When opening a franchise, it's important to remember that you are essentially “renting” the brand from the franchise. ... Legal and Accounting Fees. ... Working Capital. ... Build-Out Costs. ... Supplies. ... Inventory. ... Travel and Living Expenses During Training.Nov 6, 2017
its location may have become unsuitable; equipment and facilities may be obsolete; change and innovation are hard to implement; inventory may be outdated; accounts receivable may be worth less than face value; and the business may be overpriced. You just studied 58 terms!
What would constitute a “right to control” under a franchise contract? A franchisor would have a “right to control” if it retained a right to intervene in employee management.
Yes, franchise agreements are negotiable.
Franchise fees typically begin with an initial payment that the franchise makes to the franchisor when they sign their franchise agreement and become a franchise. This fee can be any amount above $500 (per the FTC Rule) and is generally in the range of $20,000 to $50,000.Jul 30, 2020
A franchise fee is what a prospective franchisee owes to the franchisor for the rights to use the franchise brand and franchise system. Typically the franchise fee refers to a one-time payment paid in the beginning of the relationship.Aug 20, 2020
A royalty fee is an ongoing payment that a franchisee pays to the franchisor. Almost all franchise systems require an ongoing fee from their franchisees.
Franchising: a method of distributing products or services defining the privileges and responsibilities of the involved parties. (e.g. the process of ordering, preparing and serving food using McDonald’s selected procedures and suppliers)
When engaged in “product and trade name franchising” the business mainly gets to use the well known name of the franchisor’s product or service and the operation of the company is left up to the franchisee.
master licensee is a firm or individual that acts as a sales agent (or middleman), taking on the contractual responsibility of finding new franchisees within a specified territory. Sometimes a master licensee will provide support services, such as training and warehousing, which are more traditionally provided by the franchisor.
Basically, three sources of information should be tapped: (1) independent, third-party sources such as a consultant, educational materials, or layperson information, (2) the franchisor information as seen online or in conversations, and (3) existing and previous franchisees.
When a buyer assumes a seller’s obligations, such as a lease, the seller may have a deposit with the lessor. In these situations, it is customary for the buyer to pay the seller for the deposit at closing and, upon the termination of the lease, the deposit will belong to the buyer.
The buyer and seller are each responsible for their respective professional fees. For the buyer, this would usually include attorney and accountant fees. The seller, in turn, is usually responsible for attorney, brokerage, and accountant fees. The amount of these fees will vary with the size and complexity of the transaction.
This group includes a wide variety of items, such as leases for the premises and/or equipment, insurance policies, and outstanding financial obligations. At closing, these items are prorated on a per diem basis between the buyer and seller.
UTILITIES. Several days prior to closing, the utility companies are notified of the closing and are requested to take final readings on the day of closing. The seller receives a final bill and new service starts for the buyer, so prorations are not necessary at closing.
In addition to the foregoing, it is appropriate for the buyer to maintain an adequate cash reserve to meet those miscellaneous expenses that invariably occur in the realm of day-to-day business operations. The amount of the reserve, or working capital, will depend on the circumstances of each transaction.
The buyer is typically responsible for lending fees, which may include points, appraisals, lender’s attorney fees, and filing fees. Depending on the type and size of the transaction, the amount of these fees can vary significantly. Many lenders will finance loan fees as part of the business acquisition loan.
Most taxes, such as sales or payroll taxes, will be paid by the seller up to the date of closing. Even though the taxes may not actually be paid at or before closing, such as the case with quarterly unemployment taxes, the seller warrants and guarantees that these taxes will be paid in a timely fashion. Other taxes, such as personal property and real estate taxes, which are assessed and collected once a year, are usually prorated at closing. Often these taxes cannot be precisely determined, because the governing authorities have not finalized the rates prior to closing. The buyer and seller usually agree to prorate these taxes at an estimated amount, generally based on the prior year’s taxes.
Bill of Sale. The Bill of Sale evidences the transfer of personal property from the Seller to the Buyer. It frequently includes an assumption of existing contracts.
Purchase/Sale Agreement. This is the document that officially consummates the transaction and states all material terms and conditions of the transaction. Some common items include the purchase price, a list of assets included in the transaction, representations and warranties and an indemnity clause. Other provisions that may be included, either in the document itself or in separate agreements, include: 1 Proration Agreement. The Buyer and Seller prorate the amount of certain items, for example, business personal property taxes, rent, license fees or other items relevant to the transaction, for the year in which the closing occurs. 2 Work in Progress. The Buyer and Seller specify who will handle completion and warranties on existing projects and how the revenue from these items will be distributed. 3 Training and Transition Agreement. Usually the Seller assists the Buyer with the transition of key customers, accounts and critical business processes for a certain period of time. 4 Consulting/Employment Agreement. Sometimes a Buyer might find it beneficial to retain the Seller as a consultant or an employee for a period of time. Alternatively, a Seller might require an employment agreement for a fixed term as part of the deal. 5 Non-Compete Agreement. The Seller promises not to compete with the business being sold for a period of time within a defined territory. 6 Allocation of Purchase Price. For tax purposes in an Asset Sale, the Buyer and Seller must agree on the allocation of the purchase price among the various assets purchased.
Non-Compete Agreement. The Seller promises not to compete with the business being sold for a period of time within a defined territory. Allocation of Purchase Price.
Promissory Note. Buyers frequently require financing from a bank or the Seller. In many cases, the Promissory Note provides the lender with a security interest in the business’s assets until the Buyer repays the borrowed amount. The bank or the Seller may also require a personal guaranty from the Buyer to repay the loan amount.
Kathy Tremmel has significant experience both as a business attorney and corporate executive. Her career spans both legal practice and business management and she opened her own solo law practice in January 2010. In additional to running her own practice, she also is of Counsel with Selman, Munser & Lerner, which is a business transaction law firm in Austin, Texas. Ms. Tremmel has more than 10 years’ experience as a business attorney, providing transactional legal services to a diverse client base, from start-up ventures to well established companies. She helps companies with all their contracts, including customer agreements, non-compete agreements, employment agreements, buy-sell agreements, loans, and leases, helps people set up new businesses, and represents buyers and sellers of businesses. In addition, Ms. Tremmel has 10 years of management experience working with start-up companies. As VP of Operations at Tusker Group, an international litigation support company, Ms. Tremmel led international teams, managed production and quality issues, handled price negotiations, worked closely with clients to determine the scope of their projects, provided project management services, and developed, implemented and documented best practices for processing and training. Ms. Tremmel earned a Doctor of Jurisprudence from the University of Colorado School of Law and a Bachelor of Arts from Dartmouth College. She is a Texas licensed attorney and a certified Project Management Professional.