Negotiating Tips from the Trenches
"The greatest tension in negotiating the sale of a business is determining how much risk the seller will bear after the sale. Risk shifting can take many forms, ranging from a contingent purchase price to an open-ended indemnification obligation," says attorney James Thomas, an attorney with Minor & Brown P.C., a Denver-based company that specializes in exit strategies and business planning for privately owned businesses.Minor & Brown's affiliate, the Business Enterprise Institute, offers exit-planning seminars, books, and an “Exit Planning Review” newsletter.
"Use a professional for negotiating—someone who's not afraid to walk away from the deal," says Michael Packard, CPM, a consultant and business broker in Carlsbad, Calif., with 28 years' experience. "It's easier for a seller to make that decision with advice from an expert."
"Before anything is decided, both parties should consult their tax and legal advisers concerning the future implications of deferred payments, goodwill, non-compete agreements, reserves, contingent liabilities, and a host of issues that can surface months, even years, after the final handshake," says Joseph Klock, CRB, CRS, a 50-year real estate veteran, in Real Estate Professional, Nov./Dec.1997
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