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Richard - Bizlaw
Richard - Bizlaw, Attorney
Category: Business Law
Satisfied Customers: 10459
Experience:  30 years of corporate, litigation and international law
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I am writing a purchase and sales agreement for a business

Customer Question

I am writing a purchase and sales agreement for a business license that I own and am selling. There are no assets, liabilities, etc. It's a license to do business (like a franchise) that I have not used. When sold, it will be assigned (transferred) to the company that I originally bought it from so that the new licensee will have access to all systems and operations, etc. As part of the Disclosure Statement, I am trying to understand whether or not I need (as part of the Security requirement), a trust, CD account or letter of credit as described in the Florida law 59.807. Do I need to create a trust, open a CD, or obtain a letter of credit under my circumstances?
Submitted: 5 years ago.
Category: Business Law
Expert:  Richard - Bizlaw replied 5 years ago.

bizlaw :

Could you double check the statute you are referring to as there no FL statute with the designation you refer to. Without the correct citation or a clearer description of what type of business you are talking about, I cannot respond.

Customer:

 Try- http://www.flsenate.gov/Laws/Statutes/2011/559.803 

Richard - Bizlaw and other Business Law Specialists are ready to help you
Customer: replied 5 years ago.
still waiting on your review of the statute as provided in the link above-
Customer: replied 5 years ago.
Relist: Incomplete answer.
I replied to the attorney with the correct link to the statute that I was referring to and still haven't gotten an answer back. Could you please send this to another business attorney? Thank you.
Expert:  Richard - Bizlaw replied 5 years ago.

I did not see your response until today. If you are selling a franchise that you purchased and your franchisor has filed the notice so that it is exempt from the disclosure requirement, you would not be making any of the promises that the franchisor makes but would be providing the purchaser all the disclosures and representations the franchisor has made. It is only where you are acting as the franchisor and will be providing the assistance etc do you fall within the definition of a business opportunity seller. Make sure your franchisor has filed the necessary notices with the state which are assertions that they are in compliance with FTC requirements.

Thank you for accepting the answer. If you need more information or are not clear on something let me know.

Customer: replied 5 years ago.

First, it is not a franchise that I am selling, but a business license. There are no royalties paid to the business licensor. The license grants access to the business licensor's proprietary operations, systems and support. When I purchased my license from the business licensor, the licensor had a disclosure as part of the sales agreement and I had three days to review it before signing it.

 

So, in this case- being a license that I am selling, are you still saying that I needn't be the one providing the disclosure, but that the licensor should?

Expert:  Richard - Bizlaw replied 5 years ago.
Yes that is what I am saying because it is the licensor that is providing the business opportunity. If you were providing and maintaining the systems and procedures and advice on how to operate the business, then you would be doing the disclosure. What you are transferring are the rights you have with the licensor. I would check with the licensor to make sure there are no changes in the disclosures and then provide your buyer with the licensor's disclosure. What you are selling are your rights as licensee you are not providing the rights yourself. Those provisions are really designed for someone who is the licensor or franchisor.