Selling Your Business - Structuring Earnouts & Deferred Payment Plans

Are you planning to sell your business? Let this 8-page article guide you through the issues to consider if the sale of your business has an earn-out component or a deferred payment (seller financing) option.

The article assumes that you are selling to an arm's length third party. Topics discussed include:

• how much money the buyer should put in,
• negotiating an interest rate,
• securing the unpaid balance of the purchase price,
• considering rights of setoff,
• determining a reasonable payout timetable, and the consequences for missing a milestone,
• determining how profits will be used,
• planning for unforeseen events (death, disability, default).

Selling Your Business - Structuring Earnouts & Deferred Payment Plans is in Adobe PDF format and is copyrighted by the author.