Buy-Sell Newsletter

 

The following articles from our Automobile Dealership Buy/Sell Newsletter are written by our attorneys and various other professionals familiar with the automobile dealer industry.  The articles are related to the complex area of buying and selling of automobile dealerships.  They are not to be taken as legal, accounting, tax, or other advice.  You should consult your own professionals for such advice.  Some of the material may not be up to date because of legislative, regulatory, or court case changes.  Much of the material, however, remains timely.  At the end of each article you will find the year when the article was written, and you should check with your own legal counsel or other professional for any updating of the information provided in the article.

BULK SALES TAX TRAP
(This is an article by appraiser David Tait regarding the importance of having a separate bulk sales tax valuation of assets in order to save sales taxes when assets are sold and purchased in a dealership buy/sell.)

ENVIRONMENTAL DUE DILIGENCE – A CHANGING LANDSCAPE
(This is an article by R. Scott Kurtz from Ninyo & Moore regarding new criteria for environmental site assessments.)

BUYER AND SELLER UPDATE: PRIVATE PARTY ENFORCEMENT OF ADA FACILITY REQUIREMENTS
(This is an article by Partner Penny Reeves and Associate Alexandra Gass regarding the ADA requirements for automobile dealerships.)

CONSIDERATIONS IN CHOICE OF BUSINESS ENTITY
(This is an article written by CPAs David Bullock, T. Michael Phillipson, and Jonathan Forgy, partners with Parke-Guptill & Company. The article focuses on the differences between business entities such as corporations and LLCs.)

BUYER AND SELLER UPDATE: LEGISLATION CREATES A NEW VERSION OF THE "WARN" ACT FOR CALIFORNIA EMPLOYER
(This is an article by Partner Penny Reeves and Associate Alexandra Gass regarding the California Warn Act and notification to employees of loss of employment.)

BUYER AND SELLER UPDATE: IMPORTANT CHANGES TO THE HART-SCOTT-RODINO PREMERGER NOTIFICATION ACT
(This is an article by Partner Penny Reeves regarding the filing requirements under the Hart-Scoot-RodinoAct when dealing with parties with large assets or sales, or when the size of the transaction is very large.)

LETTERS OF INTENT ARE THEY CONTRACTS OR NOT?
(This is an article by Partner Joseph E. Berberich regarding the use and pitfalls of letters of intent as one of the early stages of a buy-sell agreement.)

THE IMPACT OF THE WARN ACT ON DEALERSHIP BUYER AND SELLERS
(This is an article by Partner Penny Reeves regarding rights of employees and notices that must be given to them when a certain number employees will lose their jobs by reason of a sale of a business.)

FOR AUTO DEALERS, A MOMENT OF CONTEMPLATION
(This is an article by Sheldon Sandler regarding valuation considerations in the purchase or sale of an auto dealership.)

WHEN A BUY-SELL GOES BAD: A SURVEY OF LITIGATION ISSUES
(This is an article by Partner Bob Daniels regarding buy-sell litigation issues.)

REVIEWING BUY/SELL ARGREEMENTS: TRAPS FOR THE UNWARY
(This is an article by one of our partners, Bob Daniels, on the importance of complying with the terms of the buy/sell agreement, once it is signed.)

HART-SCOTT-RODINO PREMERGER NOTIFICATION ACT
(This is an article by one our partners, Tim Robinett, on the important impact of this Act in certain buy/sell agreements.)

WHAT’S IT WORTH? DEALERSHIP VALUATIONS IN ESTATE PLANNING
(This is a practical down-to-earth article which explores various factors to be taken into consideration in dealership valuations.)

PUTTING THE "GOOD" IN GOODWILL
(This is an article about allocating some or all the goodwill connected with a dealership to the dealer principal on a personal basis with possible resultant tax savings.)

S CORPORATIONS --A FEW BUY/SELL ISSUES TO CONSIDER

(This is an article about S Corporation issues in the buy/sell process.)

VERNON B. SHCWARTZ OF FALCON FINANCIAL TALKS OF NEW CAPITAL SOURCE FOR AUTO DEALERS
(This is an article about new sources of financing auto dealership transactions.)

NEW COBRA RULES AFFECT BUSINESS SALES AND ACQUISITIONS
(This is an article by Penny L. Reeves, Esq. about important new COBRA rules which can affect the buy-sell transaction.)

GROUND COVER: CAN ENVIRONMENTAL INSURANCE FACILITATE YOUR REAL ESTATE TRANSACTION?
(This is an article by attorney Preston W. Brooks regarding the availability of environmental insurance in facilitating real estate transactions.)

THE BENEFITS OF LIMITED LIABILITY COMPANIES: INCREASED FLEXIBILITY AND LIMITED LIABILITY
(This is an article by Michael L. Cox, CPA, regarding the use of limited liability companies as a business legal entity.)

NEW CALIFORNIA FRANCHISE LEGISLATION IMPACTS BUY-SELLS
(This edition of the newsletter focuses entirely on the California franchise legislation effective Jan. 1, 1999. There is an extensive review of the legislation together with an interview of our partners, Joe Berberich and Bert Rasmussen by partner Penny Reeves.)

FACTORS CONSIDERED IN APPRAISING AN AUTO DEALERSHIP FACILITY
(This is an article by appraiser Carole Hale, MAI, SRA, which gives the process and factors involved in appraising an auto dealership.)

THE IMPACT OF THE WARN ACT ON DEALERSHIP BUYERS AND SELLERS

(This article analyzes the WARN Act which can require notices to employees before a dealership closing or layoff under certain circumstances.)

ENVIRONMENTAL DUE DILIGENCE IN DEALERSHIP TRANSACTIONS
(This is an article by George A. Johnson dealing with the environmental due diligence process in the buying and selling of automobile dealerships.)

SOME PRACTICAL TIPS ON HANDLING BUY-SELL ISSUES "BEFORE THE ATTORNEYS ARRIVE"
(This is an article by Robert D. Daniels, esq., providing tips for buyers and sellers in their dealings with each other before their attorneys become involved.)

REAL ESTATE INVESTMENT TRUSTS
(This is an article by Boyd D. Hudson, esq. and Hugh Roberts, CFP dealing with REITS as a vehicle for holding dealership real property.)

LEASED FEE VALUE OF AN AUTO DEALERSHIP AND RENTAL RATES
(This is an article by Carole Hale, a real estate appraiser, that deals with the valuation of automobile dealership leases.)

CALIFORNIA'S NEW ENVIRONMENTAL RESPONSIBILITY ACCEPTANCE ACT

(This is an article by Robert D. Daniels that deals with a new California law concerning rights and liabilities over contaminated property.)

TAX CONSIDERATION OF BUSINESS CONTINUATION AGREEMENTS
(This is an article by Boyd D. Hudson that deals with the tax considerations when business owners buy each other out under business continuation agreements.)

WHAT YOU NEED TO KNOW ABOUT THE BULK SALE LAW IN A BUY-SELL TRANSACTION
(This is an article by Larry Shewfelt who runs Wilshire Escrow Company. The article deals with the bulk sale notices and other matters required in California on transfer of the assets of a business.)

DEALER BUY-SELL AGREEMENTS AND THE TAXPAYER RELIEF ACT OF 1997
(This is an article by David S. Bullock, C.P.A. addressing the impact of the 1997 Tax Act on buy-sell agreements and also a discussion on estate and gift tax relief.)

FUTILE ATTEMPT TO CURE DEFECTIVE BULK SALE NOTICE

(This is an article by Joseph E. Berberich about what can happen if the bulk sale laws are not complied with.)

DR. JEKYLL MEETS MR. HYDE: DEALER BUY-SELLS IN THE M & A WORLD

(This is an article by Halbert B. Rasmussen regarding the purchase of automobile dealerships by public companies—an excellent review of the process.)

GROWTH WITH OTHER PEOPLE'S MONEY: CAPITAL MARKETS' VIEW OF AUTOMOBILE DEALERSHIPS
(This is an article by Scott E. Crawford, C.P.A., of Ernst & Young regarding public ownership of automobile dealership and the impact of this consolidation.)

CONDUCTING A BUY-SELL IN THE BANKRUPTCY COURT: THE PRO’S AND CONS
(This is an article by Robert D. Daniels that deals with the subject of buying a dealership out of the bankruptcy court.)

USING BUSINESS CONTINUATION AGREEMENTS

(This is an article by Boyd D. Hudson regarding the importance of business continuation agreements.)

NOTES ON HOW EMPLOYEE ISSUES IMPACT THE BUY-SELL PROCESS

(This is an article by Halbert B. Rasmussen concerning employee issues in the buy-sell process.)

UNDERGROUND STORAGE TANKS: A REPORT FROM THE FRONT
(This is an article by Kip Prahl regarding the status of underground storage tank law.)

ADA RISKS NOT TO BE IGNORED
(This is an article by Penny L. Reeves concerning the impact of the Americans with Disabilities Act on the parties to a buy-sell agreement.)

I HAVE DECIDED TO SELL MY DEALERSHIP (NOW WHAT?)
(This is an article by Kent Schmidt regarding the process of selling an automobile dealership and valuations.)

WHAT'S YOUR DEALERSHIP WORTH? GUIDELINES TO SETTING A PRICE
(This is an article by Ron Seko, C.P.A., concerning the valuation of automobile dealerships.)

USE OF NON-COMPETE AND CONSULTING AGREEMENTS IN THE SALE OF DEALERSHIP ASSETS
(This is an article by Boyd Hudson examining covenants not to compete and consulting agreements in the automobile dealership buy-sell process.)

EQUIPMENT APPRAISALS AND THE BASIS OF VALUE
(This is article by Paul Fields concerning valuation of automobile dealership equipment.)

HANDLING EQUIPMENT LEASES/PURCHASES
(This is an article by Joseph E. Berberich regarding the importance of examining and handling various contracts and leases to which a dealership may be a party in connection with the buy-sell process.)

ALTERNATE USES FOR DEALERSHIP APPRAISALS
(This is an article by Gary Sparks, C.P.A., that discusses the many uses there are for dealership appraisals.)

SHAREHOLDERS' AGREEMENTS-A VALUABLE TOOL IN BUY-INS
(This is an article by Penny Reeves regarding issues that come up in a buy-in process.)

POTENTIAL ADVANTAGES OF OPERATING DEALERSHIP AS A LIMITED LIABILITY COMPANY
(This is an article by Ted Kobyashi, C.P.A., examining reasons for creating a dealership as a limited liability company.)

MIND THE MAINFRAME WHEN MAKING THE DEAL

(This is an article by Halbert B. Rasmussen concerning the importance of handling the computer equipment in a buy-sell.)

WARDING OFF COBRA SURPRISES IN DEALERSHIP BUY-SELLS
(This is an article by Joseph E. Berberich concerning the way in which COBRA insurance factors into buy-sell agreements.)

"FRIENDLY FORECLOSURE" A VIABLE APPROACH
(This is an article by Brent W. Smith concerning the use of a "friendly foreclosure" to acquire the assets of a financially troubled dealership.)

LIFO AND BUY-SELL AGREEMENTS
(This is an article by Dave Bullock, C.P.A., concerning the impact of LIFO on buy-sell agreements.)

A NEW POINT IN YOUR AREA AFTER CLOSING BUY-SELL?

(This is an article by Joseph E. Berberich concerning the importance of knowing about factory plans or possible other points in a dealership’s geographic region.)

NEED A PARTNER OR INVESTOR? CONSIDER AN LLC
(This is an article by Halbert B. Rasmussen concerning the flexibility of the use of a limited liability company for automobile dealerships, or for separate operations of a dealership such as a body shop.)

SELLING YOUR DEALERSHIP: ASSETS VS. CORPORATE STOCK
(This is an article by Floyd Clem, C.P.A., regarding the differences between an asset and a stock purchase of an automobile dealership.)

HYDRAULIC HOISTS PROMPT ENVIRONMENTAL CONCERNS
(This is an article by Kip Prahl concerning the impact of underground hydraulic hoists in the buying and selling of automobile dealerships.)

DETERMINING FRANCHISE CAPITAL REQUIREMENTS
(This is an article by Walter Voeks concerning manufacturer’s capital requirements, together with a worksheet to assist with this.)

A CAPITAL IDEA
(This is an article by James P. Petrie, C.P.A., dealing with dealership capital requirements.)

A LOOK AT BUY-INS
(This is an article by Brent W. Smith concerning issues that come up in buy-in transactions.)

1993 TAX ACT IMPACTS BUY-SELLS
(This is an article by Floyd Clem, C.P.A., regarding the impact of the 1993 Tax Act on buy-sell agreements.)

REPRESENTATIONS AND WARRANTIES IN PURCHASE AGREEMENTS
(This is an article by Joseph E. Berberich which discusses representations and warranties typically made in an automobile dealership buy-sell agreement.)

EARLY APPRAISAL IN DEALERSHIP SALES CAN SAVE TIME, MONEY AND AGGRAVATION
(This is an article by John Glenn regarding the importance of dealership appraisals.)

PROTECTED BY AN IRONCLAD AGREEMENT? THINK AGAIN!
(This is an article by Penny L. Reeves and Halbert B. Rasmussen concerning the potential for successor liability in the purchase of assets of an automobile dealership.)

SO YOU WANT TO BUILD A NEW DEALERSHIP
(This is an article by Jack Colleran concerning the process of building a new dealership.)

ENVIRONMENTAL DEAL KILLERS
(This is an article by Michael M. Uziel regarding environmental issues impacting automobile dealership buy-sell transactions.)

DANGER AREAS IN BUYING/SELLING OPERATING ASSETS
(This is an article by Floyd Clem, C.P.A., concerning pitfalls to be avoided in valuation of operating assets.)