Tag Archives: banks

How Can You Sell a Business to a Buyer Who’s Broke?

According to a recent report from the Federal  Reserve Bank, over half (52%) of Americans could not pay for a $400 car repair without borrowing. We can assume that most of these folks would not be legitimate prospects to purchase … Continue reading

Posted in Business Perspectives, Economic Trends, Exit Planning, Selling a business, Strategy and Planning | Tagged , , , , , , , , , | 3 Comments

3 Responses to How Can You Sell a Business to a Buyer Who’s Broke?

  1. Neil Arthur says:

    can you identify the source of the chart stats? thanks, N

  2. What John Dini writes is so true. Seller financing sells businesses. Savvy buyers expect the seller to have some skin in the game post-acquisition.

Leave a Reply

Your email address will not be published. Required fields are marked *

Key Man Policies May Not Cover a Buy/Sell Agreement

Over the last few weeks, I’ve had a number of conversations with clients about key man insurance. Let me say at the outset that I don’t sell insurance, and have no financial stake in whether any client has coverage or … Continue reading

Posted in Entrepreneurship, Exit Options, Exit Planning, Strategy and Planning | Tagged , , , , , , , , , | 5 Comments

5 Responses to Key Man Policies May Not Cover a Buy/Sell Agreement

  1. Frank Benzoni P.E. Retired says:

    John

    Another “Wide Awake Article” – To be advised is to be prepares, and you continually do that.

    Always look forward to the next !!!

    Thank you

    Frank

  2. John,

    Agreement that key-man insurance policies should be separate from buy/sell – ownership agreements. Having lived through the unexpected loss of two employees, I would encourage small businesses to look beyond ownership when considering key man insurance as part of their disaster planning process.

    Brad

  3. Mike says:

    Another type insurance to consider is whole life purchased using Section 79 Insurance.
    Allows the company to pay for the insurance ( deduction to the company) owner pays tax on only part of cost, however beneficiary is the stock holders estate ( or wife) .
    Company pays for policy , stockholder owns and benefits from it directly.
    Can tied funding this to some part of stock valve in the future.

  4. RICH FREELAND CBC says:

    John- My 43 years in the life business has taken me into many areas of practice. The usual KEY MAN POLICY is usually designed for one purpose only.It is to cover the loss of a “Key Man” such as a top salesman that brings in more than 50% of the companies business or an engineer or project manager that a company could not operate or complete a job if they should die. Buy and Sell agreements are usually to cover owners , partnerships or corporations for death or long term disabilities to owners or stock share holders to keep the business from imploding or having to deal with non producing spouses or minor corporate owners.All these plans should be drawn up by a law firm that is experienced in Business Law! not Legal zoom! The last thing is making sure that the agreements are funded with the proper products to meet the contracts specifications in the B&S agreement. I would shy away from Sec 79 plans in funding these agreements and look at the latest IRS rulings on SEC 79 use in business insurance? Comments Welcome! RICH FREELAND CBC

    • John F. Dini says:

      Thanks Richard. I agree that key man policies should be used for critical employees as well. I know dozens of companies, however, where key man covers the owner, who does not function in a sales or client management role, and the owners’ belief is that the benefit will be used to purchase stock from their families. As to the applicable IRS codes, you illustrate my point that such instruments must be carefully constructed by a professional such as you.

Leave a Reply

Your email address will not be published. Required fields are marked *

2014 Outlook: Are We There Yet?

“The only thing we have to fear is fear itself.” Franklin Roosevelt’s inaugural address on March 4, 1933 was an early recognition of the power of consumer confidence in bolstering our economy. In 1933 The US GDP was falling to about … Continue reading

Posted in Business Perspectives, Economic Trends, John's Opinions, Politics and Regulation, Strategy and Planning | Tagged , , , , , , , , | Leave a comment

Leave a Reply

Your email address will not be published. Required fields are marked *

When Independence isn’t Freedom

I owe the idea for this column to my friend Tom Morton, whose Harrowgate blog  lends a considerable dose of dry Brit humor and keen business perspective to the issues of small business ownership. Give him a read. Sometimes the … Continue reading

Posted in Business Perspectives, John's Opinions | Tagged , , | 1 Comment

One Response to When Independence isn’t Freedom

  1. Doug Roof says:

    Great job of weaving together some of the most important and interesting facts regarding the birth of the United States of America. Commentaries like this are what make each 4th of July particularly meaningful for me. Also a reminder that no great undertaking begins perfectly, that virtually every success requires a little luck, and that any institution or process can stray from orignial intent if not closely monitored and reviewed over time.

Leave a Reply

Your email address will not be published. Required fields are marked *

What are We Afraid Of?

Last weekend I took my sons to see “Battle for LA.” It’s a WWII infantry movie. All the great lines. “Go on without me.” “Mickey can hot wire that; he’s from Jersey.” “Your father was a very brave man.” Nowadays … Continue reading

Posted in Business Perspectives, John's Opinions, Leadership | Tagged , , , | Leave a comment

Leave a Reply

Your email address will not be published. Required fields are marked *