1. We will present the offer to the seller
2. If they agree to the terms, we will draft what is called sales advice or sales instructions
3. The sales advice is then sent to the lawyers to commence drafting a sales agreement
4. If a retail or commercial lease is provided, we will request that you provide summary information to determine if the property owner is likely to agree to assign the lease
5. The business for sale agreement is drafted by the lawyers acting based on the agreed terms reached by buyer and seller

If a retail or commercial lease is involved in the sale of business, then you as the buyer are likely to be requested to provide specific documents by the property owner or their managing agent.

It is only fair and reasonable that the seller has the ability to try and determine the likelihood of the property owner agreeing to the assignment of the lease. Therefore, to be more efficient and effective for both the buyer and the seller we request this information at the same time we issue the sales advice.

The documents are outlined in the section called “Can you explain the retail or commercial lease assignment process in the ACT? What happens?”

The documents that are commonly requested are: Statement of financial position Statement of business experience A copy of the business plan Business related references

There is little value for you as a buyer running up costs with lawyers if we do not have these documents ready to present to the landlord. So, we will request that you put these together.

Thank you for taking the time to read this information. It has been provided on a voluntary basis and if you are likely to purchase a business the ACT results in you having to assign or take out a new lease that we suggest before you enter that lease arrangement you seek professional legal advice from an experienced legal practitioner.

In the ACT lessors/property owners have the legal right to approve or reject the proposed assignment of a retail or commercial lease. In assessing the credentials and viability of a prospective tenant, the lessor can request certain information and documents The lessor may request certain documents and information.

The details of this are outlined in Part 11 Assignments, subleases and mortgages of the Leases (Commercial and Retail) Act 2001. Link to the legislation: https://www.legislation.act.gov.au/View/a/2001-18/current/html/2001-18.html In summary this is the information that the lessor can request.

Information relating to the financial standing of the prospective tenant, or guarantor of the lease. Information relating to the business skills of the prospective tenant. Information relating to the proposed use of the premises. Information relating to the ability of the prospective tenant to operate the business on the premises.

When considering if a potential buyer is a suitable buyer (as a prospective tenant) we may need to determine the likelihood of the lessor approving of the assignment of the lease to the buyer as the incoming tenant. To be able to assess the viability of the buyer's offer, the buyer may need to provide the relevant documents that may be requested by the lessor.

We feel it is prudent in the offer stage of the business sale that the prospective information required by the lessor to determine the viability of the purchaser is provided before we start formalising the business sales agreement. So, to save time and money and improve the efficiency in which the sale of the business progresses, we propose the prospective tenant/buyer provides the (primary documents).

We will not request these documents until an in-principle agreement has been reached between the business buyer and seller. Once there is an agreement between buyer and seller, we will then request that the buyer as the prospective tenant provides these documents.

So the process is:

1. Offer is accepted between buyer and seller

2. Sales advice documenting the agreed offer terms is provided

3. Refundable holding deposit is paid

4. Business is placed under offer on websites and broker ceases actively seeking offers

5. Buyer provides lease documents to seller and the lawyers

6. If general agreement is reached that the likelihood of the buyer having their lease assignment approved by the lessor is positive, then we can proceed to draft sale agreement between lawyers and simultaneously seek approval from the lessor to the assignment of the lease

Documents to assess the viability of the proposed tenant:

1. Statement of Financial Position (Primary Document)

2. Statement of Assets and Liabilities (Primary Document)

3. Statement of Bank or Finance Approval (Secondary Document)

4. Business Plan containing what you propose to do and with the premise (Secondary Document)

5. Business Skills and Experience Summary Document (Primary Document)

6. References relating to your ability to run the proposed business on the premises (Primary Document)

Please do not email any bank account details to our business.

Please text the broker you have been dealing with details.

Prior to unconditional exchange the funds are exclusively held on the buyer's behalf.

It is our opinion as agents and brokers that both the buyer and seller have an interest in the exchange deposit.

Legally we have a responsibility to present all offers to the seller unless they instruct us to do otherwise.

So yes, we will. But if this happens, we will make all reasonable attempts to let you know.

Canberra Business Sales Trust Account:   BSB:062904   

Account: 10604016 

This information has been provided by the seller. We as brokers are only conduits of that information. You must make your own enquiries before submitting an offer.

You can share associated and related with your accountant, lawyers, and financiers subject to those professional's dealing with information in a professional and confidential manner. If you have any questions, please email or call (0400446605)