Alaska Business for Sale - PDF by duz15726

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									tions and not for resale, or product inventory sold    current investors, but make sure the investors are
to the buyer in connection with the buyer’s ongo-      not “shills” - - persons who are connected to the
ing business. The complete list of exemptions          seller, as opposed to independent buyers. Before
may be found at AS 45.66.220.                          signing a contract or making a payment, discuss
                                                       the disclosure statement and contract with a law-
What are the warning signs of a business op-           yer, financial advisor, or a friend with investment
portunity scam?                                        experience.

 The following are “red flags” that should warn
you of the danger in proceeding with a particular                                                                   THE SALE OF
seller or business opportunity:
                                                                                                               BUSINESS OPPORTUNITIES
 High pressure sales, including pressure                                                                            IN ALASKA
to sign a contract immediately                                                                                    Earn $
                                                                                                                         4
 Promises of guaranteed profits or very                                                                           Work 5,000/year
high income                                                                                                           ing Pa         ,
                                                                                                                 From        rt Tim
 Claims that you can make lots of money                                                                              Home          e
                                                                                                                                                                   !
     with little investment of time or work                   For more information, or if you wish to
                                                                                                                                                          in   ess
 Initial payments that are much higher                file a complaint about a fraudulent business op-                                                Bus
                                                                                                                                                 wn
                                                       portunity, please contact:                                                           rO
than what seems reasonable for a particu         lar
                                                                                                                                    h   You
     product, service, start-up kit, or training                                                                            ts   Wit
 Unwillingness to answer questions or                 Alaska Department of Law                                         rofi
                                                                                                                   ge P
    provide required disclosures                       1031 W. Fourth Avenue, Suite 200                         Hu
                                                                                                                                             g,
                                                       Anchorage, AK 99501                                                              endin       l
                                                       269-5200                                                                    A-1 V 0 Potentia
What should a buyer do before investing in a                                                                                            ,00
                                                                                                                                   $100 m locatio ns
                                                       1-888-576-2529 (toll free from outside of            Ma                            u
business opportunity?                                                                                          ke                   Premi
                                                           Anchorage)                                       We $$$ o
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Consumers should do their homework before              www.law.state.ak.us/consumer/                               sho n the
                                                                                                                      w y Inte
purchasing a business opportunity. Contact the                                                                           ou     r
                                                       Federal Trade Commission                                              how net.
Department of Law to see if the seller is registered                                                                            !
and if so, review registration materials. Check        1-877-FTC-HELP
with the BBB (www.bbb.org) for complaint infor-        www.ftc.gov
mation about the business opportunity, and check       www.ftc.gov/bcp/conline/edcams/bizopps/                              Consumers
other sources on the internet. Talk to                    index.html
                                                                                                                             Beware!
         CONSUMERS BEWARE!                                  The Act requires that a seller register     What terms must be in the contract for a
        Advertisements for making lots of           with the Department of Law, post a $75,000          sale of a business opportunity?
money from your own business sound great. But       bond, file a disclosure statement, use a written
consumers need to be wary of claims suggesting      purchase contract, and fulfill other requirements.   The contract for the sale of a business oppor-
you can make big profits with little training or     Sellers must register with the Department of        tunity must be in writing, and the seller must
effort. This brochure provides information on       Law beginning on April 4, 2005. The registra-       give a copy to the buyer at the time buyer signs
what you can do to avoid scams involving the        tion documents submitted to the Department          the contract. The terms of the contract must
sale of business opportunities.                     are public records and may be reviewed by           include:
                                                    members of the public.
        A business opportunity is an arrangement                                                         The payment terms, including the use
where the seller leases or sells products, equip-   What information must a seller give a buyer             of an escrow account if the seller asks
ment, supplies, or services to the buyer so the     about a business opportunity?                           for a downpayment of more than 20%
buyer can start a business, and the seller agrees                                                           of the initial payment
to perform services such as providing locations      The seller must give a potential buyer a dis-       A description of all services the seller
where the products can be sold, agreeing to buy     closure statement at least 10 days before the           will provide, including training
back any products assembled by the buyer, or        buyer signs a contract or makes a payment.           Contact information for the seller, the
providing a marketing plan. While there are         The disclosure statement provides important         seller’s agents, and suppliers
legitimate business opportunities for sale, each    information, including:                              The delivery date of the product,
year thousands of people across the country be-                                                             equipment, or supplies
come victims of business opportunity scams.          The seller’s business history                      A complete description of any buy-back
                                                     The seller’s legal history, including                 provisions
        Business opportunities appear in many          bankruptcy filings                                 A statement of the buyer’s right to cancel
different forms, from stuffing envelopes or doing     The seller’s financial condition, including
medical billing at home, to leasing vending ma-       audits and income statements                      Do all sellers of business opportunities have
chines or ATMs and installing them at designated     A complete description of the services            to register?
locations, to creating websites and advertising           to be provided by the seller
certain products and services on them.               The total contract price and schedule of          There are a number of exemptions to the Sale
        If you’re considering purchasing a            payments                                          of Business Opportunities Act. For instance,
business opportunity, you should know about          The basis for the seller’s statements             the Act does not apply to a sale or an offer to
Alaska’s Sale of Business Opportunities Act,          about potential earnings                          sell a
AS 45.66.010 - 45.66.900. This law helps po-                                                             business opportunity if the total amount of
tential buyers by requiring sellers of business                                                         payments under the contract is less than $250;
opportunities that cost $250 or more to provide                                                         a franchise that complies with federal law;
information to the Department of Law and to                                                             securities regulated by, or exempt under, state
buyers.

								
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