Summary

Many sellers and their advisors elect to have us act in the capacity of a ‘value added’ dealer or reseller, whereby in addition to acting as an intermediary seller, we provide ongoing substantive value added services for and/or in partnership with the seller.  While under the tax code, installment sales already offer tax deferral for taxpayers, some advisors recommend that any tax savings be accompanied with additional non-tax motives and benefits.* Sellers typically desire to achieve those non tax benefits listed generally in the bullet points above.  In addition, our role as a Value Added Reseller allows sellers to customize our services specifically to their needs and goals. While these services often do not add margin or profits to the asset being sold immediately, they can provide substantial ongoing value and can be instrumental in maximizing a seller’s net worth.  Moreover, these services are only available in connection with our role as a value added seller as part of our acquisition of assets and thus constitute a significant non tax motive and opportunity. Based on our experience, these can provide substantial long term benefits to sellers apart from the tax benefits generated through installment sales.

 

Our Capabilities and Experience

Our team has substantial experience in two main areas: i) creating and ramping up high growth businesses and ii) serving hundreds of high income and high net worth business owners and investors.  We have found that our contacts and experience can provide unique access, perspective, or resources to other business owners.

 

Accordingly, we offer ongoing substantive services to our sellers, structured on ‘performance based’ or semi-performance based terms designed to provide value to everyone.  Some of our successful work has included: i. market research; ii. digital marketing; iii. sales team recruiting and management; iv. legal research; v. management of outsourced computer programming, engineering and blockchain consulting; vi. staffing and human resources management; vii. accounting, payroll and tax compliance; viii. public relations; ix.  regulatory relations and development; and x.investor relations and investment syndication consulting. Our team’s involvement and success has ranged from start ups to management of middle market companies and divisions with $100mm+ in revenues.  Go here for a more detailed list of our team's previous work.

 

Nature of Relationship and Services

In our ongoing role, a team member(s) or a new hire, which we and Seller typically jointly hire, provide ongoing substantive work in the ‘highest impact’ area of need that the Seller has to achieve his ‘next plateau’.  These are typically ongoing, at least part time and are solely or mostly performance based whereby upside is allocated based on the parties’ relative contributions. Because our team’s experience and Sellers’ needs vary greatly, the specific terms and conditions will be agreed upon after signing this LOI and before the final sale of the Seller’s asset.  Allocations are market rate and adjusted for the relative risk that either party bears as well as the particular skill and expertise of the parties.

 

We work with sellers to customize ongoing services that they may request.

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*Significantly, the Letter Ruling 20123401f related to a Monetized Installment Sale explicitly declined to review the transaction on economic substance grounds, as being unnecessary.  Nevertheless, some advisors, whether based on intuition, emotion, or other grounds, continue to recommend additional business purpose beyond the