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Professional Standards Manual

Trading Services

10. Sale Of A Business

(g) Relevant Documents

Although the sale of a business that includes real property is governed by RESA, neither RESA, the Regulations nor the Rules stipulate what documents must be provided by the seller.

A prudent licensee will ensure that all the appropriate documents are obtained for review by a prospective buyer.

The following clauses are designed to assist licensees in obtaining important financial and other information from the seller:

If the financial statements are not available, a licensee should advise the buyer to obtain professional advice from an accountant.

Buyer To Approve Documents in Sale of Business Clause

Subject to the Buyer receiving, perusing and being satisfied with:

(a) a profit and loss statement showing the revenue and expenses of the business for a period of 12 months ending not more than 120 days before the signing of the agreement;

(b) a statement of assets and liabilities; and

(c) a statement containing a list of fixtures, goods, chattels, rights and other assets relating to or connected with the business that are not included in this transaction, on or before (date) .

This condition is for the sole benefit of the Buyer.

Sale of Small Business Clause

The Buyer is buying the (select either assets or shares) of the business known as (name of business) and located at (location) , B.C.

Purchase price includes all assets, goods and chattels listed as included in the sale of the business, according to the attached schedule, except inventory on hand.

Subject to the Buyer receiving and approving the list of assets on or before (date) .

This condition is for the sole benefit of the Buyer.

NOTE: The decision as to whether assets or shares are being purchased should be made with an accountant’s advice.