Provided by: Jennifer Kirschenbaum, Esq.
April 13, 2021
I was offered an ownership position in a building that holds real estate for a surgery center. Can I buy in? Are these documents standard?
Is a subscription agreement standard? Somewhat, but the subscription agreement is 1% of the view. A subscription agreement is what it sounds like, a document that subscribes you - same as your amazon membership - to other terms and conditions of participation. So, when you sign a subscription agreement for a piece of real estate ownership, your are signing on to, likely, an operating agreement or shareholder agreement that will detail all the conditions of your ownership.You shouldn't sign the subscription agreement without understanding the terms of ownership, such as, how you can divest yourself of ownership, what your rights are as an owner, what restrictions as an owner you are signing on to. Also, you really need to understand the financial state of the investment, which your accountant or valuation expert may be best positioned to assist with. So, trick question - are subscription agreements standard? Perhaps, sort of. But, so what? The terms you are subscribing too are most definitely not standard.
Next question, what does a review entail if you send over the offer? A few hours, for sure. But if you want a cursory assessment to see how involved a full process will be, send over the documents and we can take a preliminary look to give you a better estimate.