KEN KIRSCHENBAUM, ESQ ALARM - SECURITY INDUSTRY LEGAL EMAIL NEWSLETTER / THE ALARM EXCHANGE You can read all of our articles on our website. Having trouble getting our emails? Change your spam controls and whitelist ken@kirschenbaumesq.com ****************************** Comment on Understanding the Hold Back in the alarm buy sell agr [part 8] July 12, 2025 ************************* Understanding the Hold Back in the alarm buy sell agr [Part 8] from article on May 12, 2025 ************************** Ken Very thorough. Thank you. We decided to sell a small portion of our book that was performing well but in a remote area. The price was right and the buyer responsible. We had included a stipulation that the buyer must notify us of any cancellation within 7 days or there would be no chargeback. Think of how helpful this was for us in regaining the account. Jim Wooster Sr alarmfunding.com James T Wooster jtwooster@alarmfunding.com cell 917 747 5379 *********************** Response *********************** Seller gives an attrition guarantee. The seller would be wise to condition that guarantee on certain performance by the buyer. Performance means handling the account in a particular way, ideally similar to how the seller handled the account, but can also include a notice provision if the account wants to cancel or fails to pay, or buyer wants to cancel the account for some reason. Sellers want to be informed so they can investigate why the account is being lost, assuming there are conditions to the guarantee. Many times the account can be salvaged or sellers find out that the buyer did something that the sales agreement prohibits, such as changed central station or increase charges, which voids the guarantee according to the sale agreement. You would be surprised how many so-called industry lawyers object to any conditions to the guarantee. Their argument is that the purchase price is based on $12,000 RMR so that at the end of the guarantee period the downward adjustment is based on that $12,000, no matter why or how the account is canceled. Most of the time these same attorneys refuse to any notice provision, presumably demanding that seller wait until the end of the guarantee period to find out how many accounts were lost and how much the purchase price is reduced. Usually there is collateral to cover the guarantee, referred to as the "holdback" [recently some yahoo came up with some other term, like "minimum measured revenue". Arguing gets you no where, so I've come up with another solution: tell them to stuff it and we refuse to do deals with the attorneys. Life's a lot simpler that way, and so are the deals. ***************** STANDARD FORM AGREEMENTS: To order up to date Standard Form Alarm / Security / Fire and related Agreements click here: www.alarmcontracts.com *************************** CONCIERGE LAWYER SERVICE PROGRAM FOR THE ALARM INDUSTRY - You can check out the program and sign up here: https://www.kirschenbaumesq.com/page/concierge or contact our Program Coordinator Stacy Spector, Esq at 516 747 6700 x 304. *********************** WEBINARS: https://www.kirschenbaumesq.com/page/alarm-webinars *********************** ALARM ARTICLES: You can always read our Articles on our website at www.kirschenbaumesq.com/page/alarm-articles updated daily ******************** Wondering how much your alarm company is worth? Click here: https://www.kirschenbaumesq.com/page/what-is-my-alarm-company-worth *********************** THE ALARM EXCHANGE - the alarm industries leading classified and business exchange - updated daily ************************* PODCASTS: https://podcasts.apple.com/us/podcast/ken-kirschenbaum-presents/id1794851477 ************************* Getting on our email list / Articles archived: Many of you are forwarding these emails to friends or asking that others be added to the list. Sign up for our daily newsletter here: Sign Up. ************************** Ken Kirschenbaum,Esq Kirschenbaum & Kirschenbaum PC Attorneys at Law 200 Garden City Plaza Garden City, NY 11530 516 747 6700 x 301 ken@kirschenbaumesq.com www.KirschenbaumEsq.com
