The WB-16 form, officially known as the Offer to Purchase – Business With Real Estate Interest, is a standardized document approved by the Wisconsin Real Estate Examining Board to facilitate the process of offering to purchase a business along with its associated real estate interests in Wisconsin. It outlines general provisions, purchase price, and descriptions of the real estate and other assets involved, ensuring that all parties are clear about the terms of the transaction. For those looking to either sell or acquire a business with real estate holdings in Wisconsin, understanding and accurately completing the WB-16 form is crucial. For guidance on filling out this form, click the button below.
In the complex and dynamic world of real estate transactions, the WB-16 Offer to Purchase – Business With Real Estate Interest form emerges as a critical document within Wisconsin's legal framework. As authorized by the Wisconsin Real Estate Examining Board, this form stands as a comprehensive agreement facilitating the sale and purchase of businesses intertwined with real estate interests. It meticulously outlines the offer's specifics, from the purchase price and earnest money details to descriptions of the real estate involved and other pertinent assets, ensuring a well-defined path forward for both buyers and sellers. Moreover, it delves into various legal provisions, including representations regarding the business and assets, obligations related to sales and use tax, and the overarching conditions governing the business and property. The form also addresses potential environmental evaluations and contingencies, which are essential in safeguarding the interests of the parties involved. Integral to the process is the clear delineation of responsibilities concerning property damage, inspections, and the eventual closing procedures – all aimed at ensuring transparency and fairness. Furthermore, it underscores the need for parties to consult with legal advisors to fully comprehend their rights and obligations under the contract, thereby underscoring the document’s role not merely as a formality but as a crucial tool for informed decision-making in real estate transactions involving businesses.
Approved by the Wisconsin Real Estate Examining Board
Page 1 of 14, WB-16
11-1-14 (Optional Use Date) 1-1-15 (Mandatory Use Date)
WB-16 OFFER TO PURCHASE – BUSINESS WITH REAL ESTATE INTEREST
1 LICENSEE DRAFTING THIS OFFER ON ____________________________________________ [DATE] IS (AGENT OF BUYER)
2(AGENT OF SELLER/LISTING BROKER) (AGENT OF BUYER AND SELLER) STRIKE THOSE NOT APPLICABLE
3GENERAL PROVISIONS The Buyer (if entity, include type and state of organization), ___________________________________
4 _____________________________________________________________________________________________________
5 _________________________________________________________, offers to purchase the Assets of the Business known as:
6 Business Name (include both legal name and any trade names) ______________________________________________________
7 __________________________________________________________________________________________________________
8 Type of Business Entity (e.g., corporation, LLC, partnership, sole proprietorship, etc.): _____________________________________
9 Business Description: ________________________________________________________________________________________
10__________________________________________________________________________________________________________
11__________________________________________________________________________________________________________
12_______________________________________________________________ (Lines 6-12 hereinafter referred to as the “Business”)
13Insert additional description, if any, at lines 699-713 or attach as an addendum per line 698. The terms of Buyer’s offer are as follows:
14■ PURCHASE PRICE: ______________________________________________________________________________________
15______________________________________________________ Dollars ($ __________________________________________).
16■ EARNEST MONEY of $ _______________________ accompanies this Offer and earnest money of $______________________
17will be mailed, or commercially or personally delivered within ___________________ days of acceptance to listing broker or
18_________________________________________________________________________________________________________.
19■ THE BALANCE OF PURCHASE PRICE will be paid in cash or equivalent at closing unless otherwise provided below.
20■ INCLUDED IN PURCHASE PRICE: Seller shall include in the purchase price the following:
21■ DESCRIPTION OF INTEREST IN REAL ESTATE:
22Street address is: ______________________________________________________________________________________ in the
23_______________ of ____________________________, County of __________________________, Wisconsin (the “Real Estate”).
24The Real Estate is owned by: __________________________________________________________________________________
25__________________________________________________________________________________________________________.
26The Real Estate is leased to: __________________________________________________________________________________
27_________________________________________________________________________________________ (see lines 300-325).
28
The interest in the Real Estate included in the purchase price is:
ownership
leasehold
assignment of existing
29
lease
______________________________________________. Insert any additional description, including further description
30of the type of interest in the Real Estate that is included in purchase price, at lines 699-713 or attach as an addendum per line 698.
31■ DESCRIPTION OF OTHER ASSETS:
32Seller shall also include in the purchase price (unless excluded at lines 48-50) the Assets of the Business including all goodwill,
33stock-in-trade, trade fixtures, accounts receivable, Business Personal Property, Fixtures, and the following additional property
34(consider work in process, if applicable): _________________________________________________________________________
35____________________________________________________________________ STRIKE AND COMPLETE AS APPLICABLE
36(hereinafter, including the interest in Real Estate described above, collectively the “Assets”).
37Seller shall convey Business Personal Property and any other personal property by Bill of Sale or ___________________________
38_________________________________________, free and clear of all liens and encumbrances except ______________________
39__________________________________________________________________________________________________________
40For the items below, the purchase price shall be based on the following terms: ___________________________________________
41(a) stock-in-trade ____________________________________________________________________________________________
42__________________________________________________________________________________________________________
43_______________________________________________________________________________________________________________
44(b) accounts receivable ________________________________________________________________________________________________
45__________________________________________________________________________________________________________
46__________________________________________________________________________________________________________
47(c) Other (e.g., work in process) ________________________________________________________________________________
48■ NOT INCLUDED IN THE PURCHASE PRICE: __________________________________________________________________
49__________________________________________________________________________________________________________
50__________________________________________________________________________________________________________
51CAUTION: Identify Fixtures, trade fixtures and Business Personal Property to be excluded by Seller or which are rented and
52will continue to be owned by the lessor (see lines 221-228 and 560-570).
Property Address: ________________________________________________________________________________________________________ Page 2 of 14, WB-16
53 NOTE: The terms of this Offer, not the listing contract or marketing materials, determine what items are included/excluded.
54ACCEPTANCE Acceptance occurs when all Buyers and Sellers have signed one copy of the Offer, or separate but identical copies
55of the Offer.
56CAUTION: Deadlines in the Offer are commonly calculated from acceptance. Consider whether short term deadlines
57running from acceptance provide adequate time for both binding acceptance and performance.
58BINDING ACCEPTANCE This Offer is binding upon both Parties only if a copy of the accepted Offer is delivered to Buyer on or
59before _______________________________________________________________. Seller may keep the Assets on the market
60and accept secondary offers after binding acceptance of this Offer.
61CAUTION: This Offer may be withdrawn prior to delivery of the accepted Offer.
62OPTIONAL PROVISIONS Terms of this Offer that are preceded by an OPEN BOX ( ) are part of this offer ONLY if the box is
63marked such as with an “X.” They are not part of this Offer if marked “N/A” or are left blank.
64DELIVERY OF DOCUMENTS AND WRITTEN NOTICES Unless otherwise stated in this Offer, delivery of documents and written
65notices to a Party shall be effective only when accomplished by one of the methods specified at lines 66-84.
66(1) Personal Delivery: giving the document or written notice personally to the Party, or the Party's recipient for delivery if named at
67line 68 or 69.
68Seller’s recipient for delivery (optional): __________________________________________________________________________
69Buyer’s recipient for delivery (optional): _________________________________________________________________________
70 (2) Fax: fax transmission of the document or written notice to the following telephone number:
71Seller: (_________) ___________________________________ Buyer: (_________) _____________________________________
72 (3) Commercial Delivery: depositing the document or written notice fees prepaid or charged to an account with a commercial 73 delivery service, addressed either to the Party, or to the Party's recipient for delivery if named at line 68 or 69, for delivery to the
74Party's delivery address at line 77 or 78.
75 (4) U.S. Mail: depositing the document or written notice postage prepaid in the U.S. Mail, addressed either to the Party, or to
76the Party's recipient for delivery if named at line 68 or 69, for delivery to the Party's delivery address at line 77 or 78.
77Delivery address for Seller: ___________________________________________________________________________________
78Delivery address for Buyer: ___________________________________________________________________________________
79 (5) E-Mail: electronically transmitting the document or written notice to the Party’s e-mail address, if given below at line 83 or 84.
80If this is a consumer transaction where the property being purchased or the sale proceeds are used primarily for personal, family or
81household purposes, each consumer providing an e-mail address below has first consented electronically to the use of electronic
82documents, e-mail delivery and electronic signatures in the transaction, as required by federal law.
83E-Mail address for Seller: ____________________________________________________________________________________
84E-Mail address for Buyer: ____________________________________________________________________________________
85BUSINESS AND PROPERTY CONDITION PROVISIONS
86■ REPRESENTATIONS REGARDING THE BUSINESS, ASSETS AND TRANSACTION: Seller represents to Buyer that as of the
87date of acceptance Seller has no notice or knowledge of Conditions Affecting the Business, Assets or Transaction (as defined at lines
88465-530) other than those identified in Seller’s disclosure report(s) CHECK AND INSERT DATES AS APPLICABLE:
89 Seller disclosure report (commercial or business real estate) dated _______________________________________________
90 Real Estate Condition Report (1-4 dwelling units) dated ________________________________________________________
91 Vacant Land Disclosure Report (no buildings) dated ___________________________________________________________
92 Business disclosure report(s) dated ________________________________________________________________________
93 Other: _____________________________________________ (specify) dated _____________________________________
94 which was/were received by Buyer prior to Buyer signing this Offer and which is/are made a part of this Offer by reference and
95__________________________________________________________________________________________________________
96__________________________________________________________________________________________________________
97____________________ INSERT CONDITIONS NOT ALREADY INCLUDED IN THE DISCLOSURE OR CONDITION REPORT(S).
98CAUTION: If Assets include 1-4 dwelling units, a Real Estate Condition Report containing the disclosures provided in Wis.
99Stat. § 709.03 may be required. If Assets include Real Estate without any buildings, a Vacant Land Disclosure Report
100containing the disclosures provided in Wis. Stat. § 709.033 may be required. Buyer may have rescission rights per Wis.
101Stat. § 709.05. A commercial or business disclosure report for commercial/business Real Estate may be used as well as
102business disclosure report(s) regarding Assets other than real estate. More than one report may be used.
103SALES AND USE TAX
104Sales and use tax, if any, for sales occurring prior to closing shall be paid by Seller. Within 120 days of closing, Seller shall provide
105Buyer with a sales and use tax clearance certificate from the Department of Revenue that any sales and use tax due has been paid,
106per Wis. Stat. Ch. 77. These responsibilities shall survive closing.
107 SALES AND USE TAX ESCROW: Seller agrees to escrow $_________________________ at closing to be held by
108 ___________________________________________________________________________ (escrow agent) and released to Seller
109 when Seller provides the escrow agent with a sales and use tax clearance certificate from the Department of Revenue confirming
110that any sales and use tax due has been paid, per Wis. Stat. Ch. 77. If a certificate is not provided to escrow agent within 120 days of
111closing, escrow funds shall be released to Buyer. Release of funds to Buyer shall not relieve Seller of Seller’s obligation to pay any
112sales and use tax due. All escrow fees shall be paid by Seller.
Page 3 of 14, WB-16
113DELIVERY/ACTUAL RECEIPT Delivery to, or Actual Receipt by, any named Buyer or Seller constitutes delivery to, or Actual
114Receipt by, all Buyers or Sellers.
115BUSINESS OPERATION Seller shall continue to conduct the Business in a regular and normal manner and shall use Seller’s best
116efforts to keep available the services of Seller’s present employees and to preserve the goodwill of Seller’s suppliers, customers and
117others having business relations with Seller. Seller shall maintain the equipment, appliances, business fixtures, fixtures, tools,
118furniture and other Business Personal Property in substantially the same working order as of the date of acceptance of this Offer.
119PROPERTY DAMAGE BETWEEN ACCEPTANCE AND CLOSING Seller shall maintain the physical Assets until the earlier of
120closing or occupancy of Buyer in materially the same condition as of the date of acceptance of this Offer, except for ordinary wear
121and tear. If, prior to the earlier of closing or occupancy by Buyer, the physical Assets are damaged in an amount of not more than five
122percent (5%) of the purchase price, Seller shall be obligated to repair the damaged property and restore it to the same condition that
123is was in on the day of this Offer. No later than closing, Seller shall provide Buyer with lien waivers for all lienable repairs and
124restoration. If Seller is unable to repair and restore the damaged property, Seller shall promptly notify Buyer in writing and this Offer
125may be canceled at the option of the Buyer. If the damage shall exceed such sum, Seller shall promptly notify Buyer in writing of the
126damage and this Offer may be canceled at the option of Buyer. Should Buyer elect to carry out this Offer despite such damage,
127Buyer shall be entitled to any insurance proceeds relating to the damaged property, plus a credit towards the purchase price equal to
128the amount of Seller’s deductible on such policy, if any. However, if this sale is financed by a land contract or a mortgage to Seller,
129any insurance proceeds shall be held in trust for the sole purpose of restoring the physical Assets.
130INSPECTIONS AND TESTING Buyer may only conduct inspections or tests if specific contingencies are included as a part of this
131Offer. An “inspection” is defined as an observation of the Assets which does not include an appraisal or testing of the Assets, other
132than testing for leaking carbon monoxide, or testing for leaking LP gas or natural gas used as a fuel source, which are hereby
133authorized. A “test” is defined as the taking of samples of materials such as soils, water, air or building materials from the Assets and
134the laboratory or other analysis of these materials. Seller agrees to allow Buyer’s inspectors, testers, appraisers and qualified third
135parties reasonable access to the Assets upon advance notice, if necessary to satisfy the contingencies in this Offer. Buyer and
136licensees may be present at all inspections and testing. Except as otherwise provided, Seller’s authorization for inspections does not
137authorize Buyer to conduct testing of the Assets.
138NOTE: Any contingency authorizing testing should specify the Assets to be tested, the purpose of the test, (e.g., to
139determine if the presence or absence of a source of environmental contamination), any limitations on Buyer's testing and
140any other material terms of the contingency.
141Buyer agrees to promptly restore the Assets to their original condition after Buyer’s inspections and testing are completed unless
142otherwise agreed to with Seller. Buyer agrees to promptly provide copies of all inspection and testing reports to Seller. Seller
143acknowledges that certain inspections or tests may detect environmental pollution which may be required to be reported to the
144Wisconsin Department of Natural Resources.
145BUYER’S PRE-CLOSING VIEW OF ASSETS Within 3 days prior to closing, at a reasonable time pre-approved by Seller or Seller's
146agent, Buyer shall have the right to view the Assets solely to determine that there has been no significant change in the condition of
147the Assets, except for ordinary wear and tear and changes approved by Buyer, and that any Defects Seller has agreed to cure have
148been repaired in the manner agreed to by the Parties.
149CAUTION: The intention of this paragraph is only to allow Buyer to view the Assets. The Parties should consider separate
150language to address specific concerns.
151PROPERTY IMPROVEMENT, DEVELOPMENT OR CHANGE OF USE If Buyer contemplates improving, developing or changing
152the use of the Assets, Buyer may need to address municipal ordinances and zoning, recorded building and use restrictions,
153covenants and easements which may prohibit some improvements or uses. The need for licenses, building permits, zoning
154variances, environmental audits, etc. may need to be investigated to determine feasibility of improvements, development or use
155changes for the Assets. Contingencies for investigation of these issues may be added to this Offer. See lines 355-381 and 382-424.
156If plant closings or mass layoffs will occur as a result of this Offer the Buyer and Seller should review federal and state plant closing
157laws.
158PROPERTY DIMENSIONS AND SURVEYS Buyer acknowledges that any land, building or room dimensions, or total acreage or
159building square footage figures, provided to Buyer by Seller or by a broker, may be approximate because of rounding, formulas used
160or other reasons, unless verified by survey or other means.
161CAUTION: Buyer should verify total square footage or acreage figures and land, building or room dimensions, if material to
162Buyer’s decision to purchase.
163DEFAULT Seller and Buyer each have the legal duty to use good faith and due diligence in completing the terms and conditions of
164this Offer. A material failure to perform any obligation under this Offer is a default which may subject the defaulting party to liability
165for damages or other legal remedies.
166If Buyer defaults, Seller may:
167(1) sue for specific performance and request the earnest money as partial payment of the purchase price; or
168(2) terminate the Offer and have the option to: (a) request the earnest money as liquidated damages; or (b) sue for actual
169damages.
170If Seller defaults, Buyer may:
171(1) sue for specific performance; or
172(2) terminate the Offer and request the return of the earnest money, sue for actual damages, or both.
173In addition, the Parties may seek any other remedies available in law or equity.
Page 4 of 14, WB-16
174 The Parties understand that the availability of any judicial remedy will depend upon the circumstances of the situation and the
175discretion of the courts. If either Party defaults, the Parties may renegotiate the Offer or seek nonjudicial dispute resolution instead of
176the remedies outlined above. By agreeing to binding arbitration, the Parties may lose the right to litigate in a court of law those
177disputes covered by the arbitration agreement.
178NOTE: IF ACCEPTED, THIS OFFER CAN CREATE A LEGALLY ENFORCEABLE CONTRACT. BOTH PARTIES SHOULD READ
179THIS DOCUMENT CAREFULLY. BROKERS MAY PROVIDE A GENERAL EXPLANATION OF THE PROVISIONS OF THE
180OFFER BUT ARE PROHIBITED BY LAW FROM GIVING ADVICE OR OPINIONS CONCERNING YOUR LEGAL RIGHTS UNDER
181THIS OFFER OR HOW TITLE SHOULD BE TAKEN AT CLOSING. AN ATTORNEY SHOULD BE CONSULTED IF LEGAL
182ADVICE IS NEEDED.
183ENTIRE CONTRACT This Offer, including any amendments to it, contains the entire agreement of the Buyer and Seller regarding
184the transaction. All prior negotiations and discussions have been merged into this Offer. This agreement binds and inures to the
185benefit of the parties to this Offer and their successors in interest.
186EARNEST MONEY
187■ HELD BY: Unless otherwise agreed, earnest money shall be paid to and held in the trust account of the listing broker (Buyer’s
188broker if Assets are not listed or Seller’s account if no broker is involved), until applied to purchase price or otherwise disbursed as
189provided in the Offer.
190CAUTION: Should persons other than a broker hold earnest money, an escrow agreement should be drafted by the Parties
191or an attorney. If someone other than Buyer makes payment of earnest money, consider a special disbursement agreement.
192■ DISBURSEMENT: If negotiations do not result in an accepted offer, the earnest money shall be promptly disbursed (after
193clearance from payor’s depository institution if earnest money is paid by check) to the person(s) who paid the earnest money. At
194closing, earnest money shall be disbursed according to the closing statement. If this Offer does not close, the earnest money shall be
195disbursed according to a written disbursement agreement signed by all Parties to this Offer. If said disbursement agreement has not
196been delivered to broker within 60 days after the date set for closing, broker may disburse the earnest money: (1) as directed by an
197attorney who has reviewed the transaction and does not represent Buyer or Seller; (2) into a court hearing a lawsuit involving the
198earnest money and all Parties to this Offer; (3) as directed by court order; or (4) any other disbursement required or allowed by law.
199Broker may retain legal services to direct disbursement per (1) or to file an interpleader action per (2) and broker may deduct from
200the earnest money any costs and reasonable attorney’s fees, in an amount up to $1,000 but no more than one-half of the earnest
201money, prior to disbursement.
202■ LEGAL RIGHTS/ACTION: Broker’s disbursement of earnest money does not determine the legal rights of the Parties in relation to
203this Offer. Buyer’s or Seller’s legal right to earnest money cannot be determined by broker. At least 30 days prior to disbursement per
204(1) or (4) above, broker shall send Buyer and Seller notice of the disbursement by certified mail. If Buyer or Seller disagree with
205broker’s proposed disbursement, a lawsuit may be filed to obtain a court order regarding disbursement. Small Claims Court has
206jurisdiction with regard to civil actions involving amounts claimed up to the amount specified in Wis. Stat. Ch. 799. Buyer and Seller
207should consider consulting attorneys regarding their legal rights under this Offer in case of a dispute. Both Parties agree to hold the
208broker harmless from any liability for good faith disbursement of earnest money in accordance with this Offer or applicable
209Department of Safety and Professional Service regulations concerning earnest money. See Wis. Admin. Code Ch. REEB 18.
210SPECIAL ASSESSMENTS/OTHER EXPENSES Special assessments, if any, levied or for work actually commenced prior to date
211of this Offer shall be paid by Seller no later than closing. All other special assessments shall be paid by Buyer.
212CAUTION: Consider a special agreement if area assessments, property owners association assessments, special charges
213for current services under Wis. Stat. § 66.0627 or other expenses are contemplated. “Other expenses” are one-time charges
214or ongoing use fees for public improvements (other than those resulting in special assessments) relating to curb, gutter,
215street, sidewalk, municipal water, sanitary and storm water and storm sewer (including all sewer mains and hook-
216up/connection and interceptor charges), parks, street lighting and street trees, and impact fees for other public facilities, as
217defined in Wis. Stat. § 66.0617(1)(f).
218DEFINITIONS
219■ ACTUAL RECEIPT: “Actual Receipt” means that a Party, not the Party’s recipient for delivery, if any, has the document or written
220notice physically in the Party’s possession, regardless of the method of delivery.
221■ BUSINESS PERSONAL PROPERTY: “Business Personal Property” is defined as all tangible and intangible personal property and
222rights in personal property owned by Seller and used in the Business as of the date of this Offer, including, but not limited to,
223furniture, trade fixtures and equipment, tools used in business, telephone numbers and listings if transferable, customer lists, trade
224names, intellectual property, Internet domain names, digital media, digital marketing, databases, business records, supplies, leases,
225advance lease deposits, customer deposits, signs, all other personal property used in Business, and if transferable, all permits,
226special licenses and franchises, except those assets disposed of in the ordinary course of business or as permitted by this Offer.
227CAUTION: Identify on lines 48-50 Business Personal Property not included in the purchase price or not exclusively owned
228by Seller, such as licensed or rented personal property, tenants’ personal property and tenants’ trade fixtures.
229(Definitions Continued on Page 9)
Property Address: ________________________________________________________________________________________________________Page 5 of 14, WB-16
230TIME IS OF THE ESSENCE “Time is of the Essence” as to: (1) earnest money payment(s); (2) binding acceptance; (3) occupancy;
231(4) date of closing; (5) contingency Deadlines STRIKE AS APPLICABLE and all other dates and Deadlines in this Offer except: ____
232____________________________________________________________________________________. If “Time is of the Essence”
233applies to a date or Deadline, failure to perform by the exact date or Deadline is a breach of contract. If "Time is of the Essence" does
234not apply to a date or Deadline, then performance within a reasonable time of the date or Deadline is allowed before a breach occurs.
235ALLOCATION OF PURCHASE PRICECHECK LINE 236 OR 245
236
The Parties agree to the following allocation of the purchase price:
237
Goodwill:
$ __________________________________________
238
Stock-in-trade (inventory):
239
Accounts receivable:
240
Business Personal Property:
241
Real Estate Interest:
242
Other:
243
244
Total
245
The Parties shall agree in writing on an allocation by the following deadline: (within _________________ days of acceptance of
246
the Offer) (_______________________________, _________)
STRIKE AND COMPLETE AS APPLICABLE.
If the Parties cannot
247
agree on an allocation by the deadline either Party may, within 5 days following the deadline, deliver written notice to terminate and
248
all earnest money shall be returned to Buyer. If no notice is delivered by either party within such 5 day period, the Parties agree to
249proceed to closing and separately allocate the purchase price.
250CAUTION: Failure of the parties to agree on an allocation of purchase price prior to closing may have tax implications. Fair
251market value of the real property must be determined prior to closing to complete the transfer return per Wis. Stat. § 77.22.
252The Parties should consult accountants, legal counsel or other appropriate experts, as necessary.
253
ENVIRONMENTAL EVALUATION CONTINGENCY: This Offer is contingent upon a qualified independent environmental
254consultant of Buyer’s choice conducting an Environmental Site Assessment of the Real Estate (see lines 544-559), at (Buyer’s)
255(Seller’s) STRIKE ONE (“Buyer’s” if neither is stricken) expense, which discloses no Defects. For the purpose of this contingency, a
256Defect (see lines 538-540) is defined to also include a material violation of environmental laws, a material contingent liability affecting
257the Real Estate arising under any environmental laws, the presence of an underground storage tank(s) or material levels of
258hazardous substances either on the Real Estate or presenting a significant risk of contaminating the Real Estate due to future
259migration from other properties. Defects do not include conditions the nature and extent of which Buyer had actual knowledge or
260written notice before signing the Offer.
261CAUTION: The Parties should consider additional environmental inspection or testing contingencies of the Assets.
262■ CONTINGENCY SATISFACTION: This contingency shall be deemed satisfied unless Buyer, within ______________________
263days of acceptance, delivers to Seller a copy of the Environmental Site Assessment report and a written notice listing the Defect(s)
264identified in the Environmental Site Assessment report to which Buyer objects (Notice of Defects).
265CAUTION: A proposed amendment is not a Notice of Defects and will not satisfy this notice requirement.
266■ RIGHT TO CURE: Seller (shall) (shall not) STRIKE ONE (“shall” if neither is stricken) have a right to cure the Defects. If Seller has
267the right to cure, Seller may satisfy this contingency by: (1) delivering written notice to Buyer within 10 days of Buyer's delivery of the
268Notice of Defects stating Seller’s election to cure Defects, (2) curing the Defects in a good and workmanlike manner and (3)
269delivering to Buyer a written report detailing the work done within 3 days prior to closing. This Offer shall be null and void if Buyer
270makes timely delivery of the Notice of Defects and written Environmental Site Assessment report and: (1) Seller does not have a right
271to cure or (2) Seller has a right to cure but: (a) Seller delivers written notice that Seller will not cure or (b) Seller does not timely
272deliver the written notice of election to cure.
273CLOSING Legal possession of the Assets shall be delivered to Buyer at the time of closing. This transaction is to be closed no later
274than _____________________________________ at the place selected by Seller, unless otherwise agreed by the Parties in writing.
275CLOSING PRORATIONS The following items, if applicable, shall be prorated at closing, based upon date of closing values: real
276estate taxes, personal property taxes, rents, prepaid insurance (if transferred), private and municipal charges, property owners
277association assessments, fuel, other prepaid amounts for items being transferred to Buyer, and _______________________
278_________________________________________________________________________________________________________.
279CAUTION: Provide basis for utility charges, fuel or other prorations if date of closing value will not be used.
280Any income, taxes or expenses shall accrue to Seller, and be prorated at closing, through the day prior to closing. Personal property
281taxes shall be prorated based on (the taxes for the current year, if known, otherwise on the taxes for the preceding year)
282( ________________________________________________________________) STRIKE AND COMPLETE AS APPLICABLE.
283Real estate taxes shall be prorated at closing based on CHECK BOX FOR APPLICABLE PRORATION FORMULA:
284
The net general real estate taxes for the preceding year, or the current year if available (Net general real estate taxes are
285defined as general property taxes after state tax credits and lottery credits are deducted) (NOTE: THIS CHOICE APPLIES IF NO
286BOX IS CHECKED)
287
Current assessment times current mill rate (current means as of the date of closing)
Property Address: ________________________________________________________________________________________________________Page 6 of 14, WB-16
288
Sale price, multiplied by the municipality area-wide percent of fair market value used by the assessor in the prior year, or
289current year if known, multiplied by current mill rate (current means as of the date of closing)
290
_____________________________________________________________________________________________.
291 CAUTION: Buyer is informed that the actual real estate taxes for the year of closing and subsequent years may be 292 substantially different than the amount used for proration especially in transactions involving new construction, extensive 293 rehabilitation, remodeling or area-wide re-assessment. Buyer is encouraged to contact the local assessor regarding
294possible tax changes.
295
Buyer and Seller agree to re-prorate the real estate taxes, through the day prior to closing based upon the taxes on the
296actual tax bill for the year of closing, with Buyer and Seller each owing his or her pro-rata share. Buyer shall, within 5 days of
297receipt, forward a copy of the bill to the forwarding address Seller agrees to provide at closing. The Parties shall re-prorate within
29830 days of Buyer’s receipt of the actual tax bill. Buyer and Seller agree this is a post-closing obligation and is the responsibility of
299the Parties to complete, not the responsibility of the real estate brokers in this transaction.
300LEASED REAL ESTATE
301■ Real Estate Leased to Third Parties. CHECK AS APPLICABLE
302
For any Real Estate included in the purchase price which is owned by Seller and leased to third parties and such lease(s)
303extend beyond closing, Seller shall assign Seller’s interests and rights under the lease(s) and transfer all security deposits and
304prepaid rents thereunder to Buyer at closing. The terms of the (written) (oral) STRIKE ONE lease(s), if any, are ________________
305_________________________________________________________________________________________________________.
306
Seller agrees the lease(s) for the following Real Estate currently owned by Seller and leased to third parties shall terminate
307
at closing: _________________________________________________________________________________________________
308_____________________________________________________________________________________________.
309■ Real Estate Owned by Seller. If the Real Estate occupied by the Business is owned by Seller, but not sold by this Offer:
310CHECK AS APPLICABLE
311
Seller agrees to lease the Real Estate to Buyer at closing on the following terms: _________________________________
312__________________________________________________________________________________________________________
313________________________________________________________________________________.
314
Seller agrees to lease the Real Estate to Buyer at closing according to the terms of the lease attached to this Offer as an
315addendum per line 698.
316
This Offer is contingent upon Seller and Buyer, within ______ days from acceptance of this Offer, negotiating the terms of
317
a written lease for the Real Estate to be executed at closing, with a minimum term from ____________ to _____________ and
318minimum initial rent of $ ____________ per month STRIKE AND COMPLETE AS APPLICABLE or this Offer shall be null and void.
319■ Real Estate Leased to Seller. If the Real Estate occupied by the Business is owned by a third party and leased to Seller, then
320CHECK AS APPLICABLE
321
Seller agrees to assign its interest in the lease for the Real Estate to Buyer, if assignable. (See lines 21-30.)
322
This Offer is contingent upon the third party and Buyer, within ______ days from acceptance of this Offer, negotiating the
323
terms of a written lease for the Real Estate to be executed at closing, with a minimum term from ________________ to
324
___________________ and an initial maximum rent of $ __________________ per month
STRIKE AND COMPLETE AS
325APPLICABLE or this Offer shall be null and void.
326LEASED ASSETS (OTHER THAN REAL ESTATE)
327■ Assets Leased to Third Parties. CHECK AS APPLICABLE
328
For non-real property Assets included in the purchase price which are owned by Seller and leased to third parties and
329such lease(s) extend beyond closing, Seller shall assign Seller’s interests and rights under the lease(s) and transfer all security
330deposits and prepaid rents thereunder to Buyer at closing. The terms of the (written) (oral) STRIKE ONE lease(s), if any, are
331__________________________________________________________________________________________________________
332_________________________________________________________________________________________________________.
333
Seller agrees the lease(s) for the following Assets currently owned by Seller and leased to third parties shall terminate at
334closing:____________________________________________________________________________________________________
335__________________________________________________________________________________________________________.
336■ Assets Owned by Seller. If Assets are used by the Business and owned by Seller, but not sold by this Offer, Seller:
337CHECK AS APPLICABLE
338
Seller agrees to lease the following listed Assets to Buyer at closing on the following terms: _______________________
339__________________________________________________________________________________________________________
340__________________________________________________________________________________________________________.
341
Seller agrees to lease the following listed Assets to Buyer at closing according to the terms of the lease(s) attached to this
342Offer as an addendum per line 698. Assets: ______________________________________________________________________
343
This Offer is contingent upon Seller and Buyer, within _________ days from acceptance of this Offer, negotiating the terms
344of a written lease(s) for the following listed Assets to be executed at closing, with a minimum term(s) from ___________________ to
Property Address: ________________________________________________________________________________________________________Page 7 of 14, WB-16
345 ____________________ and minimum initial rent(s) of $ ____________ per month STRIKE AND COMPLETE AS APPLICABLE or
346this Offer shall be null and void. Assets: _________________________________________________________________________
347■ Assets Leased to Seller. If Assets used by the Business are owned by a third party and leased to Seller, then
348CHECK AS APPLICABLE
349
Seller agrees to assign its interest in the lease(s) for the following listed Assets to Buyer, if assignable. (See lines 31-47.)
350Assets: ______________________________________________________________
351
This Offer is contingent upon the third party and Buyer, within __________ days from acceptance of this Offer, negotiating
352the terms of a written lease(s) for the following listed Assets to be executed at closing, with a minimum term(s) from ___________ to
353____________ and an initial maximum rent(s) of $ ____________ per month STRIKE AND COMPLETE AS APPLICABLE or this
354Offer shall be null and void. Assets: ____________________________________________________________________________.
355
PROPOSED USE CONTINGENCIES: Buyer is purchasing the Assets for the purpose of: ______________________________
356__________________________________________________________________________________________________________
357________________________________________________________________________ [insert proposed use and type and size of
358the Assets or Business, if applicable; e.g., restaurant and tavern business with capacity of 350 and 3 second floor dwelling units]. The
359optional provisions checked on lines 363-381 shall be deemed satisfied unless Buyer delivers to Seller by the deadline(s) set forth on
360lines 363-381 written notice specifying those items which cannot be satisfied and written evidence substantiating why each specific
361item included in Buyer’s notice cannot be satisfied. Upon delivery of Buyer’s notice, this Offer shall be null and void. Seller agrees to
362cooperate with Buyer as necessary to satisfy the contingencies checked at lines 363-381.
363
EASEMENTS AND RESTRICTIONS: This Offer is contingent upon Buyer obtaining, within ______________________ days
364of acceptance, at (Buyer’s) (Seller’s) STRIKE ONE (“Buyer’s” if neither is stricken) expense, copies of all public and private
365easements, covenants and restrictions affecting the Assets and a written determination by a qualified independent third party that
366none of these prohibit or significantly delay or increase the costs of the proposed use or development identified at lines 355-357.
367 APPROVALS: This Offer is contingent upon Buyer obtaining, at (Buyer’s) (Seller’s) STRIKE ONE (“Buyer’s” if neither is
368stricken) expense, all applicable governmental permits, approvals and licenses, as necessary and appropriate, or the final
369discretionary action by the granting authority prior to the issuance of such permits, approvals and licenses, for the following items
370related to Buyer’s proposed use: _____________________________________________________________________________
371_____________ or delivering written notice to Seller if the item(s) cannot be obtained or can only be obtained subject to conditions
372which significantly increase the cost of Buyer’s proposed use, all within __________________ days of acceptance of this Offer.
373
ACCESS TO PROPERTY: This Offer is contingent upon Buyer obtaining, within ___________ days of acceptance, at
374(Buyer’s) (Seller’s) STRIKE ONE (“Buyer’s” if neither is stricken) expense, written verification that there is legal vehicular access to
375the Assets from public roads.
376 LAND USE APPROVAL: This Offer is contingent upon Buyer obtaining, at (Buyer’s) (Seller’s) STRIKE ONE (“Buyer’s” if
377
neither is stricken) expense, a
rezoning;
conditional use permit;
license;
variance;
building permit;
378
occupancy permit;
other ____________________________________________________________________________
379CHECK ALL THAT APPLY, for the Assets for its proposed use described at lines 355-357 or delivering written notice to Seller if
380the item(s) cannot be obtained or can only be obtained subject to conditions which significantly increase the cost of Buyer’s
381proposed use, all within __________ ______________ days of acceptance.
382DOCUMENT REVIEW/RECEIPT CONTINGENCY
383■ BUYER OBTAINING DOCUMENTS: This Offer is contingent upon Buyer, at Buyer’s expense, being able to obtain the following
384within the number of days of acceptance specified in each item checked below (consider addressing licenses, permits, etc.)
385
___________________________________________________________________________________________
(___ days).
386
387
___________________________________________________________________________________________ (___ days).
388
This contingency shall be deemed satisfied unless Buyer, within ________ days of the earlier of: 1) receipt of the final document to
389be obtained by Buyer or 2) the latter of the deadlines for Buyer obtaining the documents, delivers to Seller a written notice indicating
390that this contingency has not been satisfied. The notice shall identify which document(s) (a) cannot be timely obtained and why they
391cannot be obtained, or (b) do not meet the standard set forth for the document(s).
392■ BUYER TERMINATION RIGHTS: If Buyer cannot obtain any document by the stated deadline; Buyer may terminate this Offer if
393Buyer delivers a written notice of termination to Seller.
394■ SELLER DELIVERING DOCUMENTS: This Offer is contingent upon Seller delivering the following documents to Buyer within the
395number of days of acceptance specified in each item checked below. All documents Seller delivers to Buyer shall be true, accurate,
396current and complete.
397
Documents showing the sale of the Assets has been properly authorized, if Seller is a business entity (______ days).
398
A complete inventory of all included Business Personal Property which shall be consistent with all prior representations
399(______ days).
400 Uniform Commercial Code lien search as to the Business Personal Property included in the purchase price, showing the 401 Business Personal Property to be free and clear of all liens, other than liens to be released prior to or from the proceeds of closing
402(______ days).
403
Copies of all leases affecting the Assets, which shall be consistent with all prior representations (______days).
404
Estimated principal balance of accounts receivable and payable which shall be consistent with all prior representations
405(______ days).
406 Copy of profit and loss statements, balance sheets, business books and records, and income tax returns for the following years 407 _________________________________________________ which shall be consistent with all prior representations (______days).
Property Address: ________________________________________________________________________________________________________Page 8 of 14, WB-16
408 Copies of all current licenses held by Business which indicate that Business holds all licenses required for current operations
409(______ days).
410
Copies of franchise agreements, if any, which shall be consistent with all prior representations (______ days).
411
Any agreements restricting Seller from competing with Buyer after closing which shall be consistent with all prior
412representations (______ days).
413 Other ________________________________________________________________________________________________
414 Other ________________________________________________________________________________________________
415 Other ________________________________________________________________________________________________
416 This contingency shall be deemed satisfied unless Buyer, within ________ days of the earlier of: 1) Buyer’s receipt of the final
417 document to be delivered by Seller; or 2) the latter of the deadlines for delivery of the documents, delivers to Seller a written notice 418 indicating that this contingency has not been satisfied. The notice shall identify which document(s): (a) have not been timely 419 delivered; or (b) do not meet the standard set forth for the document(s). Buyer shall keep all such documents confidential and
420disclose them to third parties only to the extent necessary to implement other provisions of this Offer.
421■ BUYER TERMINATION RIGHTS: If Seller does not make timely delivery of any document by the stated deadline; Buyer may
422terminate this Offer if Buyer delivers a written notice of termination to Seller prior to Buyer’s Actual Receipt of the document(s)
423identified in Buyer’s written notice as not having been timely received. Buyer shall return all documents (originals and any
424reproductions) to Seller if this Offer is terminated.
425TITLE EVIDENCE
426■ CONVEYANCE OF TITLE: Upon payment of the purchase price, Seller shall convey the Real Estate by warranty deed
427((trustee’s deed if Seller is a trust, personal representative’s deed if Seller is an estate or other conveyance as provided
428herein) free and clear of all liens and encumbrances, except: municipal and zoning ordinances and agreements entered under them,
429recorded easements for the distribution of utility and municipal services, recorded building and use restrictions and covenants,
430general taxes levied in the year of closing and ___________________________________________________________________
431___________________________________________________________________ (provided none of the foregoing prohibit present
432use of the real property), which constitutes merchantable title for purposes of this transaction. Seller further agrees to complete and
433execute the documents necessary to record the conveyance. WARNING: Municipal and zoning ordinances, recorded building
434and use restrictions, covenants and easements may prohibit certain improvements or uses and therefore should be
435reviewed, particularly if Buyer contemplates making improvements to the Assets or a use other than the current use.
436■ TITLE EVIDENCE: Seller shall give evidence of title to the Real Estate in the form of an owner’s policy of title insurance in the
437amount of the value of the Real Estate on a current ALTA form issued by an insurer licensed to write title insurance in Wisconsin.
438Seller shall pay all costs of providing title evidence to Buyer. Buyer shall pay all costs of providing title evidence required by Buyer’s
439lender.
440CAUTION: MODIFY AMOUNT OF OWNER’S POLICY OF TITLE INSURANCE IF TITLE POLICY WILL INSURE TITLE TO
441ASSETS OTHER THAN REAL ESTATE.
442■ GAP ENDORSEMENT: Seller shall provide a “gap” endorsement or equivalent gap coverage at (Seller’s) (Buyer’s) STRIKE ONE
443(“Seller’s” if neither stricken) cost to provide coverage for any liens or encumbrances first filed or recorded after the effective date of
444the title insurance commitment and before the deed is recorded, subject to the title insurance policy exclusions and exceptions,
445provided the title company will issue the endorsement. If a gap endorsement or equivalent gap coverage is not available, Buyer may
446give written notice that title is not acceptable for closing (see lines 452-459).
447■ PROVISION OF MERCHANTABLE TITLE: For purposes of closing, title evidence shall be acceptable if the required title insurance
448commitment is delivered to Buyer’s attorney or Buyer not more than _________________ days after acceptance (“15” if left blank),
449showing title to the Real Estate as of a date no more than _________________ days, before delivery (“15” if left blank) of such title
450evidence to be merchantable per lines 426-432, subject only to liens which will be paid out of the proceeds of closing and standard
451title insurance requirements and exceptions, as appropriate.
452■ TITLE NOT ACCEPTABLE FOR CLOSING: If title to the Real Estate is not acceptable for closing, Buyer shall notify Seller in
453writing of objections to title within _____________ days (“15” if left blank) after delivery of the title commitment to Buyer or Buyer’s
454attorney. In such event, Seller shall have a reasonable time, but not exceeding _____________ days (“5” if left blank), from Buyer’s
455delivery of the notice stating title objections, to deliver notice to Buyer stating Seller’s election to remove the objections by the time
456set for closing. In the event that Seller is unable to remove said objections, Buyer may deliver to Seller written notice waiving the
457objections, and the time for closing shall be extended accordingly. If Buyer does not waive the objections, Buyer shall deliver written
458notice of termination and this Offer shall be null and void. Providing title evidence acceptable for closing does not extinguish Seller’s
459obligations to give merchantable title to Buyer.
460RENTAL WEATHERIZATION This transaction (is) (is not) STRIKE ONE (“is” if neither is stricken) exempt from Wisconsin Rental
461Weatherization Standards (Wis. Admin. Code, Ch. SPS 367). If not exempt, (Buyer) (Seller) STRIKE ONE (“Buyer” if neither is
462stricken) shall be responsible for compliance, including all costs with Wisconsin Rental Weatherization Standards. If Seller is
463responsible for compliance, Seller shall provide a Certificate of Compliance at closing.
Page 9 of 14, WB-16
464DEFINITIONS CONTINUED FROM PAGE 4
465■ CONDITIONS AFFECTING THE BUSINESS, ASSETS OR TRANSACTION: A “Condition Affecting the Business, Assets or
466Transaction” is defined to include, but is not limited to, the following:
467(a) Proposed, planned or commenced public improvements which may result in special assessments or otherwise materially affect
468the Business or Assets, or the present use of the Business or Assets;
469(b) Violation of federal, state or local regulations, ordinances, laws or rules; any government agency or court orders requiring repair,
470alteration or correction of any existing condition; or any potential, threatened or pending claims against the Business or its agents or
471materially affecting the Assets;
472(c) Material violation of the Americans with Disabilities Act (ADA) or other state or local laws requiring minimum accessibility for
473persons with disabilities. NOTE: A building owner’s or tenant’s obligations under the ADA may vary dependent upon the
474financial or other capabilities of the building owner or tenant;
475(d) Completed or pending reassessment of the Assets or any part thereof;
476(e) Structural or mechanical system inadequacies which if not repaired will significantly shorten the expected normal life of the
477Assets;
478(f) Zoning or building code violations, any land division involving the Assets for which required state or local approvals were not
479obtained, nonconforming structures or uses, conservation easements, rights-of-way, encroachments; easements, other than
480recorded utility easements; covenants, conditions and restrictions; zoning variances or conditional use permits; shared fences, walls,
481wells, driveways, signage or other shared usages; or leased parking;
482(g) Construction or remodeling on the Assets for which required federal, state or local approvals were not obtained;
483(h) Any portion of the Assets being in a 100 year floodplain, a wetland or shoreland zoning area under local, state or federal
484regulations;
485(i) That a structure which the Business occupies or which is located on the Real Estate sold by this Offer is designated as a historic
486building or that any part of a structure which the Business occupies or the Real Estate sold by this Offer is in a historic district; or
487burial sites or archeological artifacts on the Real Estate;
488(j) Material violations of environmental laws or other laws or agreements regulating the Business or the use of the Assets;
489(k) Conditions constituting a significant health or safety hazard for occupants, invitees or employees of the Business;
490(l) Unsafe concentrations of, or unsafe conditions relating to hazardous or toxic substances or medical or infectious waste located
491on the premises which the Business occupies or on the Assets; or previous storage or disposal of material amounts of hazardous or
492toxic substances or medical or infectious waste on the premises which the Business occupies or on the Assets;
493(m) Assets are subject to a mitigation plan required under administrative rules of the Department of Natural Resources related to
494county shoreland zoning ordinances, which obligates the owner of the Assets to establish or maintain certain measures related to
495shoreland conditions and which is enforceable by the county;
496(n) Flooding, standing water, drainage problems or other water problems on or affecting the Assets; material damage from fire,
497wind, floods, earthquake, expansive soils, erosion or landslides; or significant odor, noise, water intrusion or other irritants emanating
498from neighboring property;
499(o) A dam is totally or partially located on the Real Estate or that an ownership in a dam that is not located on the Real Estate will be
500transferred with the Real Estate because it is owned collectively by members of a homeowners association, lake district, or similar
501group. (If “yes,” contact the Wisconsin Department of Natural Resources to find out if dam transfer requirements or agency orders
502apply.);
503(p) Underground or aboveground storage tanks for storage of flammable, combustible or hazardous materials including, but not
504limited, to gasoline and heating oil, which are currently or which were previously located on the premises which the Business
505occupies or on the Assets (the owner, by law, may have to register the tanks with the Wisconsin Department of Agriculture, Trade
506and Consumer Protection at P.O. Box 8911, Madison, Wisconsin, 53708, whether the tanks are in use or not. Regulations of the
507Wisconsin Department of Agriculture, Trade and Consumer Protection may require the closure or removal of unused tanks.);
508(q) High voltage electric (100 KV or greater) or steel natural gas transmission lines located on but not directly serving the Business
509or Assets;
510(r) Any material Deficiencies in any of the equipment, appliances, business fixtures, fixtures, tools, furniture or other Business
511Personal Property included in the transaction;
512(s) Any encumbrances on the Business, all integral parts thereof, or the Assets, except as stated in this Offer and in any schedule
513attached to it;
514(t) Any litigation, condemnation action, government proceeding or investigation in progress, threatened or in prospect against or
515related to the Business or the Assets;
516(u) Any proposed road change, road work or change in road access which would materially affect the present use or access to the
517Business or the Assets;
518(v) Any right granted to underlying lien holder(s) to accelerate the debtor’s obligation by reason of the transfer of ownership of
519Business or the Assets, or any permission to transfer being required and not obtained;
520(w) Any unpaid Business taxes such as: income; sales; payroll; Social Security; unemployment; or any other employer/employee
521taxes due and payable or accrued; or any past due debts;
522(x) A material failure of the financial statements, or schedules to the financial statements, to present the true and correct condition of
523the Business as of the date of the statements and schedules or a material change in the financial condition or operations of the
Page 10 of 14, WB-16
524 Business since the date of the last financial statements and schedules provided by Seller, except for changes in the ordinary course
525of business which are not in the aggregate materially adverse;
526(y) Unresolved insurance claims, outstanding lease or contract agreements, back wages, due or claimed, product liability exposure,
527unpaid insurance premiums, unfair labor practice claims, unpaid past due debts;
528(z) Other Defects affecting the Real Estate, Deficiencies affecting the Assets, or conditions or occurrences which would significantly
529reduce the value of the Business or Assets to a reasonable person with knowledge of the nature and scope of the condition or
530occurrence.
531■ DEADLINES: “Deadlines” expressed as a number of “days” from an event, such as acceptance, are calculated by excluding the
532day the event occurred and by counting subsequent calendar days. The deadline expires at midnight on the last day. Deadlines
533expressed as a specific number of “business days” exclude Saturdays, Sundays, any legal public holiday under Wisconsin or Federal
534law, and other day designated by the President such that the postal service does not receive registered mail or make regular
535deliveries on that day. Deadlines expressed as a specific number of “hours” from the occurrence of an event, such as receipt of a
536notice, are calculated from the exact time of the event, and by counting 24 hours per calendar day. Deadlines expressed as a specific
537day of the calendar year or as the day of a specific event, such as closing, expire at midnight of that day.
538■ DEFECT: “Defect” means a condition that would have a significant adverse effect on the value of the Real Estate; that would
539significantly impair the health or safety of future occupants of the Real Estate; or that if not repaired, removed or replaced would
540significantly shorten or adversely affect the expected normal life of the premises.
541■ DEFICIENCY: “Deficiency” means an imperfection that materially impairs the worth or utility of an Asset other than Real Estate;
542makes such Asset unusable or significantly harmful; or substantially prevents such Asset from functioning or operating as designed
543or intended.
544■ ENVIRONMENTAL SITE ASSESSMENT: An “Environmental Site Assessment” (also known as a “Phase I Site Assessment”)(see
545lines 253-272) may include, but is not limited to: (1) an inspection of the Real Estate; (2) a review of the ownership and use history of
546the Real Estate, including a search of title records showing private ownership of the Real Estate for a period of 80 years prior to the
547visual inspection; (3) a review of historic and recent aerial photographs of the Real Estate, if available; (4) a review of environmental
548licenses, permits or orders issued with respect to the Real Estate; (5) an evaluation of results of any environmental sampling and
549analysis that has been conducted on the Real Estate; and (6) a review to determine if the Real Estate is listed in any of the written
550compilations of sites or facilities considered to pose a threat to human health or the environment including the National Priorities List,
551the Department of Natural Resources’ (DNR) registry of Waste Disposal Sites, the DNR’s Contaminated Lands Environmental Action
552Network, and the DNR’s Remediation and Redevelopment (RR) Sites Map including the Geographical Information System (GIS)
553Registry and related resources. Any Environmental Site Assessment performed under this Offer shall comply with generally
554recognized industry standards (e.g. current American Society of Testing and Materials “Standard Practice for Environmental Site
555Assessments”), and state and federal guidelines, as applicable.
556CAUTION: Unless otherwise agreed an Environmental Site Assessment does not include subsurface testing of the soil or
557groundwater or other testing of the Real Estate for environmental pollution. If further investigation is required, insert
558provisions for a Phase II Site Assessment (collection and analysis of samples), Phase III Environmental Site Assessment
559(evaluation of remediation alternatives) or other site evaluation at lines 699-713 or attach as an addendum per line 698.
560■ FIXTURES: A “Fixture” is an item of property, which is on the Real Estate on the date of this Offer, which is physically attached to
561or so closely associated with land and improvements so as to be treated as part of the real estate, including, without limitation,
562physically attached items not easily removable without damage to the premises, items specifically adapted to the premises, and
563items customarily treated as fixtures, including, but not limited to, all: garden bulbs; plants; shrubs and trees; screen and storm doors
564and windows; electric lighting fixtures; window shades; curtain and traverse rods; blinds and shutters; central heating and cooling
565units and attached equipment; water heaters and treatment systems; sump pumps; attached or fitted floor coverings; awnings;
566
attached antennas; overhead door openers
and remote
controls; installed security systems; central vacuum systems and
567
accessories; in-ground sprinkler systems and
component
parts; built-in appliances; ceiling fans; fences; storage buildings on
568permanent foundations and docks/piers on permanent foundations. A Fixture does not include trade fixtures owned by tenants of the
569Real Estate.
570CAUTION: Exclude Fixtures not owned by Seller such as rented fixtures. See lines 48-52.
Once an offer to purchase a business that includes real estate interests is ready to be made, the WB-16 form serves as a formal proposal. This document outlines the terms under which the buyer proposes to purchase the business and associated real estate from the seller. The following steps guide you through filling out the WB-16 form to ensure all the necessary information is accurately and comprehensively provided, facilitating a clear agreement between the buyer and seller.
It is crucial to read every part of the form carefully to ensure that all provisions and contingencies are understood and accurately reflected. This document serves as a binding contract once accepted, and consulting with a legal professional is recommended if you have any questions or need clarification on specific terms.
What is the WB-16 form?
The WB-16 form, entitled "Offer to Purchase – Business With Real Estate Interest," is a legally binding document used in the state of Wisconsin. It outlines the terms and conditions under which a buyer offers to purchase a business that includes an interest in real estate. This comprehensive form addresses the purchase price, earnest money, descriptions of the real estate and other assets included in the sale, representations, and various legal obligations of both parties.
Who needs to use the WB-16 form?
Individuals or entities looking to purchase or sell a business in Wisconsin that comes with an interest in real estate should utilize the WB-16 form. It ensures that all aspects of the transaction are clearly defined and legally documented, providing protections for both the buyer and the seller.
When should the WB-16 form be used?
This form should be used when making an offer to purchase a business that includes real estate within the state of Wisconsin. Its detailed provisions allow parties to carefully define the specifics of the sale, making it essential from the onset of a transaction. The Mandatory Use Date mentioned on the form indicates when its usage became required for such transactions.
What kind of information is required on the WB-16 form?
The form requires detailed information about the buyer and the seller, the business being sold, the real estate interest included in the purchase, the purchase price, and how it's to be paid. It also delves into specifics such as the description of assets included or excluded from the sale, earnest money details, allocation of the purchase price among various assets, and legal conditions or contingencies directly affecting the offer and sale.
How is earnest money handled according to the WB-16 form?
According to the form, earnest money accompanies the offer and must be delivered within a specified period after acceptance. It details how the earnest money should be held and eventually applied to the purchase price or disbursed based on the outcome of the transaction. Detailed instructions are provided for the disbursement of earnest money in the event that the transaction does not close.
Are there any contingencies in the WB-16 form?
Yes, the form allows for various contingencies that must be met for the transaction to proceed, including environmental evaluations, inspections and testing, and the buyer's pre-closing view of the assets. These contingencies help protect the buyer by allowing them to verify the condition of the business and real estate before finalizing the purchase. Specific contingencies can be included or excluded based on the agreement between the buyer and the seller.
What happens if there is a default according to the WB-16 form?
The WB-16 form outlines the legal steps that can be taken if either the buyer or the seller fails to meet their obligations as outlined in the offer. It details remedies for default, including specific performance, termination of the offer, and claims for damages. The form aims to make clear the consequences of not adhering to the contract's terms.
Can the WB-16 form be withdrawn?
Yes, the offer outlined on the WB-16 form can be withdrawn prior to the delivery of the accepted offer. However, it specifies that this action should comply with all the conditions outlined in the contract, including notification periods and the manner of withdrawal.
Is legal advice required to complete the WB-16 form?
While real estate brokers can provide general explanations of the form's provisions, they are prohibited by law from giving legal advice. It is highly recommended that parties involved in the transaction consult with an attorney for legal advice, especially to understand their rights and obligations under the contract fully. Attorneys can offer invaluable guidance on completing the form according to the parties' specific circumstances and legal requirements.
One common mistake people make when filling out the WB-16 Offer to Purchase – Business With Real Estate form is not correctly identifying the agent role in section 1. This oversight can lead to confusion about whose interests the agent represents, potentially skewing negotiations. It's crucial to strike through the non-applicable options to clearly state whether the agent is acting on behalf of the buyer, seller, or both.
Another frequent error involves inaccurately detailing the business entity and its structure in sections 3 and 4. This can have significant legal implications, affecting everything from liability to tax obligations. Providing a precise and complete description of the business, including its legal name, trade names, and type of entity, is essential for a transparent and enforceable agreement.
In section 14, related to the purchase price, an all-too-common mistake is failing to write out the purchase amount in words as well as figures. This can lead to disputes if the numbers are not clear. Ensuring both the written and numerical formats match and are clear is crucial to prevent any misunderstandings regarding the agreed-upon price.
Many also overlook the importance of specifying earnest money details in sections 16 and 17. Neglecting to outline the exact amount and when it will be delivered can lead to disputes over the serious intent and financial stability of the buying party. This step is vital for the seller’s peace of mind and the integrity of the transaction.
The description of assets included in the purchase price, detailed in sections 21 through 33, is often not comprehensive enough. This leads to confusion and potential legal disputes post-sale about what was actually included in the sale. It’s imperative to list all components of the sale clearly, ensuring both parties have the same understanding of what is being transferred.
Frequently, parties fail to adequately address the allocation of the purchase price among different types of assets (sections 236-245). This mistake can have significant tax implications for both parties. An agreement on price allocation, reflective of fair market values to the extent possible, should be reached to avoid unintended financial consequences.
The delivery method for documents and notices, as outlined in sections 66 through 84, is often overlooked. Failure to establish effective communication channels can lead to missed notices and deadlines, potentially derailing the sale. Parties should agree upon and clearly document preferred methods of delivery to ensure all communications are received in a timely manner.
Another error involves not properly addressing the closing and possession details in sections 273 through 275. Vague or missing information about when and where closing will take place, along with when possession will be transferred, can lead to last-minute complications. A clear agreement on these points helps ensure a smooth transition.
Finally, a notable mistake is not correctly handling contingencies, especially the environmental evaluation contingency in section 254. Omitting this or not providing adequate time for the assessment and response can expose the buyer to unforeseen liabilities. Properly addressing contingencies protects both parties and ensures a fair and informed transaction.
When handling transactions outlined in the WB-16 Offer to Purchase – Business with Real Estate Interest form, several other documents and forms often play crucial roles in the seamless execution of a deal. These documents not only complement the Offer to Purchase but also provide further details, protections, and legal clarifications for both the buyer and seller involved in the transaction.
This collection of documents ensures transparency, accuracy, and fairness in the transaction process, safeguarding both parties' interests. Each form serves a specific purpose, from detailing the assets and liabilities involved in the sale to modifying pre-existing agreements and confirming the state of the real estate involved. They play a critical role in the documentation and finalization of the transaction, ensuring that both buyer and seller are well-informed and agree to the terms of the sale.
Similar to the WB-16 form, the WB-11 Residential Offer to Purchase focuses on the acquisition of real estate, this time specifically residential property. Both documents serve the crucial purpose of laying out the terms and conditions of an offer, including purchase price, financing, and contingencies like inspections. The main difference lies in the type of property each targets, with WB-11 being designed for residential use.
The WB-13 Vacant Land Offer to Purchase is another form in the realm of property transactions, concentrating on vacant land. Like WB-16, it details aspects such as purchase price, earnest money, and specific contingencies related to the land's condition and permitted uses. Both forms are tailored to their specific transaction types but share a common structure for laying out the transaction's terms and ensuring legal and financial clarity.
For commercial real estate transactions, the WB-15 Commercial Offer to Purchase parallels the WB-16 form but is meant for commercial property transactions without the business aspect. It encompasses terms regarding the purchase price, contingencies, zoning, and environmental considerations specific to commercial properties, highlighting the forms' adaptability to various property types while maintaining a core contractual function.
In the realm of leasing, the WB-35 Simultaneous Exchange Agreement shares similarities with WB-16 in structuring a real estate transaction. However, its focus is on exchanges rather than straightforward purchases, outlining terms for properties exchanged between parties, including valuation and transfer conditions. This document, while distinct in its exchange focus, parallels WB-16's purpose of delineating transaction specifications in real estate dealings.
The WB-40 Amendment to Offer to Purchase allows parties to modify terms in the original offer, similar to how changes might be made to a WB-16 agreement. This adaptability is crucial in real estate transactions where negotiations or unseen circumstances can drive changes to terms like the closing date, purchase price, or contingencies, reflecting the dynamic nature of property transactions.
The WB-41 Notice Relating to Offer to Purchase functions as a communication tool in transactions, like how conditions in a WB-16 might be clarified or finalized. It enables parties to relay information crucial to the fulfillment or alteration of the contract, emphasizing the importance of clear communication in successfully concluding real estate transactions.
Another related document, the WB-25 Bill of Sale, complements the WB-16 form when personal property or business assets are part of the real estate transaction. It specifies the transfer of ownership for items included in the sale, detailing what personal or business property is being transferred as part of the deal, thereby covering aspects that the WB-16 hints at but doesn't fully specify.
The WB-45 Cancellation Agreement and Mutual Release addresses the termination of an agreement, like a failed WB-16 transaction. It provides a protocol for both parties to agreeably back out of the transaction, detailing the disposition of any earnest money and releasing each other from obligations, underscoring the necessity for an exit strategy in contracts.
Last but not least, the WB-46 Multiple Counter-Proposal document allows sellers to counter multiple offers simultaneously, an aspect that can be relevant in competitive bidding situations for businesses with real estate interests as in WB-16 scenarios. It manages the complexity of dealing with multiple interested parties, ensuring that sellers can navigate through various offers while striving for the best outcome.
These documents collectively cater to a broad spectrum of real estate transactions, from residential and commercial purchases to leasing and exchanges. Each is tailored to specific transaction types, yet they share the objective of providing a clear, contractual framework that outlines rights, responsibilities, and expectations of all parties involved.
When filling out the WB-16 form, which is an essential document for the purchase of a business with a real estate interest in Wisconsin, attention to detail cannot be overstressed. To ensure a smooth and error-free submission, here are essential dos and don'ts to consider:
Adhering to these guidelines will help ensure the WB-16 form is accurately completed, thus facilitating a smoother transaction process for all parties involved.
When dealing with the WB-16 form, which is utilized for offers to purchase businesses that include real estate interests in Wisconsin, several misconceptions can arise. Clearing up these misconceptions is essential for both buyers and sellers to ensure that the process runs smoothly. Below are nine common misconceptions about the WB-16 form and the facts that debunk them.
Misconception 1: The WB-16 form is only for the purchase of the physical property of a business. Reality: The WB-16 form covers not only the real estate but also the purchase of business assets, including goodwill, stock-in-trade, trade fixtures, and more, making it comprehensive for business sales that include real estate.
Misconception 2: The earnest money is non-refundable under all circumstances. Reality: The disposition of earnest money depends on the terms of the offer and the occurrence of certain conditions or contingencies. Earnest money can be refunded if specific conditions warrant it.
Misconception 3: The buyer automatically assumes all leases and contracts associated with the business. Reality: The assumption of leases, contracts, or other obligations must be explicitly stated in the offer. Without such provisions, the buyer may not be obligated to assume them.
Misconception 4: All business personal property is included in the sale. Reality: The inclusion of personal property items must be clearly listed in the offer. Some assets may be excluded or subject to separate negotiation.
Misconception 5: The seller is responsible for all repairs and conditions up to closing. Reality: While the seller is often responsible for maintaining the property until closing, specific terms regarding repairs and the condition of the property at closing must be agreed upon by both parties in the offer.
Misconception 6: The use of the WB-16 form eliminates the need for legal or professional advice. Reality: Although the WB-16 form is comprehensive, consulting with legal counsel, accountants, or other professionals is advisable to navigate the complex issues that can arise during the purchase or sale of a business with real estate interests.
Misconception 7: The closing date is fixed and cannot be changed. Reality: The closing date can be modified if both the buyer and seller agree to the change in writing. Flexibility may be necessary due to financing, inspections, or other contingencies.
Misconception 8: The buyer is immediately responsible for all special assessments and taxes as of the offer date. Reality: Special assessments and taxes are prorated based on the closing date. The buyer and seller share these costs according to the time each party was in ownership.
Misconception 9: Completion of the WB-16 form guarantees the sale will close. Reality: Successfully closing the sale depends on fulfilling all terms of the offer, satisfying contingencies, and mutual agreement between the buyer and seller to proceed at each step of the process.
Understanding these aspects of the WB-16 form can help both buyers and sellers navigate the complexities of purchasing or selling a business that includes real estate interests, ensuring a clearer and more streamlined transaction process.
When working with the WB-16 form, which is the Offer to Purchase – Business With Real Estate Interest, it's important to understand the key elements to ensure the process goes smoothly. Below are four key takeaways:
Overall, filling out the WB-16 form requires careful attention to detail and an understanding of the legal and financial implications of the transaction. It's recommended that both buyers and sellers consult with professionals such as attorneys and accountants to fully comprehend their rights, obligations, and the potential impact on their interests.
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