Many orthodontic residents graduated in June, and many are now working with experienced orthodontists in the PCSO. Some of these people will enter sales or partnership agreements. A check list of topics for such agreements follows. This could give you something to prepare for before you visit an attorney to prepare the requisite documents.

Describe what is for sale:

• the orthodontic practice at what address
• current accounts receivable (past due accounts)
• contracts for future orthodontic services
• furniture, fixtures, and equipment
  (include inventory)
• files, books, records, and work papers
  (including computer records)
• trade and good will

• telephone listing and use of seller’s name
• leasehold interest

Describe the purchase price amount and how and when it is to be paid (include any promissory note).

Describe how the purchase price is allocated:

• patient records and work under contract
• furniture fixtures and equipment
• expendable supplies
• goodwill
• covenant not to compete

Describe the closing time and place
and the documents needed to execute the sale
from the buyer:

• promissory note (if applicable)
• security agreement (if applicable)

from the seller:

• assignment of lease or leasehold agreement
• bill of sale
• statement from the State Employment office
  indicating change of employer
• consent from spouse for the sale

Describe indemnification against obligations incurred by the seller prior to the date of sale and by the buyer after the date of sale.

Describe the seller’s covenant not to compete, noting the time period and the area.

Describe the buyer’s promise not to compete if the seller has to take back the practice.

Describe pro-rations of ongoing fixed expenses of the practice:

• taxes and insurance
• rent
• salaries
• utilities

Disclose broker’s fees and who is to pay them.

Include the common legal disclaimers as to representations and warranties, amendments, notices, arbitration and attorney’s fees in the event of legal action subsequent to the sale, inurement, and survival of representations and obligations.

Documents attached to the sale agreement might include:

• list of equipment included in the sale
• list of equipment not included in the sale
• promissory note
• security agreement
• spousal consent
• liens and encumbrances on the practice
• lease
• bill of sale

A broker and/or attorney will help you write the sales agreements. There are many other aspects to any sale, including appraisal and valuation, employment agreements, and loan agreements. ‘Tis the season.

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