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gfdiamond Regular user sweden 198 Posts |
What to do about people who want to invest in your show and give the runaround.
Situation: Rich guy comes to me and asks me if he can invest in my magic business. I say, sure that's ok, but I want it done in a business style way. No problem he says. OK, I draw up a contract which states its a business loan over 5 years, at a 7 % interest rate, and I agree to give him 10% of the future earnings of my stage show. He signs it, I sign it and his bank officer signs it. We all have a signed copy. After four weeks, still no sign of the money.. Frustrating, as I am trying to plan a major stage show around this. What would you do? regards, geoff diamond
Check me out on Google. Geoff Diamond Magician.
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Marshall Thornside Inner circle chicago 2016 Posts |
The good thing is that no money has exchanged hands. So you aren't paying 7% interest.
Have you called him since the signing of the contract? Did you have a lawyer look it over? What about the bank manager, have you spoke to him? Does it say in the contract that the money is be received within a specific time frame or elses voided?
you will remember my name
World's Youngest Illusionista 7th greatest pianist in the world Go Red For Women and Stroke Ambassador www.mai-ling.net |
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joshlondon17 Special user San Diego, CA 685 Posts |
Be aware of anyone approaching you for anything. That goes for agents especially. I'd say your legally OK as you've not received any money so you're not obligated to give him any of your earnings.
Josh |
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Jim Snack Inner circle 1338 Posts |
What would I do? I would call the guy and ask him what's going on. Is he defaulting on the agreement or what?
If the guy is having problems now, you should be very cautious about doing business with him. This may be an ideal opportunity for you to back out of an agreement with an unreliable partner. I haven't seen your contract, but I'm wondering what clauses were included for canceling the agreement, handling disputes, etc. These are things that should be covered in a contract and could specify how you proceed. Jim |
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Dannydoyle Eternal Order 21219 Posts |
Well traditionally the way a contract of this nature works is that at the time of the signing, the money is exchanged. Pretty simple really.
Forget the bank officer, get a lawyer. Have the lawyer draw up the contract. I am confused how this works really. He is "investing" in your magic business but he gets a 7% return on his money AND 10% of profits? There are 2 different ideas at play here. IF it is a loan it has to be drawn up as a loan, and he may be getting WAY too much back anyhow. 10% of total earnings could work out to 40% on the loan, which is not legal to charge. Ask the Mafia. IF it is simply an investment, then the 10% makes sense. You generally can't do both. There are very strict rules which govern loans and you will be caught up in them. Don't plan ANYTHING around this till you get it straight. A lawyer will help you tremendously. Basically the contract may very well be unenforceable as it may not be legal.
Danny Doyle
<BR>Semper Occultus <BR>In a time of universal deceit, telling the truth is a revolutionary act....George Orwell |
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rossmacrae Inner circle Arlington, Virginia 2475 Posts |
Red flag: "I drew up a contract..."
Are you an attorney? The contract should have been drawn up by one - you can bet a serious investor has one and uses him/her. They make the big bucks because they know how to avoid the thousand pitfalls that lie hidden under the surface of such a transaction. Send a letter declaring the contract void due to the investor's failure to fulfill his part in a reasonable time, and consider yourself lucky to have dodged a bullet. If you need a loan to fund improvements in your business, take out a loan with a bank (and make your business decisions within the framework of a thought-out business plan). If you need an investor, form a corporation and sheild your assets. |
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JeffWampler Regular user Bristol, TN 191 Posts |
Run...run...RUN!
As Danny said, if its a loan, then it's a loan. If its an investment in your business, then its an investment. All investments carry risks. This guy has no risk whatsoever. He either gets 7% of the loan or 10% of your profits...or is it both? Sounds shady to me. I'm a marketing guy and a fan of Dan Kennedy. In No BS Business Success Dan says that if you can't make money without money, you can't make money with money. I know you're wanting to get money together for a big stage show, but that may have to wait. Make money with smaller shows and put that money toward your big stage show. Its a longer, more painful process, but no more painful than having a garage full of stage show 5 years from now owing 7% on a big loan. |
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TheDean Inner circle Reno, Nevada 2164 Posts |
Another Opinion: (Based on experience) I'm 110% with Jeff on this one... RUN, do not walk the other direction!
This, “as you have described it”, is NOT an investment as much as it is an incredibly high-priced LOAN with a lifetime of never-ending pay-outs on YOUR END! Holy COW, NOT a good deal in the “investment” biz... accept for HIM! Get a lawyer and get out of this deal NOW if you can! Just some insights and experiences… do what you will. Thinking of YOU and your Success! I am at your service and in HIS Service, Deano (Back) in Reno <><
Dean Hankey, *M.D. - The Dean of Success Solutions!
Serving & Supporting YOU and Your Success! "Book More Shows... Make More Money... SERVE MORE PEOPLE! - Not Necessarily In That Order…" (*Marketing Doctor) |
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Review King Eternal Order 14446 Posts |
Trust has been broken: RUN!!!!!!!!!!!!!!!!
"Of all words of tongue and pen,
the saddest are, "It might have been" ..........John Greenleaf Whittier |
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magicofCurtis Inner circle Los Angeles 2545 Posts |
Investment contracts are usually written as interest on the money and/or a % of sale/business.... The % of the business is given until the investment is fully refunded or the matured date is reached.... However, the interest is usually canceled out when the sale/business is making money.... The interest is a back up incase the business is not a success....
Just my wisdom of the day.....
Curtis Lovell II
http://www.CurtisLovell.com http://www.MagicofCurtis.com www.facebook.com/curtislovellii Los Angeles, California - U.S.A. |
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Dannydoyle Eternal Order 21219 Posts |
As Deano points out this is not an investment at all but a loan with horrid terms and the worse part of this is that it never ends. Actually the better you do the more you pay!
PLUS 7% on a loan for if you fail. Not bad no wonder this guy got to be rich.
Danny Doyle
<BR>Semper Occultus <BR>In a time of universal deceit, telling the truth is a revolutionary act....George Orwell |
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TheDean Inner circle Reno, Nevada 2164 Posts |
Dead-On Danny! - You Da' Man!
Funny thing is, sometimes a REAL "investor" relationship can be a good thing, and those real relationships are rare, at best. This guy is just making money off you regardless... that is not an investor, that is a blood sucking vampire! Good work if you can get it like he seams to have! Hey , I'd give money under those terms... (If I had no constants!) no-risk, guaranteed money for ME! (Though, personally, I could never bring myself to do that deal, no matter how much money I made… but that is just me.) Honestly, if you CAN get OUT of this deal until you can find a TRUE “investment” deal with terms more favorable! Google “INVESTMENT Agreements” and you will se better what I am talking about. SURE an investor deserves to make good money as part of the REWARD of investing… that is more than fair, but to suck the life-blood out of someone who simply doesn’t know any better is dead-wrong! THAT is a “vampire” and deserve a steak right through the heart till dead! Again, just my experience and insights… do what works for YOU! Thinking of YOU and your Success! I am, as always, at your service and in HIS Service, Deano <><
Dean Hankey, *M.D. - The Dean of Success Solutions!
Serving & Supporting YOU and Your Success! "Book More Shows... Make More Money... SERVE MORE PEOPLE! - Not Necessarily In That Order…" (*Marketing Doctor) |
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Father Photius Grammar Host El Paso, TX (Formerly Amarillo) 17161 Posts |
Since you got no money, I'd say he failed on his part of the contract. Now it might be possible for you to sue him for breech of contract, but then it depends on how the contract was written. Based on the combination loan and percentage thing you had in there, I'd say you were lucky he gave you no money, and I'd still consult a lawyer to keep him from jumping up one day and trying to claim a part of your income, and never, never, never enter another contract your lawyer didn't draw up or approve.
"Now here's the man with the 25 cent hands, that two bit magician..."
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Dannydoyle Eternal Order 21219 Posts |
Oh this contract is not enforceable from either side. It has not been enacted and there has been no "meeting of the minds". There is no way this guy can jump up and do anything. With no money given, he has no consideration. It is simply a document he failed to sign plain and simple.
Next time, get a lawyer without question.
Danny Doyle
<BR>Semper Occultus <BR>In a time of universal deceit, telling the truth is a revolutionary act....George Orwell |
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gfdiamond Regular user sweden 198 Posts |
Hi guys,
thanks for your advice. I have since revamped the contract to have interest only. had a discussion with the investor and he is understanding also. will let you know outcomes. regards, geoff.
Check me out on Google. Geoff Diamond Magician.
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Dannydoyle Eternal Order 21219 Posts |
Teh advice you SHOULD have listened to was get a lawyer.
Danny Doyle
<BR>Semper Occultus <BR>In a time of universal deceit, telling the truth is a revolutionary act....George Orwell |
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gfdiamond Regular user sweden 198 Posts |
Hi danny,
I agree, however things are bit different here in sweden. its extremely regulated and its virtually impossible to sue anyone over anything. the court system is incredibly expensive for private cases as are lawyers for any reason. also, try paying around 10 bucks for a beer and you'll get the idea. regards, geoff.
Check me out on Google. Geoff Diamond Magician.
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Dannydoyle Eternal Order 21219 Posts |
OOOOOOOOOOOK
I feel it important to point out that you should now ignore 100% of everything I said. I have NO IDEA how things work in Sweeden, I was speaking in American terms, in American law and things that applied only here not across the pond. I have no idea about anyone else, but as for me, please ignore all my posts. No thanks on the $10 beer.
Danny Doyle
<BR>Semper Occultus <BR>In a time of universal deceit, telling the truth is a revolutionary act....George Orwell |
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kaytracy Inner circle Central California 1793 Posts |
The only thing that concerns me about you getting ripped off by this agreement you put together (other than all the above statements, and the need to have had a lawyer in this mix) is that you signed it with no money changing hands?
I made that mistake ONCE with a quit-claim agreement on some property- the person came with the agreement for the purchase, and wanted the money up front, but had forgotten to bring the quitclaim- "I will mail it to you in the morning..." According to the agreement I signed, I paid, and they turned over the paperwork- hmmmm, what paperwork "I gave it to you already - why are you harassing me?!" GET A LAWYER! Preferably one who does Business law! k
Kay and Tory
www.Bizarremagick.com |
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Dannydoyle Eternal Order 21219 Posts |
In America a contract needs to be executed, and with no monty changing hands, it seems as if this would not be enforceable. I have no idea how it works in Sweeden.
Danny Doyle
<BR>Semper Occultus <BR>In a time of universal deceit, telling the truth is a revolutionary act....George Orwell |
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