What should I ask about the host locations on an ATM route’s site agreements?
Ask for every site agreement and check who the contracting party is, how it can be ended, how the host is paid, and whether it can pass to a buyer. A machine sitting in a store is only as secure as the paper behind it, and some hosts may have to consent to a change of owner.
The host site is the real asset of an ATM route, because it decides whether the machine stays. Ask for a complete set of agreements and make a simple chart: location, contact person, payment arrangement, length, renewal terms and exit terms. Gaps in the chart matter as much as the entries.
Read the assignment language. Some agreements allow transfer to a buyer automatically, some need the host’s consent and some say nothing. Your lawyer can tell you which category each falls into and whether you should seek consent before closing. Ask about the host relationship. Who handles complaints, and has any host threatened to remove the machine or asked for a bigger share? Ask whether any location is on a handshake deal and whether the lease or ownership of the host premises is about to change. Check the economics location by location. A site with high use and a modest host payment is a very different proposition from one with low use and rising demands. Compare transaction records with the chart.
Consider asking the seller to introduce you to key hosts, which also tells you how the relationship really feels.
Key takeaways
- Build a location chart covering contacting party, term, renewal, payments and exit rights.
- Ask your lawyer which agreements need host consent to transfer.
- Introduce yourself to the most important hosts before closing.
- Compare each site’s transaction records with the location chart, because a busy site on weak terms differs sharply from a quiet one.
Related reading
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Selling
Succession
Sources
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- 01Business Development Bank of CanadaGovernmentWhat are the steps to buying a business?
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