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Old 07-14-2005, 10:19 PM   #1
savy
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Default Selling Websites

I'm in the process of selling one of my websites and an issue that has come up is precisely defining (in the contract) what is being sold.

I'm looking for input on how people usually define their websites in contracts without resorting to vague phrases, such as "intellectual property", that could cause problems in the future?

What makes up a website and how do you make sure you're not selling more than you intend? For instance some special coding technique you developed and used on the website, layout/graphic designs that you didn't end up using, or marketing strategies you learned (sorry those aren't great examples)?

Is listing filenames standard practice in contracts for selling websites? What files would you include -- just the ones currently in use, or every design you've used in the past, or other files that may not be used directly by the website?
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Old 07-15-2005, 12:06 AM   #2
Rivux
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For starters a sale should include all files that are needed to keep the site running as is, which may be some 'special coding technique' you came up with. Of the two dozen or sites Ive sold I will general include all marketing material Ive used, this will include things like banners, copies of newsletters and any print copy/ads we've done.

I will also generally include any past versions of the site design if I still have them, though its not really necessary I just like to make sure they have as much data as possible and its not like it costs any extra to give them this stuff.
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Old 07-19-2005, 02:48 PM   #3
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My opinion would be that you are selling whatever you agree to sell.

Wow. That's useless isn't it?

Well, ultimately it depends what your buyer wants, and what you want to get rid of, I don't think there are any 100% rules.

I would say that you include everything necessary for the website to function (although you might want to specifically exclude the resell rights to any special code you developed) and anything else like banner ads etc that help the website function.

Not sure about listing file names, it seems like a good idea but also "so what?"
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Old 07-19-2005, 03:17 PM   #4
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savy, It would be helpfull to know the amount of money involved (a realistic range) and the number of web pages on the site you wish to sell. If you have either custom scripts/coding or off the shelf scripts, then the details/names would also be helpfull.

This data "drives" the techniques and work involved in making both parties happy. For example, a deal for 100K on a site with 1000 pages will often involve an attorney and requires an escrow. A deal for $500 normally requires much less complexity and could simply be handled as the other memebers have suggested. The small deal like this:

Here is the tar/gz of the entire site on a given date. Here is the tar/gz of the MySQL database on a given date. Please review both untill you are satisified and then acknowledge same by typing your full name and date in the enclosed document, signing same and FAX back to me

Iv'e really only touched the surface since their are numerous issues involved in selling a site but I do hope I have provided some guidence based on your first post.

With more details, I'm confident that we can help you even more.

Good luck!

Last edited by Steve_S; 07-19-2005 at 03:18 PM.
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Old 07-19-2005, 09:25 PM   #5
savy
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Thanks for your responses!

I'm looking at around $15k USD for the site, so to be safe I'll be using an escrow service (escrow.com) along with an attorney. The person looking to buy the site has already sent the contract over. In addition to purchasing the site, they're asking me to stay on and keep the site updated for at least 1 year (for which they'd pay about another $15k).

The site has about 20-30 files (8-12 php files, some images, the database, etc).

The entire site was custom coded by myself, although there isn't anything "special", its all fairly basic coding.

In the contract, they refer to the site and all its "intellectual property". My lawyer (who isn't particularly familiar with selling websites, but he's the only one available to me) was concerned by that and recommended making the contract more precise so that I accidently sell "my brain" (ie, my coding/design techniques) or sell more than I intended since "intellectual property" could refer to anything.

Also, the intellectual property issue comes up during the 1 year I would be maintaining the site for them. I want to make sure that anything I think of doesn't automatically become their property. So, additionally, I guess I need to figure out how to clearly define "maintaining" a website.

So really I'm trying to come up with the most logical way to precisely limit what is being sold.
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Old 07-19-2005, 11:07 PM   #6
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savvy said

Also, the intellectual property issue comes up during the 1 year I would be maintaining the site for them. I want to make sure that anything I think of doesn't automatically become their property. So, additionally, I guess I need to figure out how to clearly define "maintaining" a website.

**That could be a problem, and you should be careful. If you are being hired on a fee for service basis for that year -- the most common approach, what you create will be THEIR property, at least anything you create that's relevant to that specific fee for service arrangement.. That's generally how "consulting" works.

They would be foolish to do it any other way. If you can convince them otherwise, more power to you, but if you are getting paid to work on their site, then it should belong to them.
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Old 07-20-2005, 12:47 PM   #7
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Double ditto to the point that geek rbacal makes. Thats standard practice. Given the additional data on the deal here are a few other things to think about and include:

1. A non compete clause which may in fact raise the price of the sale. Thus, you can't build another celeb site as an example.

2. What exactly can you do with the scripts source code for the site? Are you granting a non exclusive right which means you can also use it anyway you wish or an exclusive right which means you can't use it and the buyer can use it any way they wish.

3. A smart buyer will and should make your services for one year as an independent contractor a "contingency" to the sale. Although they are 2 seperate transactions, it illustrates the challenges involved in selling a site with custom coding produced by the seller. The buyer wants to insure that the code doesn't break, bugs are fixed, and enhancements continue to appear in the code base. These are all reasonable exspectations.

4. Yep, your duties as an independent contractor need to be clearly specified. Number of hours per week, maintain and improve the code base which should be named, answer emails, publish new content, Admin the server, etc...

5. Finally, if any of this stuff makes you uncomfortable and or you have second thoughts then it's best NOT to sell the site to this buyer. You might be able to find a buyer who already has coding skills and won't need your services as an independent contractor. In this case, you still must declare that the code base is your original creation and which way you wish to treat the "rights" to the code.

HTH and good luck!

Last edited by Steve_S; 07-20-2005 at 12:48 PM.
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