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KILLARNEY · E-2 FIELD GUIDE

Is the amount paid to the departing partner the only investment figure that matters?

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THE DIRECT ANSWER

The actual qualifying capital and the enterprise’s needs require assessment; there is no universal E-2 minimum or automatic buyout-price safe harbour.

Explain the complete financial arrangement

Distinguish purchase payments, actual business commitments and projected spending. Review financing and risk, and budget government charges and professional services separately from the acquisition.

Identify which costs are actually part of the investment analysis and which are unrelated preparation expenses, and review refund and cancellation terms rather than assuming every dollar spent helps eligibility. Costs actually incurred to establish and operate the business: lease and deposits, software, registration and bond, insurance, equipment, initial payroll and committed working capital. Due diligence, legal work on both sides of the border, escrow costs, state and municipal licensing for arboriculture and pesticide application, insurance, and the working capital the business needs after closing. For a lower-priced business, a higher proportion of the price should be invested, and buying the whole sixty percent stake with the applicant's own committed funds is a strong position. A purchase price can carry goodwill payable later, a holdback released after a warranty period and an earn-out contingent on results nobody has produced yet, none of which is money placed at risk today.