614.9445171
4200 Regent Street, Suite 200, Columbus, Ohio 43219
Business Purchases and Sales |
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Buying or selling a business, or even a share of a business, is a complex transaction that requires sophisticated legal counsel. Whether it's time for one of your business partners to move on or you're buying or selling the entire business, we can help you get your money's worth, negotiate all the little details, and minimize the legal risks.
Are you getting everything you think you're supposed to get with the purchase? So many business assets are "intangible." As a buyer, how do you minimize the risks you might be exposed to if the seller hasn't been entirely forthcoming about the business? As a seller, how do you make sure the buyer doesn't come back and blame you if they're not as successful as they had hoped? You've figured out the basic terms of the deal, but now the other side has presented an extensive purchase agreement with so many "little details" you had never even considered. How do you negotiate these details? Which ones really matter? You've worked hard to build your business. Are you really getting what the business is worth? Or, you're buying a business. Is it really worth the price the seller is asking? With so many people potentially involved (employees, vendors, attorneys, accountants, etc.), how you do ensure a smooth transition? What steps are involved in buying or selling an existing business?
Once you have found a business that you are interested in purchasing (or a buyer interested in purchasing your existing business), there are still a number of steps that have to happen before the deal closes. Even when prospective clients think they’ve worked out all of the key terms of the deal, there are usually numerous fine details to negotiate before everything is truly done. 1. Agree on a purchase price. While the parties can spend the money on a formal business valuation, the expense may be overkill in some business situations. A formal valuation will cost at least a few thousand dollars. In some situations, that may be money well spent, but often, specific factors are driving the sale of the business, i.e., the seller’s desire to retire or the buyer’s desire to expand an existing business through acquisitions. Factors like these will have a much greater effect on negotiating a purchase price than any formal valuation report. At the end of the day, the only number that matters is what the buyer is willing to pay and what the seller is willing to accept. Read more: Five Things to Consider Long Before Selling Your Business 2. Optional: Submit a Letter of Intent. 3. Complete due diligence. Due diligence typically refers to the buyer's investigation of the business or assets that are being purchased. This often includes a review of the seller’s financial statements and key contracts, checking for liens on the assets or other litigation that might impact the business’s prospects, making sure the business has the required permits or licenses to operate, confirming that intellectual property is registered to the business and the related rights will be enforceable, reviewing employment-related information for key employees and contractors, and obtaining any other information the buyer needs to feel confident in moving forward with the deal. 4. Negotiate and draft the Business Purchase Agreement. 5. If necessary, working with the buyer’s bank to finalize bank financing. Alternatively, if the seller is financing the deal, then the seller will likely insist on various ancillary documents to secure any amounts owed to the seller. 6. Prepare related ancillary agreements. Depending on the terms of the deal, how it’s being structured, and whether new business entities are being created, the final deal will likely involve more documents than just the purchase agreement. Common ancillary agreements include:
7. Finally, close the deal. Agreements are signed, the purchase price (or at least an initial payment exchanges hands), and assets/stocks/membership interests are exchanged. |
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Complete Purchase or Sale or Merger Representation includes:
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Flat Fee:
Exclusions:
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Alternative Retainer Option: $4,000
Business purchase/sale and merger transactions can be difficult to predict because of the complexity of these deals. Some transactions involve multiple third parties, i.e. banks, vendors, or customers, whose approval may be required before the transaction can close. And because every deal is different, different ancillary documents are required--what documents should be prepared in one transaction may be completely unnecessary in another. Because of this, hourly billing is sometimes a more cost-effective option for business purchase / sale / merger representation. Depending on the complexity of the deal, you should budget at least $4 - 11k.
Business purchase/sale and merger transactions can be difficult to predict because of the complexity of these deals. Some transactions involve multiple third parties, i.e. banks, vendors, or customers, whose approval may be required before the transaction can close. And because every deal is different, different ancillary documents are required--what documents should be prepared in one transaction may be completely unnecessary in another. Because of this, hourly billing is sometimes a more cost-effective option for business purchase / sale / merger representation. Depending on the complexity of the deal, you should budget at least $4 - 11k.
Additional Resources:
All fees and services described on this site are for information purposes only and are subject to change at any time. Until we have both a signed Engagement Agreement and your initial payment, the Firm reserves the right to quote you a new or different fee for services based on the unique legal needs of your business.