Considering buying an existing business? We’ll guide you through the acquisition.

BUYING A BUSINESS

Buying a business is not a decision to be taken lightly. There are numerous stages involved in buying a business and at each stage, having a knowledgeable business law attorney on your side can be very helpful. From starting a negotiation to purchasing a business and finalizing the transaction, the business law team at Solomon Richman can help review documents at every stage.

EVALUATING THE INVESTMENT

It is important to understand when purchasing a business that a thorough investigation is necessary. An investigation of the business investment involves determining why the current owner is selling, the proper monetary value of the businesses, and what intrinsic value may be associated with the business due to goodwill. At Solomon Richman, we have the experience and knowledge to carefully review all financial documents and contracts before you agree to invest in a new business.

MITIGATING POTENTIAL LIABILITY

Regardless of the type of business you are purchasing, there is a potential for you to be sued down the road for actions taken by your predecessors. Successor liability can be very serious unless steps are taken to mitigate that liability in the purchase agreement. When you purchase a business, you are purchasing its existing assets, but you also may be purchasing future lawsuits. In order to avoid this problem, business purchase contracts may be specifically worded to absolve you of future liability for the action or inaction of the previous business owner.

PURCHASE AND SALE AGREEMENTS

When drafting purchase and sale agreements for business, a number of factors must be taken into consideration. If the facilities where the business is located are leased, the purchase and sale agreement should carry specific language that explains both the current owner’s and the successor owner’s responsibilities to the current landlord. In addition, there may be a need to clarify what, if any agreements between the purchaser and seller exist in regards to competitive business ventures. Other items such as the current employment status of existing employees, open contracts with vendors or clients, and unpaid invoices may also be covered in a purchase and sale agreement.

CLOSING AND TRANSFER OF OWNERSHIP

There are typically numerous documents that are necessary when purchasing a business including promissory notes, shareholder documents, when appropriate, and board of director approvals, if necessary. All of these documents should be carefully reviewed by your legal team prior to being signed.

At Solomon Richman, we have been helping people with business purchases all over New York for more than 50 years. We’re proud of the fact that our business law team has worked with businesses of all sizes to ensure smooth and successful transactions.

Whether you are currently in the process of seeking a business to purchase, or are currently in negotiations to purchase a business, contact us for a consultation with one of our business law attorneys. We will work with you closely to ensure that all contracts are in place, that we minimize your potential future liabilities and the transaction goes as smoothly as possible.

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3000 Marcus Ave., Ste. 1E5 Lake Success, NY 11042
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EMAIL: frichman@srlilaw.com
CALL: (516) 437-6443

SOLOMON RICHMAN P. C.

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