Buying and Selling Businesses

Business Transactions - buying and selling a business

A.Lewis Ward guides business owners through the business transactions process for buying or selling a business

Whether you are buying a business or selling one, it is important to select an attorney before business transactions begin. The risk of overlooking key issues in Texas business law can be very costly. It’s easy to not appreciate or not address matters that affect your pocketbook under Texas business law.

Because of his accounting and tax background and more than 30 years of business law experience, A. Lewis Ward is a reliable attorney to help guide business owners in the purchase or sale of a business entity.

Contact A. Lewis Ward & Associates for a free consultation at (713) 961-5555 or email today.

For the buyer

Several matters need to be investigated before purchasing a business. Because investing in and taking control of a business is such an important decision, it’s wise to be cautious before taking this leap. Primary points to consider are:

  • Insuring that sales and financial records presented by the seller are accurate
  • The contents of real and personal property leases
  • The condition of tangible assets
  • Whether sufficient utilities will be available
  • Content of employment contracts, if any
  • The retention of key employees
  • Any threatened or pending claims against the business
  • Buyer’s relief if items are misrepresented by the seller

In addition to diligent investigation, it is imperative to make sure critical items are included in the buy-sell agreement; items such as:

  • The proper division of the total purchase price among assets being bought to achieve maximum tax benefit
  • The minimizing of loss of customers by a smooth, gradual transition
  • Compliance with the Bulk Sales Act, which involves insuring that creditors of the seller will be paid
  • Whether steps should be taken to prevent future competition by the seller
  • The inclusion of an “out” in the event circumstances make it too difficult for you to achieve your goals

For the seller

As the seller of a business, you may have interests that conflict with those of a buyer, such as:

  • The proper division of the total purchase price among assets being sold
  • If an installment sale is financed by you, a way to be sure the business is not dissolved or doesn’t start to fail before you can repossess it
  • Whether there will be proper security for a note if you finance the sale
  • The advisability or enforceability of a non-compete agreement, if one is requested by the buyer
  • Whether provisions concerning liquidated damages should be included in the agreement (damages you can recover – no matter what – if the buyer breaches the contract)

Other factors that you, as the seller, may choose to explore are the buyer’s credit score and past successes/failures. It is especially helpful to know these traits of the buyer if you are financing the sale in any way.

In most situations, seeking legal advice and guidance from an attorney should be a quintessential priority, whether you’re on the buying end of a deal, or you’re the one selling. A. Lewis Ward & Associates can help you with research and investigation prior to the transaction, draft one or more buy-sell agreements, and make sure you’re in the best possible position once everything is said and done. Call (713) 961-5555 or email today.