Considerations When You Purchase a Business
If you are interested in buying a business, whether you live in Florida or the business is in the state, you need to contact an experienced and skilled West Palm Beach business attorney as soon as possible. Right now you might simply be on the lookout or you may have an informal agreement with a business owner. In either case, you need independent legal counsel to guide you through this process and to be sure you obtain what you need to be successful at a fair price.
Considerations When You Purchase a Business
Buying a business is complicated no matter its size or what products or services it offers. Whether this is your first time purchasing a business or your tenth, you need a lawyer who will look over every detail of the transaction and protect your rights and investment.
Here are some important questions to ask:
-
Are you buying stock or the assets? If you buy stock, you are buying the business. However, that doesn’t mean you purchase everything the business owns such as the equipment and inventory. In rare situations, that may be OK. But in most circumstances, the assets are what make the business run and you need to buy them. Depending on the type of business, you may want to buy all the assets and form your own, new legal entity.
-
Do you get (or want) to keep the name? You may wish to purchase a business’s assets and then form your own entity with its own name. However, if you are buying a business with a strong reputation in the community, ensuring you can continue to use the name may be important to your future success.
-
Do you obtain the intellectual property? Many businesses have intellectual property that they have exclusive rights to, such as copyright materials, trademarks, and patents. You need to be able to use these if you want to move forward with the business. For instance, there’s no point in buying a restaurant if you aren’t allowed to use the secret recipes that loyal customers love so much.
-
Does the business owe taxes, payroll, or other creditors? Most businesses owe various individuals or companies money. You need a full accounting of all of the business’s liabilities and you must negotiate how these liabilities will be taken care of. You may need to require the seller to pay off some of the liabilities while you may assume others.
-
Are you buying the accounts receivable? Many businesses will be waiting on money from customers. Are you acquiring these accounts receivable or not? If no, then the money the customers owe does not go to you. However, if you obtain them, you have to purchase them, though typically at a discounted price.
-
Do you assume any commercial leases? Some businesses own their own real estate while others have commercial leases. If you want to remain in the same location, you need to figure out if you can assume the seller’s commercial lease.
Contact a Florida Business Lawyer for Advice
When you want to buy a business, you will need a lot of help. Without a lawyer, you could be taken advantage of and put yourself at significant financial and legal risk. At the Law Offices of Larry E. Bray, P.A., our experienced West Palm Beach business attorneys are here to ensure you get what you are looking for in a business purchase agreement and that you take on as little liability for the past owner’s actions as possible.
Resource:
leg.state.fl.us/statutes/index.cfm?App_mode=Display_Statute&URL=0600-0699/0607/0607.html
