Posted on 03/27/2017 4:13:53 PM PDT by WhoisAlanGreenspan?
Selling my business and the building it has always occupied for many years. This is a retail store. Modestly successful, which is why I'm leaving. I need a little less modesty.
The party who wants to buy it has many years of experience in this particular type of retail business and there's little reason to doubt sincerity or ability to pay what is being asked.
There's a bunch of websites where you can buy a "Purchase Business Agreement" that matches or exceeds the detail level of older agreements I have access to for comparison. Pretty simple stuff when you have all the fancy "therefore and henceforth" language already printed out for you.
There's three different attorneys who were involved in prior contract formalities with this same store and all three were scorned and cursed at by the end of those relationships.
So I'm throwing out here for discussion. Do you really need a lawyer in this type of situation?
Yes, or you’ll regret it. You’re not selling a 1998 Ford Taurus, you’re selling a business.
get a GOOD lawyer
someone with experience.
You cannot un-ring the bell.
it’s (relatively) cheap insurance. Fighting a lawsuit over misrepresentation , failure to disclose and a myriad of other nuisances can add up.
I sold over the years a number of large oil and gas companies and oil and gas service companies.
There are all sorts of things for a good lawyer to keep your ass out of a crack on, notably allocation of the purchase price to minimize tax.
And go-forward liability. Releases. Permits. Making sure you get paid. Etc.
I think that, as long as the both of you have signed a change of ownership, that recognizes your ending the ownership and his getting the ownership and that all monies that has been sent has been received, you probably don’t need a lawyer between the two of you. A court will usually recognize a written agreement that was signed freely by both parties.
You can only know for sure if you needed a lawyer after it is too late. It generally costs less to stay out of trouble than it does to get back out of trouble.
On the other hand, the lawyers can argue over commas until no one has anything left but them. I represented a guy selling a business one time. It went smoothly because he wanted to be fair, and the other guy didn’t have a lawyer. And since it was just drawing up the papers, I didn’t hurt my client, either.
Do you know whether it is better for you to sell the business or the assets of the business? Who will have the liability if some issue crops up after the sale? Etc.
As a CPA who works with many attorneys in business dealings and court cases.... it is best to have an attorney...
Good attorneys are hard to find.
I am right now in a heavily contested business sale for several million $$$ and the attorneys suck. I actually guided my client to hire another attorney for tomorrow’s meeting who is a specialist in the specific area of law.
$400 per hour is his rate... but he is definitely worth it.
Often a cheap attorney costs you far more in the long run as you are paying his time to learn the law.
You might just let the buyer’s attorney draw up the documents and then take them to your attorney for review. That will save you quite a bit.
Get a real estate lawyer. You’re not suing anybody, nor do you want to.
I have bought and sold a lot of real estate and businesses. An attorney is necessary to keep you from leaving out things that will come back to haunt you and maybe haunt you in a big way. A necessary evil maybe in your mind but still very important. I’m a CPA, not an attorney but even that experience doesn’t cover. That said, always read and understand the contract and ask questions if you don’t. It’s your butt on the line no matter who writes the thing up so trust your instincts if something strikes you wrong.
I would NEVER sell a business without a GREAT attorney, NEVER!!!
I’ll sell you Google if you promise not to involve a lawyer. It’ll just drive the price up.
Is the buyer paying you cash or a promissory note? If a note or an installment note will they be pledging the business back to you as collateral for payment of the note?
Are they buying your corporate entity (LLC or whatever) or are they buying assets and assuming liabilities from the underlying business as of some particular closing balance sheet date?
Are you personally fully up to speed on the tax consequences to you of the sale?
You don’t need to run up a bunch of lawyers’ fees, but talking with a local small business lawyer for a couple of hours to identify issues you yourself might overlook would seem sensible. And if the buyer is proposing the form of agreement, you could ask your lawyer to look it over for major points, without asking him or her to negotiate it on your behalf. There may be things the buyer wants that you will want to ask a lawyer about, such as a non-compete for example.
I knew a guy who sold his trucking company, never got his money and tried to commit suicide by driving his family off a bridge. You need a lawyer/closing agent to handle all the financial transactions.
As a CPA myself I agree.
A great lawyer will see problems and head them off before they occur.
Don't be cheap amigo.
I’ve represented buyers and sellers of businesses and never charged all that much. I’ve seen a few who’ve tried to do it themselves and then spent more on a lawyer later on. I’ll send you a FReepmail.
In my experience it is worth it. Too many business acquisitions end up with the buying party unhappy any number of reasons.
If you are a small business, the lawyers you have access to are generally not the cream of the crop. They might try and charge you a lot, but they still are not top notch.
If you go to a lawyer, they are going to download a standard form and fill in the names. The actual selling of the business is pretty simple. In almost all cases you are selling the assets of the business (not the business itself). That means you are responsible for any past liabilities.
As someone else mentioned, you probably want a lawyer for selling the real estate. This is more complicated than selling the business.
Spend you money on a GOOD tax accountant.
Yes.
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