Buying a Business? Call A Lawyer First.
The purchase of a business is one of the riskiest and most complex transactions imaginable. You are purchasing not only the hard assets like inventories and computers, but also many human, contractual and financial relationships. You are also agreeing to step into whatever predicament that business happens to be in. The process of investigating these things can and should be painstaking. At The Vasilco Law Group, P.C., our lawyers help clients with the purchase of businesses. Before our clients buy a business, we provide them with an exhaustive due diligence checklist, which gives them a clear and easy guide to asking all of the right questions to the seller. Many of these questions will uncover ugly problems which otherwise would have gone entirely unnoticed, until that is, they blew up in the face of the new owner. Call us today if you are thinking about buying a business. We would love to help.
Seller Carry, Purchase Price Holdbacks, Promissory Notes.
When buying a business, it is absolutely crucial to withhold some of the total payment in some way, in order to protect yourself against potential fraud by the seller. Once you have taken control of the company, you may find many things which the seller misrepresented. Many charges or issues may fall on your lap which the seller never told you about, but was supposed to. In order to protect clients who are purchasing businesses from this, we always try to structure deals such that a certain percentage of the purchase price is withheld for a period of time by the buyer. This can be done in the form of a promissory note made by the buyer in favor of the seller. It is a loan from the seller to the buyer, a form of seller carry. Seller carry is important not only to generate leverage for return on investment purposes, but to fund any breaches of the purchase agreement by the seller. Call us to assist you with the documentation process of your deal. Let us talk you into including some amount of seller carry.
Contact a Denver Business Lawyer at The Vasilco Law Group, P.C. for legal counsel and litigation representation.