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Purchasing and Selling a Business
Whether you are selling a corporation or selling the assets of your business, our firm can help you at every step. From drafting the “letter of intent” and “Share Purchase” or “Asset Purchase” Agreement to completing the closing and all steps in between, we have helped many businesses sell and purchase their businesses.
We have helped the following types of businesses sell or purchase their businesses:
Automotive sales and repairs
Railway Construction
Construction and Window Installation
Kitchen Fabricator and Installation
Summer Campground
Various Restaurants
Doctor’s Offices
Product Distribution Companies
Many more
We would be happy to give you advice on how to sell your business.
Want Us to Give You a Quote?
You have a right to pick the lawyer that best fits your needs. If you want us to give you a free quote, please feel free to call us at (705) 476-6600 or email us at info@sangsterlaw.ca.
What To Look for When Purchasing or Selling a Business
Confidentiality
One important consideration when selling your business is ensuring that your potential buyer is not trying to steal your customer lists, suppliers lists or trade secrets. Our firm has encountered these issues before, and we can help make sure that your business is protected.
Tax Issues
There are different tax consequences for purchasing a business as a “share sale” or an “asset purchase”. It is recommended you get legal advice and accountant advice before agreeing to a certain type of sale or purchase.
Letter of Intent
Company purchases, whether by share sale or asset purchase can be very complicated. There are many factors that need to be investigated before a full “Agreement” can be signed by both parties.
With that being said, most purchasers and sellers have the outline of an agreement made pretty early in the process. This outline of an agreement is often written down into a “Letter of Intent”. The purpose of this Letter of Intent is to outline the general terms of the agreement with a caveat that this will be subject to the purchaser getting to review the internal documents and financial statements of the company.
There will be a few binding clauses in the letter of intent, such as confidentiality clauses and potential deadlines for certain disclosures. It may also have a “non-solicitation” clause preventing a buyer from stealing customers or even employees from the seller.
Financial Disclosure
Every business sale is based on an expectation of revenues, profits and expenses. It is expected that the purchaser will have an opportunity to review the financial documents of the business. As a purchaser, It is recommend that you get an accountant who can go through those documents on your behalf to ensure that the expected revenues and profits are what you expect.
Employee Issues
Many business sales will have a section related to the company’s employees. They may either force the termination of employees, force the employer to pay out severances, have clauses related to employee union agreements or any variety of employee issues.
Many More Issues
There are many more issues to address, but the above are intended to be a summary to help you get started.
