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Business Purchase/Sale

Who Needs This Service?

  • Anyone purchasing a business (it is the purchaser's lawyer who drafts most of the documents).
  • Anyone selling a business (the seller's lawyer will ensure the representations and obligations are fair and that the seller's minute books are organized and up to date).

Learn Something About The Law

As a general rule, sellers will want to sell the shares of their company and buyers will want to purchase the assets. This is generally because of the tax advantages.

The process for a purchase/sale is commonly as follows:

  1. Sign a Letter of Intent

    This sets out the deal terms as well as what will happen over the following weeks towards closing the deal.

  2. Conduct Due Diligence

    Purchasers will want to do searches of the Vendor to make sure they own everything they say/think they do and that they do not have any outstanding debts that could affect the Purchaser in the future.

  3. Sign a Purchase Agreement

    This will set out the representations and warranties of the Vendor, among many other details that go beyond the deal terms.

  4. Closing

    The supporting documents get signed and the purchase price gets paid.

  5. Post-Closing Matters

    There are often some small follow up details that need to be completed. For example, in a purchase for shares the minute books must be updated with the names of the new shareholders and directors.

Trying to cut corners on this process can lead to the taking on of an unreasonable amount of risk. For example, in some situations creditors of the Vendor can put a lien on the assets and have a greater right to them than a subsequent Purchaser.

To Do

  1. It is advisable to involve us early in the process so we can help tailor the deal. However, occasionally people will sign their own Deal Terms/Letter of Intent.
  2. Provide us with your Deal Terms/Letter of Intent and information on all of the parties involved.
  3. Once we have all of this information, we will be able to begin conducting the due diligence and prepare all of the documentation for signing.

Contact Us

For more information about buying and selling a business, please give us a call or email.