Purchase & Sale of Business
At Cyngler Kaye Levy Lawyers our experienced Commercial & Property Lawyers have been assisting our business clients for over 25 years to negotiate and document the transfer of their businesses.
Whether you are a Vendor or Purchaser, there are many things to consider when transferring a business and obtaining sound commercial advice at the outset is crucial to avoiding many of the most common pitfalls.
The Top things to consider when buying or selling a business are:-
- Contracts for Purchase or Sale of a Business
- Goodwill – assessment of Goodwill (working in conjunction with your Accountant)
- Stock – assessment of stock and how to value the stock
- Debtors – assessment of Debtors
- Premises – Contract for Sale of Property (if the purchase of the business also involves purchasing the factory, building, farm etc)
- Lease – Assignment of Lease negotiations for the premises with the Landlord’s representatives
- Equipment – Assignment of Lease of Equipment and negotiations with the suppliers
- Licences – Transfers of Licences eg. Council footpath licence for restaurants, Liquor Licence
- Franchise – Transfer of a Franchise including negotiations with both the Franchisee and the Head Franchisor
- Intellectual Property – Transfer of Trademarks and Patents, and transfer of business names and logos
- Supplier Agreements – Negotiating the continuation of agreements with suppliers
- Restraints of trade on the Vendor
- Legal Structures – Establishing or deconstructing legal entities such as Companies, Discretionary Trusts, Unit Trusts and Partnerships
- Employee contracts – Establishing liability for continuing employees’ entitlements (Annual leave, sick leave, leave loading, long service leave etc)
- Wills, Powers of Attorney & Insurance to protect business partners or family members in the event you are no long able to operate the business
Whether you have previous experience as a business owner or want to commence as a new business owner, there are many aspects to consider when buying or selling a business.
The Top mistakes made when purchasing & selling a business are:-
Trial Period – missing out on negotiating a trial period and retaining the services of the Vendor to train the Purchaser and new staff
- Retention – missing out on retaining current key employees
- Zoning – not checking that the current use of the property complies with the zoning
- Planning Permit – not checking that the property is issued with a valid planning permit.
- Saleable stock – not counting saleable stock figures correctly.
- Demolition clauses – not checking that the lease does not include a demolition or refurbishment clause giving the right to the Vendor to remove you and redevelop the building within the lease term
- Lease options – not making sure that the lease provides for options past the current lease and that notification periods to exercise options have not expired
- Future liability – not accounting for the future liability for the sale of gift vouchers and promotions to be redeemed in the future
- Finance arrangements must be in place with the plant and equipment and the necessary transfers required
- Licences, Permits, Quotas – not obtaining legal advice to determine if the licences, permits and quotas of the business are transferable.
Getting sound legal advice before entering into a contract to sell or purchase a business will ensure you are aware of all your rights and obligations and can proceed with a smooth settlement. Call our office if you would like to discuss with our experienced Property Lawyers your purchase or sale.
Please do not hesitate to contact our experienced Lawyers on +61 3 9500 1722 for advice with your purchase or sale, request a cost estimate or email an enquiry.