QUICK TIPS FOR BUSINESS SALE AND PURCHASE
West Perth Legal has helped many business owners successfully buy or sell a business in WA. This ranges from medical practices, restaurants, trades businesses and professional services firms. We work closely with our clients on all legal aspects of a business sale or purchase from negotiation of a business sale or purchase agreement, legal due diligence, business settlement, transfer of liquor license or other related licenses.
Tips for a buyer of a business
- Before signing any documents or making any written offers, make sure you first obtain legal and taxation advice as to the correct buying entity in which your business will be held (e.g., company, unit trust, family trust, partnership, etc).
- If you are buying the business with a partner (regardless of the buying entity), we suggest putting in place a shareholder / unit holder agreement or partnership agreement.
- Consider if you have sufficient funds to purchase the business assets and pay any lease assignment costs, transfer duty, etc.
- Consider if you should or need to obtain finance to purchase the business and speak to your financier before making an offer.
- Consider if you require certain permits, licences or approvals in order to operate the business.
Tips for a seller of a business
- Make sure the financial statements of your business are up to date.
- Ensure you protect all intellectual property, business names and other goodwill of the business.
- Check any “key contracts” of your business, such as supply agreements, to confirm they are in writing and are assignable.
- Ensure you have employment agreements in place for your key staff and refrain from alerting them to the proposed sale until just before settlement and you are certain the transaction will proceed.
- Ensure any lease for the business is properly documented with a sufficient remaining lease term or assignable option periods to make the business attractive to a potential purchaser.
West Perth Legal Settlement Services
There are many facets to the purchase and sale of a business. It is important that each party to a sale or purchase of business transaction be independently advised by a lawyer and an accountant.