Selling My Business — When Is A Good Time?
Do you live in the Lakeland, Florida area? Do you own a business and are considering selling it, but not sure how to go about it? If this is you, and need the advice of a business law attorney Lakeland Florida, contact the Espinoza Law Offices.
The Espinoza Law Offices have been providing legal advice for business law contracts Lakeland area for over ten years and ready to give you the help you need to be happy with the outcome of your sale.
Steps to Selling a Business
First of all, let’s discuss some basics.
Typically, the sale or purchase of an incorporated small business will be in the form of either:
- An asset purchase — the buyer purchases all or some of the seller’s assets. This method is preferred with buyers because you get the assets, such as equipment and inventory, without taking on the responsibility of the seller’s debts and liabilities.
- A stock purchase — the buyer purchases most or all the seller’s stock. Sellers like this method because the buyer assumes the responsibility for the seller’s liabilities and debts.
These are the usual steps regardless of how the deal is structured:
- The preliminary negotiations
- The draft of the formal agreement and pre-closing review
- Closing of the deal
It is recommended you consult a lawyer as soon as possible to ensure you get the result you want. As potential liability issues and minimizing taxes are significant concerns for buyers and sellers trying to determine how to structure a deal, the help of a financial adviser is recommended as well.
Preliminary Negotiations & Discussions
The buyer investigates the seller to determine the value of the business or assets. This involves an extensive review of the seller’s assets and finances, so the buyer can determine value. How much work is required at this point depends on whether it is a stock or asset sale. More work is needed for a stock purchase because, in addition to assets, the buyer is also taking on the seller’s liabilities and debts.
Formal Agreement & Pre-Closing
The formal and final agreement indicates the completion of the negotiations. It will contain all the details of the deal.
- Terms of the deal
- When the assets and business will be turned over
- Whether or not they will be held by an escrow agent
- Other important items
- Typically, the agreement process goes through many drafts before being finalized for the pre-closing, then signed at the closing.
At the pre-closing, both the seller and the buyer will want to ensure that all the proper documentation required is in place to finalize the deal at the closing. The type of required documentation will depend on if it’s an asset or stock sale.
Closing is when the deal is finalized.
- All documents are signed, then notarized if required
- The sales proceeds are disbursed according to the terms of the agreement
- To record documents such as certificates of title to motor vehicles and other equipment or property
When You Should Sell
Only you can answer this question. Selling your business will allow you to:
- Lock in your profits
- Cut your losses
- Free up your time
- Allow you to invest in other projects
- Get a lot of money in a short time
Keeping your business will allow you to:
- Continue with regular profit
- Force you to manage your employees and invest your time
- Run the risk of industry change, and you don’t notice
- Lose income resulting in a lower sale price
Deciding to sell or not each have their own benefits. You need to make the determination yourself after reviewing the pros and cons of each. Or you can seek the advice of Espinoza Law Offices, Polk County business lawyers. They can offer legal advice for business contracts to help you make the correct decision.
How A Lawyer Can Help
An experienced business lawyer Lakeland, can guide you through the selling process, ensuring you have obtained the necessary documentation required for the sale of your business. In addition, a lawyer Lakeland Florida, such as an attorney from the Espinoza Law Offices, can represent your interests in court if needed.
If you currently have a business you are thinking of selling but need help and guidance, contact the Espinoza Law Offices in Lakeland, Florida. You will be glad you did.