Entrepreneurs wanting to purchase or sell a business in North Carolina should know that many factors can affect whether a deal is successful. It is important to know when it is wise to pursue the completion of a deal and when to walk away from one.
Once there is an agreement regarding the sale of business, a number of actions should take place. The purchaser will have to draft and sign a letter of intent that details the sale terms, including the agreed-upon price. Both parties will have to do their due diligence, which is a critical step as information can be found that may indicate the deal may not be the right choice.
Financing will be required, typically through a bank or from the seller, if the deal is not being done completely in cash. If there have been no issues with either party’s background or the financing, a purchase agreement should be drafted and completed. It should contain the sale price, financing terms and any other supplementary agreements, such as those related to confidentiality or competition. The closing of the deal, during which all parties sign the purchase agreement and other necessary documents, is the last part of the process. Indications that a deal may not be the best idea include inconsistencies in business, legal and financial records. A business that may require significant renovation due to neglect may also not be an ideal business investment.
People might require legal assistance with buying and selling businesses. An attorney who practices business law can draft purchase agreements, review contract terms and in some cases assist with the valuation of business assets.