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What to include in a business sale contract

On Behalf of | Jan 15, 2020 | Buying & Selling Businesses |

After a business owner in North Carolina agrees to sell his or her company to another person or entity, the terms of the deal will be put into writing. The contract will need to include the name of the person who is selling the business and the name of the person buying it. It will also need to include the name of the business that is being acquired. Furthermore, it will need to specify the assets that the buyer is acquiring in the deal.

For instance, the buyer may acquire physical assets such as land and equipment. He or she may also acquire customer lists, intellectual property or other intangible assets that may help the company generate revenue. Buyers are also generally expected to inherit any debts or liabilities that the organization is responsible for paying off or otherwise taking care of.

A sale contract should specify how the deal is being structured, and this can be important because the seller may trigger a taxable event by liquidating his or her company. The deal should specify whether the buyer is making a lump sum payment or will be paying the seller over time. Finally, the contract will need to be signed before it is allowed to go into effect. The signatures should also be dated and witnessed by a notary public to avoid disputes over their validity.

Typically, there are many issues that need to be addressed before business transactions can be finalized. For instance, it may be necessary to clarify what is being sold, how much it is being sold for and whether there are any potential issues that could delay the transaction. An attorney may be able to help a seller liquidate his or her company in both a timely and favorable manner.