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How to Establish a Smooth Transition

In some instances, especially when a buyer is newly established or smaller than the seller, the buyer may not have the experience or infrastructure in place to immediately handle all aspects of the business they are purchasing.  This can especially be the case when the buyer is purchasing a part of an already established larger company with sophisticated IT or other such systems in place.  Transition service agreements provide a mechanism for a seller to offer these services to the buyer for a limited time after closing.

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Is It Possible to Bypass The Bank?

There are alternatives to using a bank to finance the purchase of a business. With seller financing, a buyer can finance the purchase of a business by bypassing the bank. In the first part of this series on seller financing, we will discuss what it is and how it works. In the next installment, we will discuss the pros and cons of seller financing for both the buyer and seller.

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Make Sure Your Deal Goes Through

When entering into an M&A deal, both sides want to be assured that the other will follow through with the transaction after the parties have agreed to the principal deal terms and due diligence confirms the assumptions underlying the major deal terms.  Due to this, some deals include termination fees or reverse termination fees in the letter of intent or purchase agreement. 

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How to Get the Best Deal in Your Business Sale – Part IV

This is the final installment of a four-part series on asset sales v. stock sales. In this installment, we are looking at a real-world example of one company absorbing another’s liability in a stock sale. That would be the recent stock purchase of Monsanto by Bayer and Bayer’s current liability risk.

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How to Get the Best Deal in a Business Sale - Part I

This is the first of a four-part series on the differences between an asset sale and a stock sale in the context of a sale of a business.  This first part will be discussing asset sales.  The second will discuss stock sales.  The third addresses the tax consequences of each. The last post in this series will analyze a recent deal that demonstrates certain differences between asset and stock sales.

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The Best Way To Protect Your Business’s Secrets

Non-disclosure agreements have many different uses.  They are quite common, for example, in lawsuit settlements or employment contracts.  They are also used in contracts to sell a business.  In the sale of a business, a non-disclosure agreement is most often used to protect the seller’s business secrets from being disclosed to third parties by the potential purchaser.

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Get The Best Deal From The Start

In the purchase, sale, or merger of a business, a letter of intent essentially means that the parties have agreed on basic terms and have decided to take the next steps of due diligence and negotiation of the final contract.  A letter of intent helps set a baseline structure for the final contract and can make later talks about the final contract go smoothly.  Most provisions in a letter of intent should be non-binding with only a few binding provisions.  Each year there are court cases where the parties to a letter of intent are fighting about whether the letter of intent was binding or not. The combination of binding and non-binding provisions in one document can lead to pitfalls without proper guidance.

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