For many aspiring business owners, buying an already existing business may seem less complex or risky than starting your own. There are, however, a number of legal issues to consider in doing so, which is why it’s important to consider the intricacies of each legal step as well as the potential liabilities.
Questions about the previous owner’s tax compliance, business insurance, and terms of their lease – among many others – are bound to arise. A knowledgeable business lawyer in Maryland is a fundamental resource through every step.
When beginning the process, always start by doing plenty of research for each prospective business. Look out for strengths, weaknesses, and the exact specs of what you will be buying.
As part of your research, obtain statements from the company about finances, as well as lists of suppliers and large-scale customers. Also obtain a list of current employees, including details like each employee’s salary, how many years he or she has been in service, and performance reports. Pursue lists of assets and equipment as well as those of debts and liabilities, and look at any relevant contracts required for the business to operate within county and city regulations.
Deciding on Purchase Structure
“Purchase structure” refers to the most rudimentary aspects of the transaction: who is buying, who is selling, which shares or assets will be sold or bought, the price of the business, date of transaction, and how the payment will be completed.
There are a number of other terms, such as employees. If you are not planning to keep the employees on staff, there may be employment contracts you need to consider. In addition, the buyer of the business is usually responsible for preparing the long and often complex series of legal documents to be submitted to the seller’s lawyer.
How a Maryland Business Lawyer Can Help
If you are considering buying a business, an accomplished business lawyer in Maryland can help throughout every stage of the process. As you begin doing your research, for example, the seller of a business may require you to sign a nondisclosure agreement so you do not use the information for any other purposes than buying the business. An attorney like Dilip Paliath can help you make informed decisions, ensuring you do not make any unwise legal commitments before your search is underway.
A lawyer can also help you negotiate payment structure. If, for example, you are not paying the full cost in one lump sum but rather in installments, an attorney will help both parties find a deal they are satisfied with. Installments are much more common; usually, the buyer will provide a down payment of 20 to 25 percent, and then will sign a promissory note which outlines the agreement of paying the balance to the seller.
A business attorney like Dilip Paliath will help both decide on a timeline, allowing you to properly schedule payments. He will also prepare all necessary legal documents, ensuring the process goes as smoothly and satisfyingly as possible.
If you need help buying a Baltimore business, contact Dilip Paliath, experienced business lawyer in Maryland, today.