Purchasing a business involves various legal complexities that must be navigated carefully to ensure a smooth transition and mitigate potential risks. Some of the main considerations are outlined below:
1. Due Diligence:
This process involves investigating the financial, operational, and legal aspects of the business to assess identifying potential risks. Purchasers should review financial statements, contracts, leases, intellectual property rights, and any existing legal disputes or liabilities. Engaging legal and financial professionals can assist to streamline this process and ensure all relevant information is properly assessed.
2. Purchase Agreement:
This document outlines the terms and conditions of the sale, including the purchase price, assets included, warranties, and indemnities. The purchase agreement should be reviewed thoroughly by a solicitor to ensure that all critical aspects of a typical purchase agreement have been incorporated and that it aligns with your expectations and negotiations with the Vendor.
3. Assets, Contracts and Leases:
Transferring assets and contracts from the Vendor to the Purchaser is a critical aspect of the acquisition process. Depending on the nature of the business, this may involve transferring ownership of real property, leases, intellectual property, equipment, inventory, and customer contracts.
4. Employees:
Typically, purchasing an existing business will involve taking on some or all the existing employees. Purchasers must comply the legislation regarding the transfer of employees, including any obligations under existing employment contracts, employee entitlements or awards.
5. Regulatory Matters:
Businesses in NSW are subject to various regulatory requirements depending on their industry. Purchasers must ensure compliance with all relevant laws and regulations, including licensing, obtaining requisite approvals from regulatory bodies, permits and taxation.
Please contact us to guide you through the process of purchasing an existing business on (02) 9525 8688
