subject: Are You Selling Your Business? [print this page] Wait! Read the instructions below before going to make any final decision.
Two weeks ago, Mr. Roger, who was the owner of a small company, sold and transferred his property to Mr. Arnold. At the time of sale there were three people who owned the shares of the company but Mr. Roger ignored the fact. Mr. Arnold has a plan to open a commercial plaza. Meanwhile, Miss Daisey came at the doorsteps of Mr. Arnold and claimed that she is a shareholder and Mr. Roger illegally sold it in her absence. She informed Mr. Arnold that she paid one third of purchase price when this company was built nine years ago. She has been in Wales for the past 6 months looking after her sick brother. Now, Mr. Arnold is searching for a solicitor who helps him out in this situation as he has paid one third amount and signed the business sale property.
That is not a problem with Mr. Arnold only; in fact many people in Scotland are facing it.Before signinga contract that you can't dismiss or withdraw, it is wiseto go through pros and cons of a business sale agreement to avoid such troubles.
Is it assets or shares? Be clear!
This agreement applies when someone is selling or buying a business or a company. The terms and conditions applied on the business sale agreement are different as compared to company sale agreement. Business Sale Agreements is generally applicable, when business of a company is being sold (assets and undertakings) rather than the shares of the company. A Share Sale Agreement, on the other hand, should apply when a company shares are involved in transaction.
Interesting! Tell me more
A legally binding business sale agreement must contain following clauses:
definitions
sale and purchase
consideration
conduct of business before completion
completion
action after completion
debts and liabilities
contracts and employees
apportionments
warranties
confidentiality
notices
law and jurisdiction
a general clause addressing further assurance, variation, the scope of the agreement, representation, severability, assignment and third party rights.
Interesting facts, want to know more
Another interesting fact is that you can use above clauses either for sale of a small company whose shares are disseminated among many people as similar to Mr. Roger case or for sale of stocks and other assets by a limited company. This agreement is also applicable on sale of small property like food bar, shop or small cabin etc.
It is important for you to read carefully about each clause of your agreement. Seek advice from a solicitor, if you feel necessary.
Don't have the time to go to a solicitor then check our Scot Lawman's comprehensive business sale agreement. The documents are written in simple plain English and provide complete guidance notes. The company also offers a diverse range of specialized legal services for its clients across the globe.
