One of the questions that is often asked from the investors is that “What Documents are needed to sell a Business' '.
In this Article we shall answer your question in two segments i,e.
A checklist for the legal documents needed to sell a business
A checklist of the financial documents needed to sell a business
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Legal Documents needed to Sell a Business
Following are the documents that are needed for selling of the business-
A Non-Disclosure Confidentiality Agreement
Offer to Purchase Agreement
Current Lease Agreement
Enterprise Insurance Policy
Business professional Certificates
Existing Vendor/Client Contract
Employment Agreements
Letter of Intent
Post Closing Agreement
Financial Documents needed to sell a Business
Financial Documents needed for selling of a business are as follows-
Personal Financial Statements (Which is to be filled by the buyers)
Sellers’ discretionary earnings
Sellers’ discretionary cash flow
Internal profit and loss statement of past two to three years
current/updated balance sheet of a company
Corporate tax returns of past two to three years
Accounts payable reports
Seller’s promissory note for financing
UCC financial statements
Escrow Agreements
These Documents are Drafted by Whom?
People often think about what documents are needed for selling a business. People also think about who can draft those documents properly.
Selling a business requires a team of experienced M&A professionals including an accountant and attorney specialized in M&A. The experienced professionals at BIAT Legal LLP would help you in drafting these documents. Our legal team will prepare the documents correctly and will draft it for your company.
What are the Role of these documents in selling a business?
Seeing of a business can be done by doing a group discussion, and by signing a contract between the parties. Once this is done the seller can handover some of the financial and legal documents mentioned on the checklist above. After both sellers agree to sell its business then it can be sold to the buyer all he needs is a level of preparedness.
Protecting yourself in a event of no buy
Many times seller does not want to sell its business because of the time of financial crisis, or economic downturn, when business is in financial distress or sometimes because of the bad timing or whatever the reason may be if buyer doesn not get seeler, then in that case Non-disclosure agreement must not be treated lightly. They will protect you even in case of no buy. That is why it is important to know what documents are needed to sell a business, even if you don’t end up with a deal on the table.
Do you need help in drafting of Documents?
Now that you know what documents are needed to sell a business, you might be feeling a little overwhelmed. Our expert BIAT Legal LLP team is ready to offer assistance as you prepare to sell your business.
Discuss buying/selling a business with our M&A consultants, Contact us today.
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