Buying And Selling A Business
Clever thinking with money and business
Transparent, Upfront Pricing On Your Legal Work
Digital-Forward Practice Means Fast Work Turnaround
At Linn Legal, we understand how to buy and sell businesses. We can also tell you what to avoid
How to sell a business badly.
- Dodge your landlord’s phone calls when they’re reminding you that rent is late on a lease you’re stuck on for three more years.
- Don’t talk to any advisors, lawyers, accountants or brokers for three years before you decide to sell your business.
- Tell your customers and employees that you’re going to sell the company, which kindly gives them plenty of time to stop working with you.
- While your best employees are leaving, have the remaining ones try to collect on all of your delinquent bills and then take that cash out of the business.
- Don’t bother with your taxes now, especially since you haven’t bothered with it in the last decade.
- Find a business broker who won’t hang up on you when you tell them that you want ten times revenue, in cash, for your business.
- Desperately sell off your inventory, trucks, office furniture and anything else you can liquidate when you can’t find a buyer.
Do you want to sell your business for a great price, to a great buyer, who will take care of your customers and employees?
The longer you have to plan the sale, the better deal you will receive. We work with business owners who are transitioning out of active management and want to sell the asset they’ve worked hard to build.
We help you sell a beautiful business. A beautiful business has excellent records, growth that inspires envy, and a bright future for its new owner. Linn Legal makes sure your company has the legal paperwork to back up its arrangements with vendors and customers so that you can demand top dollar for your sale.
We also help people avoid buying ugly businesses. Ugly businesses do deals all in cash and don’t pay taxes or worker’s comp. They don’t have long-term supply agreements with the vendors who sell them essential manufacturing supplies. They have motor oil leaking into their auto shop’s basement, waiting for the EPA to come knocking. They can’t prove who owns the business and the building. Ugly businesses have owners that are halfway retired from the business, content to let profits fall every year and get rid of good people who want to personally grow.
Your commercial transaction lawyer will help you buy and sell the beauties and leave the ugly businesses for someone else to spend their efforts on.
Once you’ve got a beautiful business, the next decision is how to fund the deal. Many owners want to sell to key employees or managers, but those people do not have the money on hand for a cash deal. A business lawyer can connect you with commercial lenders and SBA bankers to fund a buyout. They can make sure that the business has all of the written documents that a lender wants to see. A lawyer can also write a private sale agreement where the buyer pays back the seller over time.
Your lawyer can also help you decide whether to do an equity sale or an asset sale. An equity sale means that the buyer is getting legal ownership of the company’s entire stock or membership interest. The buyer gets all of the assets, including the name of the business, but they also get all of the liabilities–debt, lingering lawsuits, bad reviews online. Think of it like buying a house and everything in it. The house may have a great address in a desirable neighborhood, so it makes sense to buy it even though the furnace is old and you’ll have to patch the foundation. Equity purchases make good sense when the business has a lot tied up in its name, its business contracts and professional reputation.
On the other hand, an asset sale is like buying all the furniture in a house. The buyer gets all of the assets that make money, but they leave the liabilities behind. An asset purchase is often a better deal for the buyer because it is less risky–less things can break. Some companies have most of their value tied up in their machinery or fleets or their existing inventory.
Your business lawyer can help you get the very best deal on a purchase or sale of a business. At Linn Legal, we have helped people buy and sell restaurants, bars, factories, fields, apartment complexes, heavy equipment and much, much more. Give us a call when you’re ready to get a great deal.
