In our earlier articles we have focussed on some of the steps preliminary to selling your business. In this article, we focus on why you should use a lawyer and when you should use a lawyer as part of the sale process.
Why Use a Lawyer as part of the Sale of Business Process?
Of course, an article written by a lawyer is always going to suggest you should use them!! However, there is a reason people engage lawyers to assist in all types of commercial transaction. Put simply, lawyers use their knowledge and skills to balance risk and get deals done.
Our role as the Seller’s lawyer is to anticipate and therefore avoid disputes or problems in a transaction. From providing counsel to the Seller about the sale process, to drafting the contract, negotiating changes to the contract, locking in the deal, dealing with third parties required to complete the deal (for example, Landlords) and navigating the sale process to completion is what a good lawyer should always do for their client.
When Should You Use a Lawyer as part of the Sale of Business Process?
Earlier rather than later is the simple answer. In our prior articles concerning due diligence we focused on key areas that a Seller must have in order before selling their business. If there are loose ends, such as ensuring protections around Intellectual Property, we as the lawyer can not only identify the issue but help take steps to remedy the issue before it becomes a problem.
The next key juncture where a lawyer is helpful is during the negotiating process. Keeping your sale information confidential, providing guidance on deal terms and assisting in settling the terms of the deal are all elements for which lawyers provide guidance.
At the latest, and often the first point of engagement by a Seller with their lawyer, is when a sale has been agreed. At this point, our role is to prepare the contract to reflect the terms of the deal. Given most deal terms only deal with the high-end issues, there are a multitude of considerations that go into drafting the contract. These matters are not often considered when the deal is first made by the Seller and Buyer. Our role as always is to try and find the balance of protecting the Seller’s interest whilst at the same time ensuring the contract is sufficient to ensure that the Buyer will proceed to an exchange of contracts and ultimately completion.
Before You start the process to sell, a Seller should look to engage their key ‘transaction engineers’, that is their lawyer, accountant and business sale agent. As your lawyer, we can help navigate to tricky waters of selling your business and ensuring that your deal gets done in the way you want and when you want.
If you would like to discuss a Business Sale & Purchase or require more information please contact: Heath Adams (Director-Lawyer), Amelia Hatton (Associate) or Shalvin Kumar (Solicitor).
Written by Heath Adams.