Buying A Business - What Occurs During the Closing

Buying a Business—Closing

by Douglas Griess on September 11, 2012 at 8:00 am

Posted In: Griess Law Legal Blog Articles

After the negotiations, the due diligence, the contract, and all the work to get the transfer of a business or its assets put together comes the closing.  This is when the “keys” to the business are actually given from the seller to the buyer.  Often, obligations and requirements of the parties will be executed in new document(s) that are contemplated in the purchase agreement and which survives the closing.  These might include a new employment or consulting agreement with the seller, assignments of assets, liabilities, or intellectual property, a bill of sale, or a promissory note.  Still, some parts of the contract may also continue beyond the closing such as noncompete restrictions, certain warranties or representations, indemnity provisions, alternative dispute resolution provisions, or confidentiality requirements. 

Generally, at closing, the parties will actually execute any promissory notes, employment or consulting agreements, bills of sale, security agreements, assignments, stock certificates, and the like.  The parties will also actually exchange any payments and the property at issue.  Sometimes, when the price is based on audits or analysis that takes place between the contract and the closing, the parties will conduct a final verification and certification of that information at the closing.  The parties may also verify or inspect the property and the current financial documents.  Finally, the seller may be required to certify that the warranties and representations made in the contract remain accurate.

After the closing, the buyer is usually in possession of the business.

For a complimentary consultation:
Contact  Cecil Williams (cecil@bizbrokerflorida.com) or call  at 888-925-5055 ext.206.  Visit my personal website to search for business for sale in Florida www.bizbrokerflorida.com  Also, visit our Florida Business Exchange website at www.fbxbrokers.com