The complete guide to selling a business

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Where to find it

Law Library — 4th Floor Collection (4th floor)

Call Number
KF1659 .S74 2017
Status
In-Library Use Only

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Names:

Summary

Everything you need to sell your business

You've worked hard to build your business--so if you're ready to sell, make sure you protect your interests and maximize profit with The Complete Guide to Selling a Business.

Packed with practical advice and invaluable insights--and dozens of key legal forms--this book shows you how to:
get your business ready to sell value your assets set the best price for your business find the right buyer anticipate and resolve tax issues negotiate a payment plan limit your liability work with lawyers, accountants, and brokers, and close the deal and transfer the business to its new owner.

This edition is completely updated with the latest tax considerations, and now provides more advice on marketing the sale of your business.

Contents

  • Your Companion for Selling Your Business p. 1
  • Is This Book for You? p. 2
  • Will You Still Need to Hire Lawyers, Accountants, or Other Professionals? p. 4
  • Part 1 Overview of the Process
  • 1 Deciding Whether-And When-To Sell p. 7
  • Deciding Whether or Nor to Sell Can Be Agonizing p. 8
  • Do You Have a Saleable Business? p. 10
  • Working Out Problems With Your Co-Owners p. 16
  • Choosing the Best Time to Sell p. 18
  • If You Need to Leave the Business, But the Time Isn't Right to Sell p. 20
  • Staying Involved With Your Business p. 21
  • Protecting Your Future Ability to Earn a Living p. 22
  • 2 The Key Steps in Selling Your Business p. 25
  • Figuring Out What Your Business Is Worth p. 26
  • Preparing Your Business for Sale p. 27
  • Creating a Plan for the Future p. 28
  • Marketing Your Business p. 28
  • Negotiating the Deal: Key Sale Issues p. 29
  • Signing a Sales Agreement p. 30
  • Closing Your Sale p. 31
  • 3 The Key legal Issues in Selling Your Business p. 33
  • Take Presale Legal Protections p. 34
  • Understand the Differences Between Selling the Business Entity or Just Its Assets p. 35
  • Be Clear on What You'll Sell and What You'll Keep p. 38
  • Understand the Transfer of Intellectual Property p. 39
  • Protect Yourself Against the Buyer Failing to Make Payments p. 40
  • Assure Your Ability to Earn a Living Later: Guidelines for Noncompete Agreements p. 42
  • Limit Your Legal Liabilities to Third Parties Once the Business Changes Hands p. 43
  • Protect Yourself Against Unintended Liability to the Buyer p. 47
  • Comply With State and Local Laws That May Affect Your Sale p. 48
  • 4 Tax Considerations When Selling Your Business p. 51
  • An Overview of Key Tax Issues p. 52
  • Understanding the Federal Tax Rate That Applies to Your Sale p. 55
  • Tax Issues When Selling the Business Entity p. 56
  • Selling the Assets of a Business p. 60
  • Asset Sale by a C Corporation p. 64
  • Asset Sale by an S Corporation p. 67
  • Asset Sale by a Sole Proprietorship or Single-Member LLC p. 68
  • Asset Sale by a Partnership or Multimember LLC p. 68
  • Allocation of the Purchase Price p. 68
  • 5 Putting a Price on Your Business p. 77
  • There's No Universal Pricing Formula: Many Factors Affect Price p. 78
  • Sales of Comparable Businesses p. 80
  • The Income Valuation Approach p. 81
  • The Asset-Based Approach p. 83
  • Industry Formulas and Rules of Thumb p. 84
  • How Appraisers and Other Experts Can Help You Set the Price p. 85
  • Putting It All Together to Price Your Business p. 87
  • 6 Working With Lawyers, Accountants, and Brokers p. 89
  • Lawyers p. 90
  • Accountants p. 94
  • Business Brokers p. 97
  • Part 2 Getting Ready to Sell
  • 7 Preparing Your Business for Sale p. 103
  • Make Your Business Attractive to Buyers p. 105
  • Get Your Paperwork in Order p. 112
  • Show How Profitable Your Business Really Is: Restate Your Profit and Loss Statement p. 119
  • Take Steps to Improve Business Profitability p. 121
  • Add Value to Your Lease p. 124
  • Communicate With Employees About the Sale p. 127
  • Clean Up Existing Problems p. 128
  • Nail Down Vital Relationships With Customers and Suppliers p. 133
  • Prepare a Checklist of Presale Tasks p. 134
  • 8 Finding the Right Buyer p. 137
  • First, Look for Buyers Close to Home p. 139
  • Strategic Buyers p. 144
  • Special Concerns When Approaching Competitors p. 149
  • Marketing Your Business by Word of Mouth p. 150
  • Marketing Your Business Through Advertising p. 151
  • How Business Brokers Can Help Find Buyers p. 156
  • How to Quickly Size Up Prospects p. 157
  • 9 Structuring the Sale p. 161
  • Asset Sale vs. Entity Sale p. 163
  • Lump Sum Payment vs. Installments p. 170
  • How to Structure an Installment Sale p. 171
  • Ten Strategies to Protect Yourself in an Installment Sale p. 173
  • Doing Future Work for the Business p. 179
  • Restrictions on What You Do Next: Noncompete Agreements p. 184
  • The Future of Key Employees p. 186
  • Keeping the Buyer Motivated p. 188
  • 10 The Investigation Stage: How Sellers and Buyers Check Each Other Out p. 191
  • The Buyer's Investigation of Your Business p. 193
  • Honesty Is the Best Policy: The Importance of Full Disclosure p. 195
  • Business Information the Buyer Will Want to See p. 198
  • Protecting Sensitive Information With a Confidentiality Agreement p. 213
  • Why and How You Should Check Out the Buyer p. 216
  • Practical Steps for Evaluating a Buyer p. 218
  • 11 Drafting a Letter of Intent p. 225
  • Why Use a Letter of Intent? p. 226
  • What to Put in Your Letter of Intent p. 227
  • Why You Should Only Sign a Nonbinding Letter of Intent p. 229
  • Format for a Letter of Intent p. 229
  • Part 3 Preparing the Sales Agreement
  • 12 Preparing the Sates Agreement and Other Legal Documents p. 237
  • Overview of Your Sales Agreement p. 238
  • Related Legal Documents p. 243
  • Well-Drafted Documents Are Crucial p. 244
  • Preparing Your Sales Agreement and Related Legal Documents p. 245
  • How to Prepare Attachments to Your Sales Agreement p. 247
  • Steps in Finalizing Your Sales Agreement and Other Documents p. 248
  • Amending Your Sales Agreement p. 249
  • 13 Who's Selling, Who's Buying-And What's Being Sold p. 251
  • Naming the Parties p. 252
  • Identifying Your Business and What You're Selling in an Asset Sale p. 256
  • Identifying the Business and What You're Selling in an Entity Sale p. 261
  • 14 The Sales Price and Terms of Payment p. 263
  • Sale Price: Asset Sale p. 264
  • Inventory: Asset Sale p. 269
  • Dealing With the Purchase of Accounts Receivable: Asset Sale p. 271
  • Sale Price: Entity Sale p. 273
  • Deposit p. 274
  • Payment at Closing p. 275
  • Promissory Note p. 277
  • Security for Future Payment: Asset Sale p. 278
  • Security for Future Payment: Entity Sale p. 280
  • 15 Dealing With Liabilities and Representations p. 283
  • Liabilities in an Asset Sale p. 285
  • Liabilities in an Entity Sale p. 288
  • Representations: What They Are and Why They Matter p. 290
  • Seller's Representations p. 291
  • Buyer's Representations p. 296
  • 16 Payments for Noncompete and Consultant Deals p. 297
  • Agreeing Not to Compete With the Business After the Sale p. 298
  • Agreeing to Work for the Business After the Sale p. 301
  • 17 Other Important Legal Language for the Sales Agreement p. 303
  • Contingency Clause p. 304
  • Closing Arrangements p. 305
  • Dispute Resolution Clause p. 307
  • Technical Contract Clauses p. 310
  • Additional Optional Clauses p. 313
  • 18 Signatures on a Sales Agreement p. 315
  • Required Signatures for Sole Proprietors on a Sales Agreement p. 316
  • Required Signatures for an Entity on a Sales Agreement p. 317
  • A Spouse's Signature on the Sales Agreement p. 319
  • Signature Clause in a Sales Agreement p. 321
  • Typical Formats for Signing a Sales Agreement p. 322
  • Accepting Personal Responsibility for Commitments in a Sales Agreement p. 325
  • Signing the Sales Agreement p. 328
  • Part 4 Preparing the Promissory Note and Other Sales Documents
  • 19 Promissory Notes and Other Installment Documents p. 333
  • The Promissory Note p. 334
  • The Security Agreement p. 344
  • The UCC Financing Statement p. 350
  • Escrow Agreement for Entity Sale p. 356
  • 20 Bill of Sale, Lease Assignment, and Other Documents for Transferring Your Business p. 365
  • Bill of Sale: Asset Sale p. 367
  • Bulk Sales Compliance p. 372
  • Assignment of Lease: Asset Sale p. 375
  • Assignment of Other Contracts: Asset Sale p. 379
  • Assignment of Intellectual Property p. 383
  • Approval of Entity's Sale of Assets p. 386
  • Transferring Your Entity p. 387
  • Assignments in an Entity Sale p. 390
  • 21 Documents for Noncompete and Future Work Commitments p. 393
  • Covenant Not to Compete p. 394
  • Contract for Employment p. 403
  • Contract for an Independent Contractor p. 403
  • Part 5 Closing the Deal
  • 22 Preparing for a Smooth Closing p. 411
  • Where and When to Hold the Closing and Who Should Attend p. 412
  • Documents for Transferring Assets p. 414
  • Documents for Transferring an Entity p. 416
  • Handling Last-Minute Problems p. 418
  • Moving On p. 418
  • Appendixes
  • A How to Use the Downloadable Forms on the Nolo Website p. 419
  • Editing RTFs p. 420
  • List of Forms Available on the Nolo Website p. 421
  • B Sample Sales Agreements p. 423
  • Sample #1 Asset Sale of a Restaurant by One Sole Proprietor to Another p. 424
  • Sample #2 Entity Sale of a Bookstore by the Two Shareholders to an Individual p. 432
  • Sample #3 Asset Sale of a Landscaping Business by a Single-Owner LLC to a Partnership p. 439
  • Index p. 449

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