When purchasing a company, there are several options that you can take. You may opt to deal directly with the seller and complete the transaction that way. However, in many cases, business purchases are overseen by brokers.
Brokers can be convenient as they deal with business sales every day. This means that they use Asset Purchase Agreement templates and modify them to fit circumstances. On one hand, this can mean that deals can be completed quite quickly. However, getting a deal pushed through quickly is not always best for you.
When buying a business, you need to make sure that you are adequately protected legally. Here are a few things to keep in mind about broker-generated Asset Purchase Agreements.
Are they legally sound?
Some brokers are very familiar with the law in Florida, but this is often not the case. Brokers typically do not act simultaneously as lawyers and brokers. What this means is that the contractual agreements they produce may not be up to date, and more importantly, they may not be legal. The safest way to ensure that an Asset Purchase Agreement is legally sound is to have your own legal counsel, aside from a broker.
Does the agreement protect you?
A broker’s priority is to push the deal through. Then, they can retain a profit and move on to their next client. Protecting your rights is not a broker’s highest priority. While they may use “closing attorneys”, these attorneys are not acting on your behalf, but on behalf of the broker. Yet, you may still end up paying substantial attorney fees.
Ensure that your rights are protected during a business transaction. We guide business owners with purchases, sales and mergers. Contact us for a consultation.