Selling Your Business: Documents to Show Your Lawyer
Sometimes it's necessary for a person to close his or her business. Even if the business is not doing well under your control, selling your business could be a wise and sometimes profitable alternative. Of course, you have to have a buyer first.
If you decide to sell your business, it's a good idea to consult with an attorney to make sure you are getting a good deal and following all applicable laws and procedures. This article provides a list of documents to gather before your first consultation with an attorney when selling your business.
Selling Your Business: Overview
A small business owner puts a lot of time and energy into his or her business, which can make it particularly difficult to make the decision to sell the business. If possible, it's best to sell when it's profitable, has a positive future forecast, and the economy is doing well -- however, these conditions may lead you to hold on to your business. Of course, there are times that you may need to sell your business due to personal reasons, and you can't wait for ideal market conditions. If you're thinking about selling your business, it's important to plan ahead, as the process can take a long time to complete.
Documents Related to Selling Your Business
In order for an attorney to be able to provide you with the best financial advice regarding the sale of your business, you must ensure that your attorney has copies of all the relevant business documents. The following list details the documents you should provide to your attorney when discussing the sale of your business.
- Your company's current financial statements, including its balance sheets, profit and loss statements, cash flow statements, and projections.
- A list of stockholders or shareholders, the number and percentage of shares owned, and the total amount of stock issued.
- A list of the names and titles of the persons authorized to sign documents for your company.
- Copies of your company's incorporation, partnership, or limited liability company documents.
- Copies of your company's insurance policies.
- Copies of all employment contracts.
- A list of all of the company's employees.
- Copies of any pending lawsuits against your company.
- Copies of your company's federal and state tax returns for the last three years.
- The legal description of any real property owned by your company.
- Copies of your company's real property lease(s).
- Copies of all leases for vehicles, equipment, computers, telephones, etc.
- A list of your company's bank and investment accounts.
- A schedule of your company's assets.
- A list of creditors.
- Copies of all notes, mortgages, security agreements, loan agreements, and U.C.C. financing statements.
- Copies of any outstanding state or federal tax claims, audits, or actions.
- Copies of business registrations, licenses, and permits.
- Copies of "key-person" insurance policies.
- Copies of all outstanding contracts with vendors and customers.
Please keep in mind that this list is not meant to be exhaustive, as you may have other documents that will be relevant to your particular business and/or situation. If you're not sure whether a certain document or other information is relevant to your business, you should err on the side of caution and provide the information or document to your attorney so that he or she can decide if it's relevant.
Getting Legal Help
If you have any questions or concerns about selling your business or would like to discuss other aspects of your business, you may want to contact an experienced business and commercial attorney in your area.
For more information and resources related to this topic, you can visit FindLaw's section on Business Lawyers and Resources.
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