BUSINESS AND ASSET PURCHASES
We understand that every transaction, whether small or large, is important to our clients, so we work hard to provide professional, integrated and competent legal advice.
Business and Asset Purchases generally fall into three categories:
(1) asset purchases,
(2) mergers, and
(3) stock purchases.
These types of transactions are governed by state and federal laws (the FTC and SEC both regulate the various types of mergers and acquisitions).Asset Purchase:
The assets in an asset purchase can be tangible (equipment, furniture, property) or intangible property (trademarks, goodwill). The transaction can generally be set up in any way the participating parties would like, including: the assumption of some, all, or none of the seller’s debts and liabilities; the continued engagement of employees; and the fulfilling of certain contracts.
In this transaction, two companies combine to form a single legal entity. The surviving entity will assume all of the liabilities and obtain all the assets of the company that disappears in the merger. The applicable state must issue a “merger certificate” to complete the merger.
This transaction is put into operation by one individual or entity purchasing all of a portion of the stock of an existing stockholder. In purchasing the stock, the new owner accepts all the liabilities and assets that are attached to the stock or ownership unit.