Whether we act for a client as a vendor, or a purchaser of a business, we are able to review the agreements prior to it being signed.
Every business sale or purchase transaction is different, as each business in itself is unique. The relative positions of the purchaser and the vendor are also personal to them.
Purchaser clients need to ensure that the agreement protects them and ensures that the business they purchase is the business they were expecting to own. To achieve that outcome, vendors are required to provide a significant number of warranties because the vendor is the only party who knows the true business position.
For vendors it is important that all of the warranties given are correct otherwise the vendor may find a disgruntled purchaser coming back to the vendor for compensation.
A purchaser needs to complete due diligence before entering an agreement or before the expiry of a due diligence clause included in the agreement.
Once an agreement is signed and unconditional, the transfer of any leases and the providing of securities to banks for any borrowings also need to be completed in time to enable settlement to occur on the agreed date.