What is a Business Acquisition Agreement?

A business acquisition agreement – also frequently referred to as a business purchase agreement, offer of business agreement, or a business transfer agreement – is a contract between the buyer and seller of a commercial entity. It is the contract that will govern the sale and transfer of the ownership rights of a business.

Whether you are preparing to buy or sell a business in Illinois, it is imperative you have a well-structured business acquisition agreement in place. Here, our Chicago commercial law attorneys highlight some of the most important things you need to know about business acquisition agreements.

The Agreement Controls the Terms

The business acquisition agreement will control the terms of the sale of a company. This is the most important thing you need to know: Business acquisition agreements should be customized to meet your specific needs. It is the most important document for companies involved in the buying or selling of a commercial entity. Among other things, a business purchase agreement will set forth several different contract terms, including:

  • The sale price;
  • The precise ownership stake of each party;
  • Restrictive covenants, including non-competes or non-solicitations;
  • Confidentiality or non-disclosure clauses; and
  • The ongoing obligations of each party, or lack thereof.

Negotiating an Effective Acquisition Agreement

If you or your company is considering buying or selling a business, it is essential you seek guidance from an experienced Chicago commercial law attorney. Business acquisition agreements should be carefully negotiated by a skilled professional. Your legal representative will ensure the agreement effectively protects your rights and interests.

Notably, under Illinois contract law, parties to a business purchase agreement have a duty to make fair, honest and accurate representations and to disclose relevant information from the other parties involved in the deal. As explained by the Cornell Legal Information Institute, individuals and companies can be held legally liable for a fraudulent misrepresentation.

How to Close the Deal

Once an agreement has been negotiated, drafted and reviewed, your Chicago, IL business lawyer will help close the deal and execute the contract. At closing, the purchasing entity will pay the business seller the agreed upon price. From there, the company selling the business will offer an official bill of sale to the purchaser. In addition, title to the business will also be transferred to the party that bought the business. A Chicago commercial law attorney who has experience handling business purchase agreements will be able to help you close the deal in an efficient manner.

Get Guidance from Our Chicago, IL Business Law Attorneys Right Away

At North Suburban Legal Services LLC, our Chicago commercial law attorneys represent clients across a wide range of business law matters. If you need assistance with a business acquisition agreement, we are ready to help. Set up a free, completely confidential consultation. Contact our legal team by calling (312) 909-6089. We are proud to represent businesses in Chicago and throughout Northern Illinois.

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