Navigation bar
  Home Print document Start Previous page
 52 of 71 
Next page End 47 48 49 50 51 52 53 54 55 56 57  

© Copyright 2002-2003. All rights reserved.
Page 52
How To Investigate Any Business Opportunity
·
What if material changes in the business occur before the buy-sell transaction is closed? 
·
What if the seller opens a competing business of the same type in the immediate vicinity? 
These questions reflect the uncertainty of the buyer's position. The seller knows what he is selling and
what he is getting (with a possible exception in the case of seller financing). The buyer is getting an un-
known quantity. Whether or not the buyer gets the protection he should have as part of the contract is a
matter of bargaining.
A Typical Buy-Sell Contract
Following is a typical buy-sell contract, with comments, covering the sale of the Regal Men's Store. The
contract covers the sale of a proprietorship business, but the basic content would be the same in a cor-
porate stock transaction.
______________
THIS AGREEMENT is made and entered into this 15th day of February, XXX6, between James Rom-
baugh, hereinafter referred to as the Seller, and Joe Critser, hereinafter referred to as the buyer.
WHEREAS the Seller is the owner of a men's clothing store using the trade name of "Regal Men's
Store" in Central City, and the Seller desires to sell to the Buyer his rights, title and interests including
the goodwill therein, and the Buyer is willing to buy the same on the terms and conditions hereinafter
provided, IT IS AGREED AS FOLLOWS:
(The above statements introduce the parties and the nature of the agreement. If the business is incorpo-
rated and a stock transaction contemplated, the stockholders will be identified as the sellers and stock
as the item sold. )
1. Sale of business. The Seller shall sell and the Buyer shall buy, free from all liabilities and encum-
brances except as hereinafter provided, the men’s clothing store owned and conducted by the Seller un-
der the trade name of "Regal Men's Store" at the premises known as 120 North Main Street, Central
City, including the goodwill as a going concern, the lease to such premises, stock in trade, furniture, fix-
tures, equipment and supplies, all of which are more specifically enumerated in Schedule A attached
hereto.
(Paragraph 1 incorporates by reference an inventory not shown here of the assets being purchased. A
specific enumeration of assets being purchased is important as a basis f or recourse against the seller in
the event of shortage or title defects.)
2. Purchase price. The purchase price for all the assets referred to in paragraph 1 shall be $84,000 and
allocable as follows:
Previous page Top Next page