Business Lawyers Blog
Engaging in the purchase or sale of a business in Oregon involves certain reporting obligations. Ensuring compliance not only alleviates potential stress but also helps prevent legal liabilities resulting from improper transaction handling. Contact the Oregon business attorneys at Structure Law Group, LLC, for expert guidance regarding Oregon mergers and acquisitions. With extensive experience assisting numerous businesses from startup to sale, we streamline the process of buying and selling business assets for greater efficiency.
A Business Must Be in Good Standing Before Transferring Ownership
Businesses must be registered with the Oregon Secretary of State. All annual reports must be current and all fees paid. If you are selling, double-check that you are in good standing to help you close the sale faster. If you purchase a business, then this is part of your due diligence.
Document the Purchase or Sale
Legal agreements in Oregon and elsewhere are critical because they provide each side with a detailed understanding of what is included in the sale of a business. For example, a basic purchase agreement will identify the terms of the sale, including price and the assets involved.
Double-check to see what assets are included – and excluded – in the sale this can make a significant difference in the complexity and legal budget of the proposed acquisition. Some assets that are typically part of a sale include:
- Equipment
- Assets
- Inventory
- Contracts
- Intellectual Property
- Goodwill
Consider Whether to Include Non-Compete or Non-Solicitation Agreements
When purchasing a business, one must consider whether the seller will be permitted to continue operating similar lines of business after the sale has completed. Savvy entrepreneurs are well advised to think about this question carefully because most buyers do not necessarily expect to have a brand new competitor after Closing has occurred. For example, if the business is in some way unique, a buyer might not want a seller to establish a new identical business the day after the sale of their original business has closed. At the same time, a seller who is selling their business at a low cost in order to move on may not welcome restrictions on future competition particularly if the business is less unique in the grand scheme of things.
In any event, it’s a good idea to speak with an Oregon attorney to review the potential for non-compete or non-solicitation agreements. Unlike other states, such agreements are, in fact, enforceable under Oregon law but must be drafted with care.
Transferring and Applying for Licenses and Permits
The licenses or permits you may need to run a business are usually issued by governmental regulators and whether or not they can be transferred depends on the specific license at issue. For example, a restaurant or bar would need a license to sell alcohol and such licenses are typically transferrable. However, others may not be and so the buyer of a business with a specialized permit or license may have to apply themselves. We can review to determine what licenses and permits apply to your business.
Call Structure Law Group, LLP, for Additional Tips
We can only scratch the surface of the rules a business must follow when buying or selling. We invite you to contact our firm to discuss any proposed sale or purchase of a business.