Introduction The sale of a company usually comes with its goodwill. In fact, in many cases goodwill is the crown jewel of the business. The last thing a buyer wants, is to pay top dollar for the business only to…
Blog Archives
Court Restricts Company Seller’s Nationwide Noncompete to 3 States
Posted in boilerplate provisions, California, choice of law provision, Delaware, noncompete area, reformation Tagged with: California noncompetes, choice of law provision, noncompete area
Buyer Didn’t Waive Seller Breach by Amending Asset Purchase Agreement
Introduction An acquisition of a company is sometimes done in one step: the buyer and seller sign a purchase agreement and immediately close the transaction on the same day. This is called a simultaneous closing. Alternatively, the buyer and seller…
Posted in asset purchase agreement, boilerplate provisions, breach of representations and warranties, breach of seller's covenants, deferred closing, representations and warranties, seller's covenants, waiver provision Tagged with: seller's breach of covenants, seller's breach of representations and warranties, waiver in writing, waiver of breach
S Corp Stock Seller Can Sue Buyer for Not Closing Tax Books Mid-year
Introduction An S corporation does not pay federal corporate income tax. The S corporation passes its income, deductions and credits through to its shareholders, in proportion to their ownership interest in the S corporation. The shareholders then pay income tax…
Posted in allocation of preclosing taxes refunds and credits, boilerplate provisions, further assurance provision, Internal Revenue Code Section 1377 election, purchase agreement, stock purchase agreement Tagged with: S corporation, section 1377 election, short taxable year, stock purchase agreement
Seller of company can sue Buyer for making oral fraudulent and negligent misrepresentations
Seller’s Owner founded Seller in 2002. Seller was based out of the greater Sacramento, California area. In 2007, Seller began doing business as BenefitsCONNECT. BenefitsCONNECT is an online benefits enrollment and administration system that connects employer groups, insurance carriers, third…
Buyer of business can’t stop release of escrowed funds to seller, because buyer did not follow the escrow agreement’s notice provision
Seller held a number of consumer debt accounts in Puerto Rico. Seller first approached Buyer about a possible sale of Seller’s debt accounts sometime in 2013 and, later that year, the parties entered into discussions. The accounts consisted of auto loans,…
Maryland court enforces boilerplate forum selection clause in confidentiality and noncompetition agreement against spouse and related companies of signatory
Buyer is a group of related Maryland companies founded in 1976 and has its world headquarters in Taneytown, Maryland (an hour NW drive from Baltimore). Buyer provides service and makes products in the commercial HVAC, industrial process, power, and industrial…
Court won’t enforce claimed oral modification of stock purchase agreement
Target is a San Diego, California late stage cell therapy company developing laboratory equipment and cell therapies to treat a variety of medical conditions. Cell therapy is taking cells from a donor and putting them into a patient to treat…
Delaware court holds that owner of a buyer of business assets cannot escape liability for fraudulent statements made outside of the asset purchase agreement
The buyer wanted to acquire the seller’s business. The seller was interested in selling its assets to the buyer but was worried about the buyer’s ability to finance the purchase price; especially since a large portion of the purchase price…
Posted in fraud in business sale, integration clause
Boilerplate provision (fraud carve-out) saves the buyer’s fraud lawsuit against the seller of a business
The seller owned and operated a food tray business that sold rigid trays, foam trays, and absorbent pads to food handlers and processors. In the summer of 2014, the seller sought to sell its North American foam tray and pads…
Posted in exclusive remedy, fraud carveout
Importance of boilerplate provisions in business purchase agreement – forum selection clause
Today I want to talk about how a boilerplate provision in an asset purchase agreement can be important when a post-closing dispute breaks out between the buyer and the seller. This example is drawn from a recent case involving the…
Posted in boilerplate provisions, forum selection clause
Recent Comments