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All Cash Buyer of Assets of Business Has No Products Liability as Successor

The asset buyer had not assumed this liability in the asset purchase agreement and no common ownership or officer director management between buyer and seller. M&A Stories August 26, 2021 Introduction A buyer of the assets of a business can

Posted in all cash deal, asset purchase, continuity of ownership, de facto merger exception, mere continuation, mere continuation exception, product line exception, successor liability Tagged with: ,

Indiana High Court Requires Continuity of Ownership in Successor Liability Claim

Business asset buyer not liable to seller creditor under Indiana’s de facto merger or mere continuation successor liability exceptions to the successor liability doctrine. M&A Stories April 30, 2021 Introduction Successor liability is an important issue when pricing a business

Posted in continuity of enterprise exception, continuity of ownership, de facto merger exception, successor liability Tagged with: ,

Court Finds No De Facto Merger in Purchase of Bankrupt’s Intangibles

Introduction Buyers of manufacturing businesses must always assess product liability risks. Even when buying the assets of the business as opposed to the stock (or LLC membership interests). The deal Here, the manufacturing company in this case made lathes. It

Posted in asset purchase agreement, de facto merger exception, successor liability Tagged with: , ,

Lawsuit Over EBITDA Earnout “Determined in Accordance With Buyer’s Historical Reporting Policies”

Introduction This is another post-closing M&A dispute over an EBITDA earnout. The deal The seller was a San Jose based small security guard service. It sold its assets in September 2016 to a Georgia based nationwide security company with about

Posted in bad faith, corporate overhead, de facto merger exception, earn outs, EBITDA Tagged with: ,

No Buyer De Facto Merger Successor Liability for Seller Debt

Introduction One risk in buying the assets of a business is being sued by a seller creditor for a seller liability that the buyer did not assume in the asset purchase agreement. This risk is much higher when buying all

Posted in all cash deal, de facto merger exception, seller ownership in buyer, successor liability Tagged with: , ,

Cash Buyer of Paper Mill Assets Not Liable for Seller’s CERCLA Liability

Introduction A company is responsible under the federal CERCLA or superfund law, and often state law for cleaning up property it contaminates by hazardous waste disposal. However, the buyer of the assets of the responsible company is generally not liable

Posted in asset purchase agreement, asset seller's liabilities, CERCLA or superfund liability, de facto merger exception, successor liability Tagged with: , , , ,

New Mexico Court rejects application of de facto merger doctrine to buyer of assets of the maker of hot tar holding tanks

In this case, Seller was a maker of a tar lugger, a holding tank for hot tar that is used in the roofing business. In the fall of 2013, Buyer purchased the assets of Seller’s tar lugger business. About a

Posted in de facto merger exception, earnout as ownership interest in buyer, successor liability

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