What you may be inheriting.
WHAT TO EXAMINE
Corporate records and ownership Contracts with customers and suppliers Employment contracts and obligations Leases and property interests Licences and permits Intellectual property and its ownership Litigation and disputes Loans, guarantees and security Insurance and claims history
WHY OWNERSHIP FIRST
You must establish that the seller can actually sell what is being sold.
WHAT TO VERIFY
Shareholdings, at the registry Whether any shares are subject to restriction
WHAT TO EXAMINE IN CONTRACTS
Duration and termination Whether they transfer on a change of ownership Obligations that continue Anything unusually onerous
WHY CHANGE OF CONTROL PROVISIONS MATTER
Some contracts terminate automatically on sale, and the value assumed may disappear.
WHAT TO ESTABLISH
Which customer and supplier contracts contain them.
WHAT TO EXAMINE IN EMPLOYMENT
Who is employed and on what terms Accrued entitlements Any disputes or claims Whether employees transfer automatically
WHY ACCRUED ENTITLEMENTS MATTER
Unpaid leave and termination entitlements are real liabilities.
WHAT TO ESTABLISH
What employment obligations transfer to you.
WHAT TO EXAMINE IN LICENCES
Whether they are current Whether they transfer or must be reapplied for
WHY
A business operating on a licence that does not transfer cannot continue.
WHAT TO SEARCH
Registers for security over assets Court records for proceedings Tax status
WHAT TO ESTABLISH
Whether there are undisclosed liabilities.
WHAT TO ENGAGE
A solicitor, for this work.
