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Acquiring a Business in Utah: Know What You’re Buying

by Norris Law Group on August 28, 2014

Acquiring a Business in Utah: Know What You’re BuyingSo, you’re interested in acquiring a business in Utah. Great! But, as with any purchase, the old Latin phrase caveat emptor, or “buyer, beware” still applies. If you are buying a Utah business, you should “do your homework” first and know exactly what you’ll be buying before “signing on the dotted line.” The Utah State Tax Commission Offers some advice about what business buyers should consider on page 1-4 of their online guide titled Doing Business in Utah.

First, the state recommends that you seek legal advice from an experienced Utah business attorney. You and your attorney can then assess the terms of the purchase, often including (but not limited to):

  • Any assets that will be included in the purchase (buildings, equipment, etc.)
  • Whether and how much “good will” may be part of the price. For example, does the reputation of the business serve to make the business more or less valuable?
  • If “good will” is part of the sale, will the loss of the seller affect the business?
  • Will any special knowledge or expertise leave the business along with the seller?
  • Could you possibly start a similar business on your own—perhaps even for less money?
  • Would you be taking on any existing debts or liabilities?

Once you and your attorney have “worked out all the details,” you may be ready to move ahead with the purchase. But you should not buy the business unless and until you know that the following are all true:

  1. The seller is serious about selling the business to you.
  2. The seller is willing to discuss the exact price and all details of the sale.
  3. The seller is willing to let your attorney or business consultant take a look at all the terms of the sale.

Attorney Graham Norris and his associates at the Norris Law Group serve the residents of Utah County, UT and throughout Utah, Wyoming and Idaho. Contact them today at 801-932-1238 or online for a free consultation.

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