Orange County Business Purchase and Sale Attorneys

For over twenty years, VLF has assisted clients in the buying and selling of their businesses. If you are looking to merge with another company or sell assets, membership interests, shares or sell an entire company, VLF can help you through the three main stages of the deal in an Orange County business sale. We have the resources and expertise to deliver results in Due Diligence; Structuring the Purchase to Include Tangible and Intangible Assets; and Post Acquisitions Covenants / Requirements.

Phase One: Due Diligence

Due diligence is the first phase of any contemplated business sale or acquisition. It is the formal process by which each party examines the ability of the other party to deliver on what was promised, and to create protective firewalls to prevent surprises, to either side, once the deal is done. Like looking under the hood, reviewing the warranty, and determining the finance terms for purchase of a used car, corporate due diligence is probably the most critical phase in determining if the deal makes sense. Not surprisingly, it requires a considerable expenditure of time and analysis on the part of both parties’ legal teams, as well financial and technical personnel.

In some instances, VLF handles all of legal due diligence for one side of the transaction. In others, VLF is brought in by another law firm or the company ownership or management team, in which case our attorneys work directly with the company’s General Counsel or outside counsel to evaluate the acquisition. Although due diligence is typically an extensive process, it allows us to learn what our clients truly seek to accomplish by the deal, and to counsel our clients on potential benefits and synergies versus the potential risks and exposure of consummating the deal with the other side.

On the buy side, VLF works with our client’s management team and its senior financial and technical professionals prior to committing the client to the contemplated purchase.  This includes a review of contractual, regulatory, financial, and technical obligations as well as an analysis of insured and uninsured liability of the target venture.  In many cases, the seller or its management team were so closely involved in the target venture, that certain provisions become necessary to actually transfer the real value, i.e., its relationships and reputation, from one owner to the next. This means identifying post-closing transaction conditions such as non-competes, non-disclosures, and ongoing management and advisory obligations for a defined transition period, as would be necessary for the client to consummate the purchase and ensure a proper transition from one team to another.

Likewise, on the sale side, VLF’s due diligence representation lets the seller not only meet its disclosure obligations, but also determine the buyer’s willingness and ability to perform. This means not only making clear and meaningful disclosures to expedite buyer’s due diligence, but also conducting a reverse due diligence on the potential purchasers and structuring the deal accordingly. In a competitive market space, the seller needs protection against the possibility of a purchaser who is using the process merely to gain insider information about the market or even trade secrets that the seller may have developed. In this scenario, VLF would identify a need for the non-disclosure to contain appropriate remedies for misuse of shared information, and for final documents to allow for the potential re-acquisition of the business on favorable terms if the purchaser does not live up to their promises.

Sometimes deals founder during due diligence because one party does not want to share key information, or because a party discovers a nasty skeleton in the closet about which it did not previously know. Other times due diligence provides the parties with meaningful information to intelligently renegotiate the deal. Either way, proper due diligence is what lets business decision-makers reduce the chance of an unexpected lawsuit.