The process of two or more companies joining together to form a single business entity is referred to as a merger or an acquisition.

Before purchasing a business:

Review the financial documents of a business, including balance sheets, tax returns, and schedules of accounts receivable, payable, and inventory. The financial information of a company also includes any real estate owned by the business as well as physical assets.

Confirm that the business is in good standing. This information can be obtained by receiving copies of active status reports in the state the business is incorporated in.

Obtain a list of all the locations where the company is authorized to do business.

Review the company's articles of incorporation, bylaws, and minute book.

Find out if the company has any intellectual property, such as patents, trademarks, or copyrights.

Find out if there are any claims against the company's intellectual property, such as a patent infringement lawsuit.

Obtain a list of employees and employee benefits as well as a list of existing and potential customers.

Changes may occur in this area of law. The information provided is brought to you as a public service, and is intended to help you better understand the law in general. It is not intended to be legal advice regarding your particular problem or substitute for the advice of a lawyer.

Back to Top