Over this past weekend I went through boxes and boxes of old files related to business transactions (acquisitions and dispositions). What did I find?
To put it simply: lots of paper! Or as many of my clients and other business owners would say: lots of boilerplate.
Which brings me to the topic of why hiring an experienced business attorney matters in business transactions to the business owner.
The processes of due diligence, negotiating, and documenting the transaction itself are designed to explore and discover the underlying facts about the subject business.
Using these processes an experienced business attorney can then allocate risk relative to the business transaction itself between the buyer and the seller.
If experience did not matter, business owners would be well served by just printing off all of the “boilerplate” related to their business acquisition or disposition from Legal Zoom or elsewhere, and just signing it. But:
- Legal Zoom or an inexperienced attorney can’t and won’t understand all aspects of the subject business and the related relationships.
- They can’t begin to understand and appreciate what is important and what isn’t important – what really matters in your unique transaction.
- They can’t and won’t understand the specific risks involved and how best to allocate those risks or to protect against them.
- Legal Zoom or an inexperienced attorney can’t and won’t understand the people involved, their interests and concerns, the business itself, and what it involves.
- Moreover, Legal Zoom or an inexperienced attorney won’t understand what is typical, reasonable and customary, as far as the risks are concerned and how they are to be allocated and protected against.
All of that so-called boilerplate looks tedious, boring, cut and dried. At times I am sure it looks like anyone with a computer can generate such boilerplate and do it quickly and at minimal expense.
Yes and no. It’s true that anyone with a computer can print off a lot of related boilerplate.
But, without a full and complete understanding of the people involved, the business, the risks involved, how those risks are to be allocated or protected against – the type of understanding best gained from extensive experience – the boilerplate itself cannot begin to effectively address the issues at hand.
So for your business transaction, acquisition or disposition, I’d recommend you avoid turning to Legal Zoom or an inexperienced attorney for help and guidance. Instead, turn to a seasoned professional with hundreds of transactions under his or her belt, and the breadth and depth of understanding that is developed from years of experience.
Latest CLF Headline:
CLF Assists Client in Connection with Acquisition of Shuttered Business
We at The Calkins Law Firm, Ltd. were pleased to assist a longtime Northeast Ohio-based client with its recent acquisition of a shuttered, Florida-based manufacturer. Our client plans to restart the business in Northeast Ohio.
Contact CLF if you are planning a business acquisition!
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Top 10 Business Valuation Terms, Part 2
Courtesy: Skoda Minotti
I have compiled a top 10 countdown of business valuation definitions to help business owners and attorneys gain a better understanding of key terms used in business valuations. Jargon has developed in the field of valuation that, while a second language to valuation experts, may sound foreign to those not familiar with the process.