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Important conditions
concerning the agreement include finance, approval of the vendor's books
of accounts, approval of the terms of any lease involved, the lessor's
approval of any proposed assignment of lease. The parties to such
an agreement must make their identity clear in the sales documents. The
date of the agreement and the time and dates that various segments of
the agreement will become effective are important to consider. Assets
to be considered usually include goodwill, stock in trade, plant and book
debts. Book debts are also sometimes known as accounts receivable and
consist of those unpaid accounts from which future revenue is expected
to derive. Goodwill can be divided into Site Goodwill, the value and security
of a location in a desirable area, and Personal Goodwill, which is the
particular expertise of the owner and staff of the business. Doctrine
of Merger
Facts
On Agreements for Sale or Purchase of a Business
Both
legal and non-legal questions need to be considered in such transactions.
There are preliminary factors that are nn-legal to be considered. Some preliminary
factors to be considered include whether the price reasonable, are there
any chances of improving the net profit, are the trading hours reasonable,
are the parties in good health, and are there any developments in this arena
of trade or business that may affect the viability of the transaction to
either party.
This important doctrine of the common law states that on completion of
a transaction the parties can only sue on the agreements contained in
the actual document that conveyed the estate (property). This means that
if there are any agreements between the parties relating to the sale that
occurred before the final draft document of sale but not included in the
final agreement, may not be enforceable. Essentially, the doctrine means
that when the final sales agreement is and the transaction based upon
it are "completed", only the terms of that final agreement are
enforceable. The transaction is completed when the purchase price has
been paid, possession taken and given, and the transfer of title completed.
