Mergers & Acquisitions (M&A) Attorney

Buyers generally prefer an asset purchase because it leaves most historical liabilities with the seller and allows a stepped-up tax basis; sellers generally prefer a share purchase for cleaner tax treatment and a complete exit. Asset purchases are more complex to execute because contracts, licenses, and permits must be individually assigned. If the value of the business sits in non-transferable contracts or licenses, a share purchase may be the only practical route. This choice drives both price and risk, so decide it early.

A straightforward small business acquisition usually takes around three to six months from letter of intent to closing. Due diligence and financing are the phases that determine the timeline, and third-party consents — landlord approval of a lease assignment, licensing authority sign-off, franchisor consent — are the most common cause of delay. If the acquisition is tied to a visa application, build a substantial buffer into your planning.

The recurring surprises are unpaid payroll and sales taxes, worker misclassification exposure, undisclosed litigation or customer claims, equipment and premises leases with personal guarantees or unfavorable terms, environmental issues on owned property, employee benefit and accrued leave obligations, and IP that the business uses but does not actually own. Most of these are findable in diligence. This is also why indemnification provisions and an escrow holdback matter as much as the purchase price.

It can, and acquiring an operating business is often a stronger path than starting from zero because the business already has revenue, employees, and a track record. For E-2, the investment must be substantial relative to the value of the business, irrevocably committed, and the enterprise must be more than marginal. For EB-5, the requirements are different and include a specific capital amount and a job creation test that an existing business must satisfy in prescribed ways. Structure the acquisition with the visa requirements in mind from the outset — retrofitting a completed purchase is much harder.

Most small and mid-market deals combine several components: cash at closing, a portion held in escrow for a period to cover indemnity claims, sometimes seller financing through a promissory note, and sometimes an earn-out tied to future performance. Working capital adjustments at closing are standard and frequently underestimated by first-time buyers. Structure is often more negotiable than headline price, and it is where a buyer can meaningfully reduce risk.

An earn-out is a portion of the purchase price paid only if the business hits agreed performance targets after closing, and it does shift risk toward the seller — but it protects you only if the metrics are drafted precisely. Disputes arise constantly over how revenue is measured, what expenses are allocated, and whether the buyer's post-closing decisions suppressed performance. Define the metric, the calculation method, the buyer's operating obligations during the period, and a dispute resolution mechanism, or the earn-out becomes the next lawsuit.

In most small business acquisitions, yes — a transition period is usually essential where customer relationships, supplier terms, or operational knowledge sit with the owner. Typical arrangements are a consulting agreement for a defined period, a training commitment written into the purchase agreement, and a non-compete preventing the seller from reopening nearby. Pair the transition with a portion of the price held back until it is complete, which is the most effective way to ensure cooperation.

Many do not transfer at all and must be reapplied for in the buyer's name, which is one of the most underestimated risks in asset deals. Professional licenses are personal and never transfer; liquor licenses, healthcare permits, and industry-specific authorizations often require regulatory approval of the new owner and can take months. Identify every license the business depends on during diligence, confirm the transfer process for each, and make closing conditional on the critical ones being secured.

Trace the numbers to independent sources rather than accepting the seller's summaries — compare tax returns, bank statements, merchant processor reports, and accounting records against each other and look for gaps. Review customer concentration, the recurring versus one-off split, and revenue trends by month rather than annual totals. For cash-heavy businesses, ask for an accountant's quality of earnings analysis. Inconsistency between filed tax returns and the figures presented to you is a significant warning sign, not a negotiating detail.

In a share purchase, employment generally continues unchanged because the employer entity is the same; in an asset purchase, employees are typically terminated by the seller and rehired by the buyer, which means new offer letters, agreements, and benefit enrollment. Accrued vacation, severance obligations, and existing employment agreements need to be allocated explicitly in the purchase agreement. In larger transactions, advance notice requirements may apply. Plan employee communication carefully — key staff leaving at closing can undo the value you paid for.

Yes — foreign buyers can acquire US businesses remotely, with documents executed electronically and funds transferred internationally. Two practical constraints come up: banks apply enhanced due diligence on inbound acquisition funds, so start the banking process early, and certain regulated sectors or transactions near sensitive sites may attract national security review. If the acquisition supports a visa application, the consular officer will also expect to see that you are actually running the business, which eventually requires presence.

Most of an LOI is non-binding, but the provisions that typically do bind you are confidentiality, exclusivity or no-shop for a set period, and allocation of expenses. Exclusivity is the one with real consequences: it locks you out of pursuing alternatives while your diligence clock runs, so negotiate its length carefully. Also be careful with detailed LOIs that are silent on binding effect, since courts look at substance and may find an enforceable agreement where you intended none.

Seller financing is common and often favorable, but the documentation needs to be as careful as a bank's would be: a promissory note with a clear payment schedule and interest, a security agreement giving the seller a lien on the assets, and a definition of default and remedies. As buyer, negotiate a right of offset so you can reduce payments if indemnity claims arise — this is the most valuable protection in a seller-financed deal. Also confirm whether the seller's continued financial interest conflicts with a full and clean transition.

In an asset purchase the buyer generally gets a stepped-up basis in the acquired assets, allowing future depreciation and amortization deductions, while the seller may face higher tax including potential double taxation where a C-Corp is involved. In a stock purchase the seller usually gets favorable capital gains treatment while the buyer inherits the existing tax basis and the company's historical tax exposure. This is the most common point of tension in negotiations, and cross-border buyers should model it with both US and Turkish tax advisers before agreeing on price.

Most acquisition work is hourly, because the workload depends on what diligence turns up rather than on the deal size. What we can do at the start is scope it: a defined diligence phase with a budget cap, then drafting and closing quoted separately once the structure is settled. For smaller asset purchases a flat fee is often possible. What we avoid is a percentage of deal value, which prices the work by your number rather than by the work. Ask for the fee structure in writing before diligence begins.