How to Draft an Acquisition Agreement

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How to Draft an Acquisition Agreement

• Hhs Lawyers and legal consultants

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Step 1 Define the parties involved.

• When drafting an acquisition contract, it is
  absolutely important to accurately provide a list
  of parties and their important information in
  order to avoid confusion. Both the buyer and the
  seller have to provide their complete name and
  full address and other business affiliation, if
  applicable. For instance, the contract should
  state The following is an agreement between
  Mohan of Nair and Associates LLC located in Al
  Rigga Dubai, UAE and Bilal of Floral Shop Life
  located in Burjman, Dubai, UAE. 
• When signing the acquisition agreement, the
  signatories have to use their titles following
  their names in order to provide them with
  protection from a lawsuit. To give an example,
  use Mohan, Owner, Nair, and Associates LLC.  The
  names of the parties that are involved including
  the partners of the sellers and the buyers that
  hold an interest in the contract and transaction
  have to be included. 

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Step 2 Make a list of the items that are
included.   

• Make a list of the items that are included in the
  transaction. This can include the business
  records, name of the company to be acquired,
  physical assets, goodwill, patents, marks that
  are registered and owned, trade secrets,
  inventions, inventory, and licenses among others
  in which the business utilizes in order to
  conduct its operations. If it is possible, there
  should be a list of the assets of the business
  which are categorized by item and quantity. 
• For instance, if the transaction involves the
  sale of a restaurant, there should be an
  indication for the number of chairs and tables,
  refrigerators, ovens, cutlery, staff uniform, and
  other items that the seller plans on trying to
  take or leave to the buyer. Include the
  liabilities also such as bank loans. Of course,
  accounts payable have to be presented in the
  agreement. Include a clause for non-compete that
  may be agreed by both parties in order to prevent
  a seller from competing with the sold business
  after its acquisition. 

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Step 3 Create a disclosure provision. 

• Include a disclosure provision which requires all
  the parties that are involved to state all that
  theyve disclosed regarding lawsuits, debts,
  fines, obligations, and more are complete. This
  is going to make the seller the party that is
  responsible if there is an undisclosed liability
  that the buyer discovers following the sale. This
  will also protect the seller that is financing an
  acquisition from a buyer that has undisclosed bad
  credit. There should be a statement from both the
  seller and the buyer that they are legally the
  owners of the business that they are representing
  which allows them in making the sale or purchase. 

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 Step 4 List all the same terms. 

• Include the sale terms which may be how the
  payment will be given to the seller and the dates
  of payments. If the payment will be made by the
  buyer in installments, this has to be specified
  as well and if the payments would be made by
  check, electronic transfer, credit card, or cash.
  Also, if the seller finances a part or all of the
  acquisition, it should be stated as well as the
  interest rate. If applicable, state if a deposit
  would be one of the requirements. Basically, the
  details that are involved with the process of
  paying the acquisition should be in the
  contract. 
• List any agents or brokers that are involved with
  the transaction and other financial institutions
  that are facilitating the sale. Add a clause that
  details how and where disputes are going to be
  resolved. For instance, there should be a local
  court indicated which will be where a lawsuit is
  going to be brought as well as if the parties
  that are involved wish to have disagreements
  handled by a mediator or an arbitrator in UAE.  

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Step 5 Include a space for the date and signing
of the legal document. 

• Require all the parties that are involved with
  the acquisition in UAE to date and sign the legal
  document. As soon as you have drafted the
  agreement, the attorney of the seller and the
  legal representative of the buyer will review the
  contract prior to its signing. Each section of
  the agreement has to be reviewed thoroughly. Have
  each signatory write on multiple copies in order
  for the parties involved to have original copies. 

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