We are considering buying out an existing LLC (it's a management company, and would add some volume to our own successful property management company). Everything looks good financially, however I've not sure what I should look for or how to protect myself from, any possible outstanding taxes or other liabilities that might be hiding out there on the subject acquisition LLC.
Anyone know of a way to check? Would we, and members, be liable, and is there any way to indemnify ourselves against such an event?
Any advice you could give would be appreciated!
Contracts and attornies handle this type of thing, it is exactly why they are used. You really should have them handling that. People can sell you the assets/debts in the business, but not trademarks or names, or contracts they have with clients, etc. It’s endless. Get an attorney that specializes in this type of thing.
As @Levi T. stated, you need an attorney. However you should educate yourself as well.
Google the difference between an asset sale vs a stock sale.
Thanks @Levi T. and @Robert B. for the advice.
After speaking with our attorney and cpa, here's what we decided to do: since the LLC had no real assets except for the contractual agreements with the owners of the managed property, we agreed to have the existing management agreements assigned to our company and notify the owners of the 'merger/assignments'.
Seller has agreed to consult with us for two months after transfer to help smooth any issues, plus indemnification from the seller re no outstanding or pending lawsuits, as of date of transfer, etc.
Cleaner, faster and simpler.
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