Buying or selling a business is one of the most important financial decisions many owners will ever make. While the purchase price matters, it is only one part of the transaction. The structure of the deal and the due diligence process can significantly impact the outcome.

Experienced legal guidance can help you avoid costly surprises. Our trusted business acquisition attorney in Massachusetts can identify risks early and negotiate favorable terms.

At Berluti McLaughlin & Kutchin LLP (BMK), we have more than a decade of experience helping business owners throughout Massachusetts structure and negotiate complex business transactions with practical advice tailored to their goals.

You can reach our lawyers by calling 617-557-3030. 

What Happens in a Negotiation?

Many parties begin negotiations by focusing on valuation. While price is important, a successful acquisition depends on many other issues, including:

  • The transaction structure,
  • Which assets or liabilities transfer,
  • Financing arrangements,
  • Regulatory compliance,
  • Due diligence findings,
  • Arrangements for employees,
  • Representations and warranties,
  • Indemnification obligations,
  • Closing conditions, and
  • Post-closing responsibilities.

Each issue affects the deal’s value and the risk each party assumes.

An experienced corporate transactional lawyer in Boston can help you identify these issues before they become obstacles during negotiations.

What Laws Apply?

Acquisitions often involve both Massachusetts law and federal law. Some laws that might affect your deal include:

  • Massachusetts business entity laws. There are specific laws governing the transfer of ownership interests and assets between different types of entities, including limited liability companies (LLCs) and corporations.
  • Massachusetts’s Uniform Commercial Code. If the transaction involves the sale of business assets, Article 9 of the Massachusetts Uniform Commercial Code may affect the sale.
  • Federal securities laws. The Securities Act of 1933 and the Securities Exchange Act of 1934 regulate many securities transactions, while the Securities and Exchange Commission (SEC) often oversees compliance.

Our business acquisition attorney in Massachusetts can help identify which laws might affect your negotiation and how you can best comply with them.

What Are the Steps for Making Sales?

No two acquisitions are identical, but many transactions or mergers and acquisitions (M&As) follow a similar framework.

Inventory and Valuation

Before seriously starting a negotiation as a seller, you need to have an idea of what your business is worth. You may need to determine the value of your business’s:

  • Active contracts and leases;
  • Intellectual property rights;
  • Equipment, materials, and inventory;
  • Active loans or judgments;
  • Goodwill; and 
  • Trade secrets.

You don’t have to handle this on your own. We have years of experience facilitating business deals and can connect you with valuation professionals for the most accurate appraisals.

Referring to the Law and Your Business Documents

Before you get too deep into a negotiation, check that the sale complies with the law and your previous agreements. For instance, the Commonwealth’s business corporations law or your corporate bylaws might require you to obtain approval from your board of directors and two-thirds approval from your shareholders to merge or exchange shares with another business. 

Your business’s governing documents might add rules or make voting requirements more stringent than the law requires before a sale. You want to make sure that you understand these rules beforehand so that the deal doesn’t leave you vulnerable to legal action.

Letter of Intent

A sale often begins with a letter of intent (LOI). The LOI generally outlines the:

  • Proposed purchase price; 
  • Transaction structure;
  • Timeline for transfers of money, liabilities, and assets;
  • Exclusivity period; 
  • Confidentiality obligations; and 
  • Anticipated closing timeline.

Although many provisions may be nonbinding, carefully negotiating the LOI helps establish expectations before making substantial investments.

M&A Due Diligence in Massachusetts

After signing an LOI, the buyer typically conducts extensive due diligence. This process allows the buyer to verify the seller’s representations and better understand the business before closing.

Comprehensive M&A due diligence in Massachusetts often includes reviewing:

  • Financial statements,
  • Tax records,
  • Organizational documents,
  • Material contracts,
  • Employment agreements,
  • Property titles,
  • Intellectual property,
  • Litigation history,
  • Regulatory compliance documents,
  • Real estate interests, and
  • Outstanding loans and liens.

Due diligence may uncover issues that require additional negotiations or walking away from the sale.

Negotiating and Signing the Purchase Agreement

After due diligence, the parties negotiate the definitive purchase agreement that generally addresses:

  • Purchase price—how to allocate the purchase price between acquiring assets or paying off seller loans;
  • Payment terms—timelines for releasing funds and handling escrow accounts;
  • Assets, ownership interests, or liabilities being transferred—list of what the seller will retain and what they will transfer to the buyer;
  • Closing obligations—filings that each party must make with the Secretary of the Commonwealth to reflect the new, post-sale business;
  • Representations, disclaimers, and warranties—declarations about the characteristics and qualities of transferred assets and whether the seller will cover losses from certain assets;
  • Indemnification provisions—promises from either party to pay liabilities or help defend the other party against claims associated with the sale; and
  • Restrictive covenants—terms about confidentiality or promises for the parties not to compete with each other for a certain period of time or in a certain geographic area.

Each provision allocates risk between buyer and seller and requires careful consideration.

How Can a Business Acquisition Attorney in Massachusetts Help?

An experienced attorney can assist throughout every phase of the transaction by:

  • Advising on the most appropriate transaction structure,
  • Preparing or reviewing letters of intent,
  • Coordinating legal due diligence,
  • Identifying potential risks,
  • Negotiating and drafting terms,
  • Reviewing shareholder or owner approvals,
  • Coordinating with financial professionals,
  • Managing closing documents, and
  • Resolving disputes before they threaten the transaction.

Our experienced corporate transactional lawyer in Boston can also help clients focus negotiations on the issues that matter most while reducing unnecessary conflict.

We Can Craft the Best Deal

At BMK, our top-rated team represents business buyers and sellers throughout Massachusetts. We provide practical advice while helping clients understand both the legal and business implications of every major decision. If you need help, don’t hesitate to call us or contact us online.

Frequently Asked Questions

What Is the Difference Between an Asset Purchase and a Stock Purchase in Massachusetts?

In an asset purchase, the buyer generally acquires selected business assets and may agree to assume specified liabilities. In a stock purchase, the buyer acquires ownership interests in the business.

How Long Does a Typical Business Acquisition Take from LOI to Closing in Massachusetts?

There is no fixed timeline under Massachusetts law. Getting to closing may take several weeks, months, or years, depending on the complexity of the issues.

What Due Diligence Should a Buyer Conduct Before Acquiring a Massachusetts Business?

Every case is different, but a buyer should typically review financial records, tax information, organizational documents, contracts, employment matters, intellectual property, litigation history, regulatory compliance, outstanding debt, liens, licenses, and other material aspects of the business.

What Role Does an Attorney Play in Drafting Indemnification and Representation Clauses in a Purchase Agreement?

An attorney helps draft these provisions to clearly allocate risk, define available remedies, establish survival periods, negotiate liability limitations, and reduce the likelihood of future disputes.

Legal References Used to Inform This Page

To ensure the accuracy and clarity of this page, we referenced official legal and other resources during the content development process:

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