Resources – Page 10 – Steven M. Bush

The limited liability company permits flexibility for special allocations and distributions of cash and other assets to the owners in a manner similar to that of a limited partnership. Do you need a formal operating agreement to form a LLC? While a formal document, called the Articles of Organization, must be filed with the Colorado […]

What is an “Earn-Out” Provision?

An “earn-out” provision is a method of measuring part of the purchase price for a business based on its financial performance after the closing date. Earn-out provisions are common where the seller continues to be involved in the business after closing, and they provide an efficient way for the seller and the buyer to share […]

What does it mean when a corporation “merges” with another company?

Under Colorado law, a merger is generally treated like a sale of stock. In the merger the buyer, called an “acquirer,” assumes all of the corporation’s assets and liabilities by operation of law and without the need for any other agreement or transaction. Under Colorado law, mergers generally take one of the following forms, and […]

What happens when a company sells its assets?

When a company sells its assets, the seller typically enters into an asset purchase and sales agreement with a buyer. The typical asset purchase agreement contains representations, warranties, covenants, and indemnifications. Like most legal documents, there is no “one-size-fits-all” form asset purchase agreement. At a minimum, the written asset purchase agreement should identify the specific […]

How should I form my business?

The choice of the best type of entity for any particular business involves an analysis of many business and legal considerations. Among the most important factors are: the cost and formality of organization transferability of ownership interests expected life of the enterprise who will manage and control the enterprise the need to obtain capital and […]