Can someone sell a business if they still have outstanding invoices?

UPDATED: Jul 28, 2011

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Can someone sell a business if they still have outstanding invoices?

Asked on July 28, 2011 Massachusetts


FreeAdvice Contributing Attorney / FreeAdvice Contributing Attorney

Answered 11 years ago | Contributor

Yes, a business can be sold if it has outstanding invoices owed to it, or if the business owes payment on obligations to vendors. It is important that when a businessis being sold that a written agreement is drafted preferably by an experienced business lawyer setting forth what is being purchased and what is not being purchased

The agreement needs to be signed and dated by the buyer and the seller to be valid in most circumstances. One could sell certain assets to certain buyers and then dissolve the company. The same business might wish to sell all assets to one buyer and keep its accounts receivables.

If certain assets are being purchased, it is best to run a UCC search with the secretary of state where the business is operating to make sure there are no recorded liens on the items being purchased in that the liens may reduce the value of the item being purchased.

IMPORTANT NOTICE: The Answer(s) provided above are for general information only. The attorney providing the answer was not serving as the attorney for the person submitting the question or in any attorney-client relationship with such person. Laws may vary from state to state, and sometimes change. Tiny variations in the facts, or a fact not set forth in a question, often can change a legal outcome or an attorney's conclusion. Although has verified the attorney was admitted to practice law in at least one jurisdiction, he or she may not be authorized to practice law in the jurisdiction referred to in the question, nor is he or she necessarily experienced in the area of the law involved. Unlike the information in the Answer(s) above, upon which you should NOT rely, for personal advice you can rely upon we suggest you retain an attorney to represent you.

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