The Woodlands, TX business attorney Steven C. Earl discusses the legal and financial implications of purchasing the business assets versus the business entity. He advises that one of the first decisions for anyone considering the purchase of a business is determining the level of liability they are willing to assume for the business’s past actions. To make this determination, it is important to understand the difference between purchasing the stock of a business versus acquiring its assets. When acquiring a business’s assets, a buyer can typically do so free and clear of prior liabilities. In contrast, purchasing the stock means acquiring the business along with all of its existing obligations and potential legal or financial issues.