Selling a Business Attorney in Hackensack, New Jersey

Must All Owners Agree to Sell or Buy a Business?

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Generally not, so we have to look at that both at a legal level and a contract level. In New York for most corporations, for corporations after 1963 only a majority of shareholders need to vote to sell the business, for old corporations before ’63 generally two-thirds. But you also need to look at the shareholders agreement and the bylaws; there might be investors with certain rights. So generally, since we usually do asset purchase agreements it doesn’t matter if not everybody agrees, once the business is sold the money comes in to the seller, and they can distribute it out. If its one of the rare sale of stock or merger agreements in certain instances majority shareholders are entitled to appraisal rights, which gets them the fair market value. But in effect, the fair market value is what you have in the deal itself. So generally speaking, the answer’s no, not everybody needs to agree to go along.

New Jersey business transactions attorney, Harold I. Steinbach, discusses unanimous decisions by owners to sell or buy businesses.

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