Due diligence might possibly be the two most boring words in legal jargon. In plain English, this is the process where a potential buyer or investor evaluates a business to decide if a deal makes sense.
This step is essential when you’re looking to buy, sell, or invite investment into your business.
In this episode, I talk about what to expect during due diligence, and how you can prepare:
- Who pays for due diligence? (and why you might want to consider a good faith deposit during negotiations)
- The important reasons you should use an NDA - nondisclosure or confidentiality agreement
- The different types of documents you’ll be asked to provide
- Why you might be required to produce your tax returns or bank statements and other financial records
- Why you need to make sure that contracts with your key business relationships are in order
- How protecting your intellectual property now could mean a bigger profit if you decide to sell down the road
Key takeaway: Not having your legal house in order can kill a buy/sell or investment deal in an instant. Preparing for due diligence with a trusted attorney and tax advisor can help ensure a successful transaction or agreement.
If you need an NDA (nondisclosure / confidentiality) agreement like the one mentioned in this episode, be sure to check out our contract template store: https://awbfirm.com/contract-templates/ Our templates are fully customizable by you and available for immediate download!
Additional Resources:
- Legal Road Map® episode 43 with bookkeeper, Heather Pranitis, of Number Nerd Bookkeeping Solutions:
- Emily Ramsey with J. Smith Lanier in Chattanooga - risk management and insurance for large or high-risk companies, regardless of your location:
- Contract template store: https://awbfirm.com/contract-templates/
This podcast is information, not legal advice specific to your situation.
