Legal Blog

M & A Nuggets: Notices Provision- Boring But Important

shutterstock_458979229Every agreement for the purchase and sale of a business should have a section stating exactly how the purchaser and seller will send notices to the other after the agreement is signed.  This concept may seem simple but the language used in this section is sometimes impractical and can cause problems.

First, it is important to understand the purpose of a notice section.  The notice section describes how and to whom notices will be sent.  Notices may need to be sent after the purchase agreement is signed.  Other notices may need to be sent after the closing.  For example, there could be a notice of a breach of the agreement or a notice of a change of address.  Since the parties’ rights are often keyed into a period of time after a notice is sent, the notice language should be drafted to assure that a notice will be received.  Often the notice language states that notices shall be sent by certified mail return receipt requested.  Since that leaves the actual receipt of the notice in the hands of the other side to determine whether to retrieve the certified mail, a better practice is to state that notice is required to be sent either via overnight mail or hand delivery.  In addition to those stated methods, reference should be made that notice can also be sent via email transmission.  Copies of notices should be sent to the parties’ counsel representing them in the transaction.  The parties should also make sure that the address specified in the notice section is an address at which the parties will definitely receive the notice.  By including appropriate notice language, the purchaser will ensure that there will be no kinks in the procedural step necessary to allow the purchaser to enforce its legal rights.

 

ABOUT GLENN D. SOLOMON

Glenn D. Solomon Esq., is a principal at the law firm of Offit Kurman and has provided counsel to businesses and business owners for more than twenty-five years, with extensive experience in the purchase and sale of businessesstructuring ownership agreements, and advising companies in financial distress

ABOUT OFFIT KURMAN

Offit Kurman is one of the fastest-growing, full-service law firms in the Mid-Atlantic region. With 120 attorneys offering a comprehensive range of services in virtually every legal category, the firm is well positioned to meet the needs of dynamic businesses and the people who own and operate them. Our eight offices serve individual and corporate clients in the Maryland, Delaware, New Jersey, and Northern Virginia markets, as well as the Washington DC, Baltimore, Philadelphia, and New York City metropolitan areas. At Offit Kurman, we are our clients’ most trusted legal advisors, professionals who help maximize and protect business value and personal wealth. In every interaction, we consistently maintain our clients’ confidence by remaining focused on furthering their objectives and achieving their goals in an efficient manner. Trust, knowledge, confidence—in a partner, that’s perfect.

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