One of the documents that should be signed at every business closing is a closing statement. The closing statement should capture all of the money flowing from the transaction. The obvious items to include on a closing statement are the purchase price, deposit, loan payoffs and any seller financing. There are other items, some of them often overlooked, that should appear on the closing statement, including the following:
- Lease adjustments – there should be adjustments to account for monthly rent and for the disposition of the security deposit;
- Working capital adjustments – in some transactions, the purchase price is to be adjusted by a deficit and/or excess of working capital;
- Filing fees – although a small item in amount, most transactions include filing fees for documents that must be filed with public records;
- Personal property tax adjustment – to account for personal property paid or to be paid; and
- Other obligations of the seller – arising as a result of the sale, including broker’s fees, professional fees and stay bonuses.
A thorough and complete closing statement will help to avoid having to deal with money issues after the closing.
If you have any questions about this or any other M&A issue,
please contact Glenn Solomon at firstname.lastname@example.org or 443-738-1522.
ABOUT GLENN D. SOLOMON
Glenn D. Solomon is a principal at Offit Kurman and has provided counsel to businesses and business owners for more than twenty-five years. He has extensive experience in the purchase and sale of businesses, structuring 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 over 130 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 ten 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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