When you purchase a New York Business, when the deal is finalized, there will be a lot of paperwork. The paperwork’s important contents will be all the documents that will transfer ownership of the New York business (and its assets) to the new owner, the Bill of Sale. Every New York business will have many different types of assets, and every asset will have its kind of transfer document. For example, real estate ownership is transferred by a Deed; stock certificates are transferred (often) by signing them and having new certificates issued; and an Assignment transfers trademarks (and many other assets).
A Bill of Sale is another type of document that transfers ownership. A Bill of Sale transfers ownership of ordinary things like inventory, office furniture, computer equipment, etc. These transfer documents are legal documents that must be adequately prepared and signed. If you plan to buy or sell a business here in NYC, call us at Wright Law Firm NYC at (212) 619-1500.
Requirements of a Bill of Sale
To be legally effective, a Bill of Sale must have several components. First, the Bill of Sale must identify all assets being sold/transferred. Details are often critical. Thus, the transferred vehicles must be identified with VINs and other identifiers when buying/selling a car or truck dealership. Usually, this is done with an exhibit attached to the Bill of Sale. Other components include:
- Date of transfer
- Names of seller and buyer
- Address(es) of where the assets are located
- An amount listed for “consideration” (which is often listed as $10.00 or some other nominal amount)
- A statement that the seller owns the assets and has the authority to sell/transfer the assets
- A statement that the assets are free from any other claims or liens
- Signatures of the Seller and, often, the buyer
- Notarization stamp/language and signature of the notary
Bills of Sale should have Warranties
In addition, a Bill of Sale will generally say something concerning warranties on the assets. Often, a Bill of Sale will state that the sale/transfer is “AS IS” and will disclaim any warranties like the warranty that the assets are fit for the purpose purchased or that the assets are free from defects. With the sale/purchase of a New York business, the buyer is expected to have inspected the assets and done its due diligence. The total purchase price is also likely to reflect the status and state of the sold assets. The parties are, of course, free to negotiate and agree to any set of warranties for assets being transferred. And the Bill of Sale should reflect that agreement.
A Bill of Sale is the only document needed to transfer ownership. This differs from other transfer documents, where a second step is required to transfer ownership legally. For example, a transfer of ownership to a motorcycle is only complete when the New York State Department of Motor Vehicles issues the new vehicle title.
Buying or Selling a Business? Contact Wright Law Firm NYC Today
For more information, or if you plan to buy or sell a business here in NYC, call the experienced New York business attorneys at Wright Law Firm NYC. We provide top-tier legal services. To schedule a consultation, please contact our office by e-mail or call us at (212) 619-1500.