How to Sell a Business in Georgia: Legal Steps and Considerations
Selling a business in Georgia is more than just finding a buyer and signing a contract. Whether it’s a small family-owned company or a growing startup, legal preparation can make or break the sale—affecting your final payout, your future liability, and even whether the deal closes at all.
Here’s a step-by-step guide to help Georgia business owners prepare legally for a sale, avoid common pitfalls, and increase valuation.
1. Organize Your Corporate Records
Buyers perform due diligence. If your corporate records are incomplete, inconsistent, or outdated, it signals disorganization—or worse, legal risk.
Clean up and compile:
Articles of incorporation or organization
Bylaws or operating agreements
Meeting minutes or resolutions
Stock/membership ledgers and ownership records
Business licenses and registrations
Ensure all entity filings are current with the Georgia Secretary of State. You want a clean slate.
2. Review Key Contracts and Agreements
Buyers want assurances that contracts are assignable and enforceable. You’ll want to:
Review lease agreements, vendor contracts, and customer deals
Identify any “change of control” or anti-assignment provisions
Obtain necessary third-party consents in advance
Also check: employee agreements, non-compete clauses, and IP licenses. Any red flags here can delay—or kill—the deal.
3. Settle Any Outstanding Legal Issues
Pending lawsuits, tax problems, or unpaid debts can spook buyers or result in a reduced purchase price. Clean up issues like:
Back taxes or payroll filings
Unresolved disputes with vendors, customers, or employees
Compliance with employment and wage laws
Environmental or regulatory liabilities (for certain industries)
Your goal is to present a business free of landmines.
4. Protect Intellectual Property and Trade Secrets
Buyers place a premium on proprietary assets—names, logos, formulas, and software. Make sure:
Trademarks are registered (state and/or federal)
Copyrights and patents are assigned to the business
Confidential information is protected with enforceable NDAs
All IP created by contractors or employees is properly owned by the business
If your IP isn’t buttoned up, buyers may demand indemnities—or walk away.
5. Understand the Deal Structure
Is this an asset sale or a stock/membership sale? Each has different tax, liability, and operational consequences.
Asset Sale: Buyer picks assets and leaves liabilities behind. More common for smaller deals.
Stock/Ownership Sale: Buyer takes everything, including debt and obligations. Cleaner for sellers but riskier for buyers.
Your counsel should walk you through the tax and legal impact of each. Don’t assume you know which is better without input.
6. Plan for Employee Transitions
Buyers want continuity—but not necessarily with your whole team. Before closing, consider:
Key employee retention packages or stay bonuses
Whether employees will transfer to the buyer or be terminated
COBRA and benefits compliance
Notice obligations under Georgia and federal employment laws
Be ready to communicate clearly with staff after signing.
7. Use a Strong Confidentiality Agreement
Before disclosing sensitive financials or trade secrets, insist that potential buyers sign a tailored NDA. The agreement should:
Prohibit reverse engineering or use of data if no deal happens
Bar solicitation of employees or customers
Include provisions for injunctive relief in case of breach
Avoid one-size-fits-all templates—especially if IP or proprietary processes are involved.
8. Get the Right Legal and Tax Advisors
Selling a business involves corporate law, tax planning, contract negotiation, and risk management. A skilled legal team can:
Identify deal risks
Draft and negotiate the purchase agreement
Help allocate liabilities and tax exposure
Protect you after closing (via reps, warranties, indemnities)
This is not the time to DIY your exit.
Selling Smart Means Preparing Early
The most successful business sales are the result of months of preparation. If you’re thinking of selling in the next 12–18 months, now is the time to clean up your business, protect your IP, and get your records in order.
Contact us today to discuss your business sale goals and how to position your company for a smooth, profitable exit.
