Pittsburgh Business Transaction Lawyers
KM&A’s corporate and business attorneys work with clients spanning a wide range of fields, from real estate partnerships to moving truck companies. Because the legal aspects of corporate transactions often interact with related fields like business and employment law, our partners and associates cooperate as a team so as to offer the most comprehensive guidance on business transactions.
Contracts for Purchase or Sale of Goods
For commercial buyers and sellers, contracts are the foundation to successful business transactions. All business owners know that shoddy legal work and form contracts jeopardize business deals; fewer truly realize the significant benefits that well-tuned contracts offer. A thoroughly drafted legal document is much more likely to withstand judicial scrutiny should a dispute arise, protecting your business’s interests and allowing you to confidently execute deals with little worry of unexpected repercussions.
Many contract disputes do not involve any willful intent to deceive, but instead arise out of miscommunication, diverging expectations and the ill will that is inevitably fostered by both. This is why one of our top priorities in drafting, not just transaction contracts but all legal documents, is to bring clarity to all of the salient terms. When contracting parties walk away with different understandings of the document they agreed to, the contract’s framers have failed, and the contracting parties are much more likely to end up in court.
An experienced team of commercial and business attorneys reduces this risk by cutting down on superfluous words and by drafting essential and protective clauses into the document. Even something relatively simple like clear and sensible formatting can reduce misreads. Attorneys accustomed to evaluating documents line by line with their clients ought to know which language and formatting work for and against the reader, but unfortunately many of firms appear deaf to these concerns. As a business manager, be aware of the unseen costs associated with mediocre documents that these firms churn out.
Commercial leases are typically much more complex than residential leases as they must plan for a larger number of contingencies and comply with additional state and municipal regulations. Our business and commercial law specialists discover potential pitfalls in these agreements and present a comprehensive outlook of the range of options available to our commercial clients.
Our advice to clients seeking to sign a commercial lease is centered on making sure that the property your business leases is best suited for its intended purpose. While this sort of advice is highly dependent on the context of the deal, business operators should be aware of the issues potentially ruinous to their project or organization.
A major part of running a business is complying with municipal and federal regulations, and a well planned commercial lease minimizes your risk of fines or litigation. As an example, the Americans with Disabilities Act requires business accessibility for disabled people. The lease should stipulate whether the landlord or the tenant is responsible for any improvements that are necessary to comply with regulations and statutes.
The Uniform Commercial Code (UCC)
The responsibilities and rights of buyers and sellers of goods and services are laid out by Article 2 of the Uniform Commercial Code (UCC). In Pennsylvania, courts only enforce commercial contracts that adhere to the specifications detailed in the UCC.
UCC Implied Warranty
Even when a commercial seller does not include a warranty for their goods, an implied warranty, as set forth by Article 2 of the UCC, requires the goods to conform to certain minimum standards. Goods must be fit for their particular purpose, of ordinary quality, properly packaged and labeled. This implied warranty applies as long as the sold goods are normally provided by the seller. For example, if a Scranton paper sales company decided to sell some used computer equipment, the implied warranty of the UCC would not apply because it is not the sort of item a paper company ordinarily offers for sale.
For commercial sellers, disclaimers on express and implied warranties help to avoid conflicts with dissatisfied buyers. With some limits, the UCC permits sellers to disclaim express and implied warranties.
Our business team advises clients on appropriate circumstances for effective disclaimers and drafts documents that can withstand judicial scrutiny. The bare inclusion of some language saying that there are no warranties usually does not pass muster and will not be enforced by the courts. Instead, judges look for language or phrases that specifically refer to what is being disclaimed. While a range of options for phrasing disclaimers exists, not all are treated equally. Experience in the courtroom and familiarity with recent decisions inform the language we employ in disclaimers, creating a better product for our business clients.
Mergers, Acquisition, and Divestitures
Selling, merging, or purchasing a business may seem as easy as drafting and signing any legal document, but with the complexities involved in these major transactions, a specialized attorney ensures the security of the transaction and contract. Only an experienced team drawing from a wide range of specializations can satisfactorily perform due diligence, provide a wide range of options and assess the risks and benefits of each approach. Business owners know that there is no one right way to plan and execute a major transaction such as a merger or an acquisition. For example, a plan may afford unique tax benefits while restricting future business opportunities. We believe that business owners should set the course for their company, which is why we partner with our clients to develop proposals that work for their particular business.
Dissolution of Business
Once a business entity has ceased to serve its purpose, shareholders and owners may be tempted to simply walk away and forget about it. Perhaps they don’t know of any outstanding obligations or maybe they think it will serve some purpose in the future. Those of us in the business community expend a significant amount of time and effort creating and expanding business entities, but typically, business owners neglect the equally important aspect of winding down and dissolving them. This frequent oversight threatens to possibly become a liability until you have thoroughly completed the process for dissolution.
These are the basic steps you must take in order to properly dissolve a business entity, whether it is a partnership, corporation or sole proprietorship. Some of the legal hurdles may require more attention depending on the type of entity and the details of its organizational documents.
- The board of directors, in consultation with their advising counsel, adopts a plan of liquidation to pay the entity’s indebtedness. The plan is approved by a simple majority of shareholders.
- All known creditors are notified of the impending dissolution. Additional notices are sent to the Internal Revenue Service via Form 966 and to each municipality where the entity’s offices are located.
- Representatives of the dissolving entity next apply for a Corporate Clearance Certificate with the Pennsylvania Department of Revenue and Bureau of Employment Security and submit their final corporate taxes. Once the certificate clearing the entity of all tax liability is received, a public notice is advertised with a law reporter in a local paper.
- Next the entity settles all outstanding debts, even if it is the shareholders to whom the entity is indebted. Crucially, no disbursements or distributions of any kind may take priority over the settling of debts. If the amount of debt exceeds the value of the entity’s assets, the assets are applied equitably and fairly to the creditors and no shareholder receives any distribution.
- Articles of Dissolution as well as the Corporate Clearance Certificate are filed with the Pennsylvania Department of State. The entity’s representatives apply for an out of existence certificate with the Pennsylvania Department of Revenue.
Although it may be tempting to skip one or more of these steps and just pursue an out of existence certificate, Pennsylvania courts ruled that the certificate does not constitute dissolution. Also, be aware that dissolving a business entity does not immediately clear its owners, officers, directors, or shareholders from liability. Claims can still be brought until two years have passed from the date of dissolution. Once that date has passed, those intimately involved with the dissolved entity can finally be certain that no new claims will arise.
Contact us if you require legal help in any of these business areas because we are ready to partner with you to ensure that your business is covered by law.