Purchase & Sale Agreements in Connecticut

By Brad MacLiver
Authorship and profile at Google


Pharmacy Listing Agreements are contracts that provide a pharmacy broker with the business seller’s permission to sell their Connecticut drug store. During the process of presenting the business that is being sold to drug store buyers, there will be negotiations and preliminary offers.

     
After the preliminary stages have been negotiated, it is then time to put forth details of the potential pharmacy transaction in the form of a contract. This contract is typically known as the Purchase and Sale Agreement, but it can also be referred as an Asset Purchase and Sale Agreement, a Pharmacy Asset Purchase Agreement, an Asset Purchase Agreement, or other variations of these contract titles. Whatever the title of the contract, you should consider the document as the “blueprint” for transferring the pharmacy business in Connecticut to the new owner.  

Pharmacy Purchase and Sale Agreements detail how much the buyer will agree to pay and what assets the seller will convey to the buyer.  When that agreement is put in writing, it describes the transaction in detail, and it is both accepted and signed by each party, this contract will become a legally binding agreement. Therefore, during the period of negotiated development of the Pharmacy Purchase and Sale Agreement, proper diligence should be taken.

Due to liability issues it is seldom that a Connecticut pharmacy’s corporate stock will be purchased. Therefore, these transactions almost always are only asset purchases.

Elements of the Pharmacy Purchase and Sale Agreement include, but are not limited to: assets being purchase, assets being excluded, aspects of counting and purchasing the inventory, both electronic and hard copies of pharmacy customer files, liabilities, purchase price, closing date, transferring title of the assets being purchased, pharmacy customer file conversion, representations and warranties, non compete, restrictive covenants, transferring the phone, notifying customers, signs, Board of Pharmacy notification, accounts receivables, employment of business seller and pharmacy employees, confidentiality, counting the pharmacy’s inventory, costs associated with the closing, lien searches, actions to be taken before the date of closing, along with the pharmacy’s computers, office equipment, and any automated filling machines.

Although it covers many aspects of transferring the business assets from the pharmacy seller in Connecticut to the new owner, it should be understood that the Purchase & Sale Agreement does not provide tax and legal guidance for the seller. Those issues do not pertain to the buyer of the assets. Therefore, the pharmacy seller should be well advised by a knowledgeable pharmacy broker, accountant, or attorney regarding tax consequences, restrictive covenants, and the structure of the deal. These aspects of the deal may not have any impact from the buyer’s point of view, but if not considered carefully may have affects to the seller’s financial position after the transaction is closed.

Pharmacy owners in Connecticut who are considering selling will benefit when working with a specialist who operates exclusively in the Connecticut pharmacy industry and can provide expert guidance in bringing about a transaction that provides the most benefits regarding the seller’s tax consequences, family and estate planning. Proper planning and a blueprint that structures the transaction appropriately will increase the net amount of money the seller receives for the pharmacy’s assets.

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