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  • #997333
    hawamahal
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    Hi Guys

    Just a quick question on a business which i recently bought. During the buying process, in the contract I insisted on putting a clause of the maximum stock value which I am going to buy as part of the sale. Now that I have bought the business and the stock value is more than what is in the contract. The seller is pushing me to buy all the stock. ( some of it is very slow moving). I know that under the contract for sale of the business I have an obligation for the maximum value of the stock.

    The question I have is that who has the right to decide what stock I buy as part of the business sale contract. I have a feeling that the seller will insist that I buy the stock which is really not sale able, so that he can sell the excess stock i.e. which is easily sale able. If that happens I will be lumped with the stock which is almost dead stock and all the money I pay for the stock is wasted. I can’t find anything in the sale contract about this.

    Any help will be highly appreciated.

    #1211497
    Paul – FS Concierge
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    The answer seems to be that the contract does not specify what stock you have to buy to complete the terms of the contract so it is time for negotiation and if you can’t come to an agreement then formal legal advice would be advisable.

    #1211498
    Ross Forrester
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    I think your contract is vague.

    I suggest you start arguing that the market value of the old stock is a lot lower.

    #1211499
    hawamahal
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    Thanks for the responses. I re-read the contract yesterday and it states that in case the stock is higher than the maximum value, then the purchaser has the option to select which stock he wants to buy. It is in the general body of the contract. Bit hard to find initially.
    Converting the scanned copy of the contract as a searchable document helped in finding it.

    Hopefully this thread helps someone in future.

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