Positioning Your Dental Practice for Sale

Thinking about selling your dental practice is a major career step which cannot be treated lightly. It is imperative to not only stay in step with all the legal practices and procedures to protect against liability issues down the road but also to ensure that you get the most profit possible from the business you’ve worked so hard to create. The process of preparing your dental practice for sale should start months in advance so you can address any issues early and prior to having a purchase agreement in place.

Know the Cost of Selling Your Dental Practice

Before you begin the process of putting your dental office up for sale, it’s a good idea to know all the costs involved. Speaking with your accountant to better understand the tax implications and how to manage equipment issues, unsold goods, employee transfer, and more can help you determine when might be the right time to sell. In some cases, it may be prudent to postpone a sale by a few months or years to get everything in place. You should also meet with a practice consultant that can help re-organize the practice and its flow. An experienced healthcare business attorney can help restructure corporations, contract key employees, prepare a fair market value lease agreement, and even begin to draft key terms for the sale.Continue reading

What to Know When Buying a Dental Practice

Preparing to buy a dental practice may seem like a daunting task. There are many considerations, many of which usually require an expert opinion and guidance. Buying a dental practice involves legal, financing, real estate, and accounting expertise, at the very least, to ensure a smooth deal with the buyer being protected. Here’s what to consider:

Legal

Buying a practice usually means buying the assets of the practice, rather than the corporation itself. In any event, the buyer is taking a significant financial and legal risk and just like any other purchase, you want to make sure that you are getting what you paid for and not any (or at least as little as possible) of the baggage. Every dental transaction should include a well-drafted and thorough purchase agreement which includes substantial representations and warranties by the seller, thorough lists of included and excluded assets, terms addressing restrictive covenants, and disclosures about any potential liabilities affecting the practice. In addition, some transactions might require a portion of the purchase price to be seller financed. In that case, there will be a need for a promissory note and security agreement. As the deal progresses, there might be a need for additional documents to cover an assignment of rights for certain licenses, contracts, and other. Among other things, the final document signed includes a bill a sale, which is like a receipt for the buyer evidencing the sale of the assets.Continue reading