Mergers and Acquisitions For Dummies (79 page)

The company has filed all required tax returns, and no taxing authority has any liens against the assets of the company.

Seller has made all corporate documentations (articles of incorporation, bylaws, and so on) available to Buyer.

The company has full corporate power, legal right, and corporate authority to operate its business.

Seller has provided a complete list of all arrangements, contracts, and agreements between the company and other parties to the Buyer. This information is usually in the form a schedule.

Seller doesn't need the approval of a domestic or foreign governmental authority to execute the transaction. If Seller does need any approvals, she lists them in a schedule.

Seller actually owns all of the property and assets being sold.

Any property involved in the deal has no pending condemnation proceedings, lawsuits, or administrative actions relating to it.

The company has filed all required tax returns under applicable laws and regulations.

Seller has withheld or paid all taxes.

No tax problems with any governmental entity exist. Details of any issues that do exist appear in a schedule.

Seller represents that financial statements (balance sheet, income statement, and cash flow statement) from the most recent year-end, often audited by an accounting firm, are accurate.

Seller has provided the closing date balance sheet, and that document fairly presents in all material respects the financial condition of the company as of the closing date.

The company has performed appropriate procedures to ensure the year-to-date financials are accurate and correct.