Sale of an Insolvent Business as a Going Concern in Georgia

First, determine which components need to remain together to continue operations. These may include equipment, inventory, real estate, trademarks, technical rights, customer data, contracts and business permits. A sale as an economic unit must be distinguished from the sale of the legal entity or its shares; therefore, the assets and liabilities being assumed must be identified individually in the purchase agreement. Third-party consents may be required for contracts, licences, leases and other rights that are not freely transferable. The business must be kept operational until closing to the extent necessary to prevent staff, delivery capacity, data and essential business relationships from being lost unexpectedly. Offers should be compared with the expected proceeds from an individual sale and also assessed in terms of financing certainty, closing conditions and the plan for continuing operations. Encumbrances and the rights of secured creditors must be clarified before the transfer. The purchase agreement should address the allocation of the purchase price, payment, the transfer date, inventory, the allocation of liability and the consequences of any consents not being obtained. The sale requires the approvals provided for in the insolvency proceedings.