The Gillis Firm, PLLC

Your Business is Simply Our Passion.

Medical and Dental Professional Practices



               Call Us: (571) 209-5203

Are you a licensed medical or dental professional seeking to buy an existing practice? Or, are you currently selling your practice?

Whether you are buying or selling a practice, the process is complex since "legal title" is passing either from an individual or a professional entity to a new person.  In some cases, stock ownership/membership in the actual company, itself, is being transferred to effectuate a sale of the assets and goodwill.

Unlike vehicles, equipment and practices do not have a formal title to simply transfer.  All transitions occur through legal agreements and paperwork that undergo a process of negotiations and final approvals.

That's why no two cases are the same.  The process, itself, is unique to each person.  While acquisitions/sales may follow a similar mold, each client circumstance often changes various parts of the deal.  The value of legal services isn't just with a well drafted purchase agreement, but with the ability to assist you through the entire legal process so that all potential issues have been discovered and resolved. 

We often work closely with your representatives--brokers, accountants, CPAs or financial planners-- to help you reach the closing table.  For us, the value in retaining our firm lays with our ability to guide you through the process, not just document preparation. 

Our goal is to give you the confidence and assurance that your deal is handled diligently and professionally.

Our Acquisition Service

We provide full-service (flat-fee) solutions and services as-needed, to assist you in all aspects of your practice acquisition/sale.  We often encourage clients to take advantage of our full-service, flat-fee solutions to ensure that the legal bill is your last concern.  We work aggressively and professionally to give you quality service and confidence. As a courtesy to working professionals, we provide after-hours teleconference options to discuss your case.  We offer a free extended, 25 minute consultation to medical/dental professionals to discuss your potential sale/acquisition needs. Please feel free to call or email us with inquiries.

The Acquisition Process

Whether you are a buyer or seller of a practice, the life cycle of a transaction often stays the same. Below is a summary of what to expect: 

1) Listing Period-- this is the time when sellers list their practices and buyers start touring practices that they are interested in.  This period is crucial because a seller needs to know what sales price he/she can demand for his/her practice.  Using the assistance of an expert valuator or experienced medical/dental brokerage firm that can provide a true valuation helps set the parties' expectations and will assist buyer in obtaining a true loan commitment from an accredited lender. 

2) Offer Period (aka "Letter of Intent" or "Offer to Purchase")--at this stage, an interested buyer expresses interest in a particular practice.  Sellers often request that buyers sign a non-disclosure agreement to allow seller to share the practice's financials with the buyer.  During this stage, Buyer will review the prospective practice's financials and ensure that he/she is also financially qualified to purchase the practice.  

Once buyer is ready to proceed, buyer will make an offer. Seller may request that the buyer place a good-faith deposit to ensure that he/she is serious, or, some sellers are simply satisfied with proof of finance such as a loan commitment letter or proof of funds (if the deal is not being financed). The Letter of Intent is generally not legally binding since Virginia does not accept contracts to enter into a contract, but it is important that the language is clear as to this point.  Otherwise, the parties may be entering into a legally binding contract.  The Letter of Intent is an important document which formalizes the parties' intentions and base-line understandings as they decide to enter into the deal.  For this reason, it is also very important that the parties avoid making oral agreements and understandings if they are not expressly stated in the Letter of Intent.

3) Negotiations/Due Diligence Period-- this is where the bulk of the movement happens in an acquisition transaction. The purchase agreement is drafted and negotiated.  Ancillary legal document are also drafted and negotiated such as employee/contractor agreements (for the transition period), promissory notes, security agreements, etc.   Lending matters are continually negotiated and fulfilled.  Appraisals/valuations are finalized and, in some cases, obtained again if requested by the lender.  Liens/judgments and other potentially adverse findings are investigated to ensure that the practice is being assigned free and clear to the buyer.  Equipment is being inspected.  The accountants may conduct their own reviews. Licenses/certificates are obtained by the buyer, if needed.  If real estate is also subject to the sale, then all of the traditional commercial real estate processes will apply such as environmental assessments, title examinations, etc.

4) Lease Negotiation-- while this is not necessarily a process on its own and often occurs during the due diligence period, it deserves its own section.  If the buyer is not purchasing the real estate upon which the practice is located, then the property is subject to a lease.  Whether the seller is the landlord or a third party landlord exists, this is an equally critical aspect that can make or break a deal.  In most cases, commercial landlords may assign the lease to the buyer if the buyer's financial qualifications match or exceed the current seller's qualifications.  However, this is not always the case.  The lease should always be one of the first issues that are examined and considered.  The seller is often encouraged to make the necessary introduction and to start the conversation with the landlord so that the buyer/buyer's attorney can start assignment and lease negotiation discussions.  It is a bad idea to wait until 1 week before the closing deadline to start working on the lease as it will create undue stress on all parties and it may compromise the new tenant's (buyer's) relationship with his/her new landlord. At the very least, the lease should be provided to the buyer as soon as the Letter of Intent is accepted so that the buyer can be clear of what he/she is expected to take over and potentially negotiate.  It is also important that seller discuss the current security deposit and make sure that all prepaids are properly accounted for so that buyer is not surprised at the closing table.

5) Final Matters/Closing--some legal documents may be signed in advance of the official closing date, such as the purchase agreement or real estate contract (if real estate is part of the transaction).  For instance, the purchase agreement may be signed in advance of the closing date but with certain conditions to be fulfilled in order to consummate the closing.  The lender may request that the landlord/seller continue to sign/review certain documents depending on what loan product the buyer may procure. Ultimately, the closing date will not happen by surprise.  In fact, the parties should always expect some delays to occur that will change the initial closing date estimate.  The "clear to close" will ultimately occur once the lender has received all required documents/fulfillments, the landlord has approved of the transfer, and final reports/inspections have been completed by the buyer.  Buyer/Seller's attorney(s) will generally work with the brokers and lenders to draft a closing statement and provide copies to the buyer and seller 1-2 days before closing.  The closing, itself, can occur in person or electronically in some cases, with advance accommodations. The closing date generally signifies the date that seller is officially transferring the practice to the buyer. 

6) Transitional Matters-- it is important to remember that during the entire process, the parties are building a working relationship with one another to allow for necessary transitions to occur. Some times, the seller agrees to remain on board to assist the buyer with patient and practice transitions including insurance credentialing.  Typical transitional concerns include: 1) changes in administrative controls/access (passwords, websites, billing software, records, etc.); 2) changes in utilities and services (water/electric/gas accounts, telephone, merchant services, etc.); 3) signage changes; 4) patient announcements; 5) transfer of equipment leases (if applicable and not otherwise paid off during the transaction); etc.  It is important that from the start, the parties work well together and maintain effective communications.