Most business acquisitions are structured as purchases of assets in order to insulate the buyer from exposure to the liabilities of the seller. While that is generally an effective strategy, there are exceptions and nuances that are explored in this article relative to the purchase of a business located in the State of Ohio.
Ohio, like most States, imposes a sales tax, with certain exceptions, upon retail sales made in this State. Although it is the buyer of an item subject to sales tax that is obligated to pay the tax, it is the seller, assuming that it has nexus with Ohio, that must collect the tax on the sale and remit it to the State. The Ohio sales tax rate is 5.75%, and the Counties on behalf of themselves and other governmental organizations, can add additional so-called piggy back taxes increasing the tax rate. The piggy back sales tax rate in Cuyahoga County, for example, is 2.75%. Information on sales tax rates in the various jurisdictions in Ohio can be located at the following link: https://www.tax.ohio.gov/sales_and_use/rate_changes.aspx.
A purchaser of the assets of a business will be liable for any unpaid sales tax of the seller, as well as any accrued interest and penalties related thereto, if it does not withhold from the purchase price for such assets an amount sufficient to pay such taxes, interest, and penalties. The amount withheld from the purchase price must not be paid to the seller until such time as it obtains from the Ohio Tax Commissioner a receipt indicating all taxes have been paid, or a certificate indicating no taxes are due.
The seller must file a final sales tax return within 15 days after the date of sale of the business and the seller should then file a Form D5 with the Ohio Department of Taxation requesting a tax clearance certificate. The request should be sent to the Ohio Department of Taxation P.O. Box 182382 Columbus, Ohio, 43218-2382. The seller should then close the seller’s vendor license with the Ohio Department of Taxation. A Form D5 must be filed and a tax clearance certificate obtained by a corporation before it may dissolve, surrender its vendor’s permit, consolidate, merge, or convert into another entity. If the seller has a liquor license, the liquor license cannot be transferred and may be suspended or revoked if all of the seller’s sales taxes are not paid.
The sale of assets to a buyer may itself be subject to Ohio sales tax. The sale of most assets should be exempt from taxation because they are being used in connection with the manufacturing of property for resale, are being sold at wholesale rather than retail, or because they qualify for the causal sale exemption. There is, however, an exclusion from the casual sale exemption for sales of motor vehicles and, accordingly, the buyer will have to pay sales tax in order to acquire title to such vehicles.
Commercial Activity Tax
Ohio does not impose a franchise tax on corporations doing business in the State, but all commercial enterprises with substantial nexus with the State are required to pay a commercial activity tax (“CAT”) upon their gross receipts. On gross receipts in excess of $1 million, the CAT rate is .26%. The liability of all businesses forming a consolidated or combined group under the applicable statute is joint and several.
Like the Ohio sales tax, upon a sale of an Ohio business, which is defined as including a sale of at least 75% of the assets of a business other than in the ordinary course of business, or a sale resulting in a termination of the seller’s business, the purchaser may be liable for the seller’s unpaid CAT taxes and any applicable interest and penalties if it does not withhold from the purchase price a sufficient amount to pay such taxes, interest and penalties. The withheld amount must not be paid to the seller until it has received from the Tax Commissioner a receipt showing all taxes are paid, or a certificate indicating no taxes are due.
Income Tax Withholding
Like any governmental agency that imposes an income tax, Ohio requires employers who have employees in the State to deduct, withhold and remit to the State of Ohio, taxes upon the compensation paid to its employees. If an Ohio employer sells its business or inventory, the seller must file a final return within 15 days after the date of the sale. The buyer will be liable for the seller’s unpaid income tax withholding, interest and penalties if the buyer does not withhold a sufficient amount of the purchase price to pay those taxes, interest and penalties before receiving from the Ohio Tax Commissioner a receipt indicating the taxes have been paid, or a certificate that no taxes are due. Interestingly, this statute provides that the Tax Commissioner may adjust the liability of the seller, or the responsibility of the purchaser, for income tax withholding, if required to ensure that the State collects the maximum of withholding tax revenue. Presumably, this is in order to persuade a buyer to purchase a business where the potential tax liability exceeds the purchase price. A similar provision is not included in the sales tax or CAT statutes.
Debtor Relief Proceedings
If a seller has not paid its Ohio taxes that is generally because its business is in financial distress. This raises the issue of whether a purchaser of the assets of a business can avoid liability for the seller’s taxes by making the purchase as part of a debtor relief proceeding. Purchasers have argued that since the sale is being conducted by someone other than the seller of the business that owed the taxes, the statutes cited above do not apply. In two cases, Common Pleas Courts have held that a sale of assets by a receiver in a receivership proceeding, or a Sheriff at a foreclosure sale, are not sales by the taxpayer who owed State taxes, and the purchaser therefore acquired the assets sold free of trailing State tax liabilities. In a later Court of Appeals decision pertaining to a Chapter 11 Bankruptcy Court proceeding, the Court of Appeals for Hamilton County held that a sale by a debtor in possession with bankruptcy court approval could be subject to successor liability under RC § 5739.14 and reversed a trial court decision citing these Common Pleas Court opinions. The Appeals Court reasoned that in a Chapter 11 proceeding the seller of the assets is not the Bankruptcy Court and so the purchaser could be subject to the obligation to withhold potential State tax liability from the purchase price. The Bankruptcy Court Order approving the sale was unclear as to whether the purchaser acquired title free of the claims of the Ohio Department of Taxation and the Court of Appeals remanded the case for the trial court to make that determination. It certainly seems that a purchaser in a judicial proceeding can acquire title to assets of a business free from liability for Ohio State taxes, but only if the Court Order approving the sale so provides, and counsel for such a purchaser should make certain that the Order is properly drafted. As set forth below, Section 363 of the Bankruptcy Code specifically authorizes a sale free and clear of all claims and interests including those of State tax authorities.
Under Article 9 of Ohio’s version of the Uniform Commercial Code, a secured party may sell assets constituting collateral pledged by a debtor to a buyer free and clear of: (i) all of the debtor’s rights in the collateral; (2) the security interest of the secured party; and (3) any subordinate security interest or lien in the assets being sold. Thus, a secured party can transfer assets of a troubled business to a buyer free and clear of any State tax liabilities provided that the secured Party has a priority security interest over that of the Department of Taxation in the assets being sold. The Ohio Supreme Court has held that the acquisition by a secured party of the assets of the debtor under a security agreement is not a sale subject to successor liability for sales tax.
A buyer of the assets of a business may be liable to the seller’s creditors if the acquisition is deemed to be a fraudulent transfer. Ohio has adopted the Uniform Fraudulent Transfer Act, which is codified in Chapter 1336 of the Revised Code. Ohio law distinguishes between actual fraud and fraud in law. Thus, if a seller disposes of its assets with “actual intent to hinder, delay, or defraud any creditor,” then the transfer is fraudulent. But a creditor need not prove actual fraud. A transfer is also fraudulent if the transfer was made for “less than reasonably equivalent value and the transferor was rendered insolvent.” 
The Federal Bankruptcy Code also contains a fraudulent transfer provision that allows a bankruptcy trustee, on behalf of creditors, to avoid a transfer made with actual intent to hinder, delay, or defraud creditors, or made with less than reasonably equivalent value that left the debtor insolvent. Thus, a buyer should take precautions when purchasing a business from a seller who is insolvent or may be rendered insolvent as a result of the purchase.
Ohio provides a number of remedies if a sale of a business is found to be a fraudulent transfer. These remedies include an injunction against further disposition of property, the appointment of a receiver to take charge of the assets transferred, avoidance of the transfer, or attachment or garnishment of the transferred property. In practice, if the purchaser of a troubled business is found to have paid inadequate consideration, the purchaser will be required to pay more to the creditor or creditors bringing an action under the Uniform Fraudulent Transfer Act.
Ohio law recognizes certain defenses to a fraudulent transfer action. For example, a transferee that acts in good faith and pays a reasonably equivalent value for the purchased assets has a complete defense to a fraudulent transfer action, even if the selling party engaged in actual fraud. Indeed, the fact that the purchaser pays reasonably equivalent value is itself evidence that it did not engage in fraud, but rather acted in good faith. Even if a transfer is voided as being fraudulent because the purchaser did not pay reasonably equivalent value for the assets transferred, if the purchaser acted in good faith, the purchaser has a lien on those assets to the extent of the amount of the value paid.
Although there are some technical differences, the bankruptcy fraudulent transfer provisions are similar to the Uniform Fraudulent Transfer Act. Bankruptcy provides substantially the same defenses. 
How can a purchaser of a financially troubled business protect itself from a fraudulent transfer action? First, the purchaser could obtain an appraisal or opinion as to the value of the assets being purchased. Provided that the consideration paid is reasonably equivalent to the appraised or opined value, the purchaser has evidence that it did act in good faith and it is paying reasonably equivalent value. An appraisal or valuation opinion can be used to defend against any potential fraudulent transfer action that claims that the purchaser did not pay reasonably equivalent value.
A better strategy, however, is to purchase the assets of a troubled business through a court proceeding in which an order is entered authorizing the transfer of the assets to the purchaser free of any liens or claims. Ohio law allows a court appointed receiver to sell assets “free and clear of liens” subject to court approval. In such a case, the selling party may be the receiver over the financially troubled company whose assets are acquired by the purchaser. By going through the court proceeding, the rights of creditors are cut off once the court enters a final order authorizing the sale. In essence, it forces creditors who object to the adequacy of the purchase consideration to make their objections before the sale closes.
The Federal Bankruptcy Code provides a similar procedure whereby a purchaser of assets can acquire them free and clear of liens, claims and encumbrances through what is called a “Section 363” sale. Although the procedure in bankruptcy is somewhat different than a State court receivership, the goal is the same. After the sale closes, no creditor of the business whose assets are sold can complain about the adequacy of the price. Instead, the creditor must lodge an objection before the sale closes.
Although this procedure provides greater protection, it does come with some risk. The primary risk is that the proposed purchaser might be outbid by another person who wants to acquire the assets. But it is precisely that risk which provides the protection. By acquiring the assets of the troubled business through an open court proceeding, the winning bidder can show that it made the “highest and best” offer for the assets.
Real Property Conveyance Fee
Ohio County Auditors charge a fee upon the filing of a deed for the conveyance of real property in this State equal to 10 cents for each $100, or fraction of $100, of the value of the real property. A buyer does not have to pay this fee, but the deed for the property purchased by the buyer will not be recorded if this fee is not paid. The buyer must file a Statement with the County Auditor (Form DTE 100) reporting the purchase price and thereby establishing the basis for determining the amount of the conveyance fee. Certain conveyances are exempt from the conveyance fee, including distributions from a business entity to its owners, and capital contributions to a business entity in consideration for the issuance of an interest therein.
The sale of an interest in a business entity that owns real property is not subject to the real property conveyance fee. This has led taxpayers for many years to transfer real property to a business entity and then sell the entity to a buyer. This not only enabled the seller to escape the conveyance fee, but also avoided an obligation by the buyer to report the selling price, which, if it is higher than the real property tax value, will likely increase the value of the property for real property tax purposes. County auditors and school boards have become aware of this technique in recent years and regularly challenge the valuation of real property transferred in such a manner – if they know of the transfer. If the acquisition is financed with the real estate as collateral, the filing of a mortgage may notify the governmental authorities of the sale causing them to challenge valuation and perhaps attempt to impose a conveyance fee. Legislation has been proposed to close this perceived loophole by requiring sellers to report when selling an entity which merely owns real property and subjecting the sale to conveyance fees. The proposed legislation has not been adopted, however, and at least for the near term, there is no significant prospect of such legislation being enacted, meaning taxpayers can continue utilizing this structure to reduce transaction costs on sales of Ohio real estate.
Ohio is one of the relatively few States in the Country where most employers are required to purchase workers’ compensation insurance from the State; in most other States employers purchase workers compensation insurance from non-governmental insurance companies. In Ohio, larger employers who have the required financial wherewithal are able to self-insure their workers’ compensation liability. When an Ohio employer sells the assets of a business to a buyer, the buyer’s actuarial exposure for worker’s compensation claims will be based upon the seller’s experience. If the buyer purchases insurance to cover this risk, the premiums that must be paid therefor will be determined based on seller’s experience. If the buyer will be insured by the Bureau of Workers’ Compensation after the sale, the seller’s experience will impact the buyer’s premium from an actuarial perspective if the buyer is deemed to be a successor of the seller. If the buyer is a new employer without experience in the State of Ohio, then the seller’s rate will determine that of the buyer. Where both the buyer and seller have experience in the State of Ohio, then the premium of the buyer will be determined by the combined experience of the buyer and seller.
A purchaser will be treated as a successor to a seller if the purchaser succeeds to the operation of the acquired business. Whether the predecessor’s transfer to the successor is voluntary or through an intermediary, such as a bank or a receivership, the buyer will be treated as a successor if (i) it expressly or implicitly agrees to assume the seller’s workers’ compensation obligations, (ii) the acquisition is treated as a de facto consolidation or merger; (iii) the successor is a mere continuation of the seller, or (iv) the acquisition was entered into for the purpose of escaping obligations under the workers’ compensation law.
Notwithstanding the foregoing, a buyer will not be treated as a successor if all of the following are true: there is a material change in ownership of the business, a change in the governing classification of the business, and a change in the process, safety risks or hazards associated with the operation of the business. The buyer will also not be treated by the Ohio Bureau of Worker’s Compensation as a successor if the purchase occurs more than six months after a cessation of operations by the seller, and there is no family relationship or other connection between the purchaser and seller.
A purchaser of a business who is a successor takes over the risks related to the seller’s workers’ compensation accounts and associated rights and obligations. The purchaser is also responsible for any unpaid premiums, fees, or assessments owed to the Bureau of Workers’ Compensation by the seller, and the cost of any claims of the acquired business related to work place injuries not covered by workers’ compensation insurance.
The Ohio Supreme Court has held that a buyer of a business may be treated as a successor even though it acquired from the seller only selected assets or locations and the right to contract with certain of the seller’s customers. A buyer must, however, acquire at least some assets from the seller to be treated as a successor. Under a prior version of the successorship rule cited above, the Ohio Supreme Court held that a manager of an apartment complex was not a successor to a prior management company when the manager acquired no assets from the management company, but only hired some of its former employees and assumed management of the apartment leases. An affiliate of the manager purchased the building from a third party who had contracted with the prior management company. The Supreme Court held that since the manager had not acquired any assets from the prior management company, it could not be a successor thereto. As the Supreme Court’s holding in the cited case was unanimous and the prior version of the rule was not materially different from the existing rule as it relates to this issue, it is likely that the holding in that case continues in effect under the new version of the applicable provision of the Ohio Administrative Code.
The foregoing demonstrates the importance of the purchaser acquainting itself with the experience, rights and obligations associated with the seller’s workers’ compensation account. Accordingly, the purchaser should file with the Bureau of Workers’ Compensation Form AC-4 prior to an acquisition in order to acquire that information. If the buyer has not previously participated in the workers’ compensation system, then it must file a Form U-3 Application for Ohio Workers’ Compensation coverage which requires disclosure of information concerning the acquisition of the business of which the buyer is the successor. If the buyer is already participating in the workers’ compensation system, then it must file a Form U-118 notifying the Bureau of Workers’ Compensation of the acquisition. If the Buyer is acquiring only a portion of the seller’s business, the Bureau of Workers’ Compensation will transfer to the succeeding employer only the experience related to that portion of the former employer’s business that is being acquired.
If the seller participates in the Ohio Bureau of Workers’ Compensation insurance fund and the buyer does not, then the buyer will have to pay (or cause the seller to pay) any actuarial amount computed by the Bureau required to exit the insurance fund. Similarly, if the buyer participates in the workers’ compensation insurance fund and, after the acquisition, the seller wishes to exit the fund, there must be an appropriate actuarial payment to the Bureau of Workers’ Compensation.
Unemployment Compensation Experience
If a seller of an Ohio business transfers of all its business to a purchaser, the purchaser will be the successor to the seller for Ohio unemployment compensation purposes and the purchaser will assume the resources and liabilities of the seller’s Ohio unemployment compensation insurance account and continue the payment of all contributions, or payment in lieu of contributions, due with respect thereto.The buyer should file a GFS 20101 with the Ohio Department of Job and Family Services (the “ODJFS”) which will provide the information to effectuate the transfer of the account.
The buyer of a business will also be treated as a successor for Ohio unemployment compensation insurance purposes if it acquires substantially all of the business from a seller and it files an application with the Director of ODJFS on Form No. JFS 201118. An acquisition will be treated as of substantially all of a business if the buyer acquires 75% or more of the assets of the seller located in the State of Ohio, and immediately after the acquisition the buyer employs 75% or more of the employees covered under the Ohio unemployment compensation law immediately prior to the sale.
Even if the buyer acquires less than substantially all of the seller’s business in Ohio, there may still be a transfer of a portion of the seller’s Ohio unemployment compensation insurance account if the acquisition is of a clearly segregable and identifiable portion of the acquiror’s business, and after the transfer the buyer employs substantially the same individuals covered under the Ohio unemployment compensation law who immediately prior to the transfer were employed by the seller in such portion of the business and an application is filed by the seller and buyer using Form JFS 201119. If there is a transfer of a portion of a business by a seller to a buyer and both parties are under common ownership and/or control, then the unemployment experience and outstanding debt attributable to the transferred portion of the business must be transferred by the seller to the buyer.
Notwithstanding the foregoing, whenever a buyer who is not an Ohio employer who is covered by unemployment insurance acquires a business, if the acquisition is made solely or primarily for the purposes of obtaining a lower rate of contributions, the buyer will be assigned a new employer rate under ORC § 4141.25(A)(1).
General Successor Liability
The courts of most States, including Ohio, have developed common law doctrines for holding the purchaser of the assets of a corporation (or presumably any other business entity such as a limited liability company) liable for the obligations of the seller. Those judicial doctrines are identified and discussed below. Most courts, including Ohio, have recognized four situations where it is appropriate for the seller’s creditors to pursue claims against a purchaser of its assets. Those situations are as follows: (i) an assumption of liabilities, (i) a de facto consolidation or merger, (iii) the buyer is a mere continuation of the seller; or (iv) the sale was entered into fraudulently for the purpose of escaping liability to the seller’s creditors. 
a) Assumption of Liabilities
Of course, a buyer who assumes the liabilities of a seller will be responsible therefor. The point seems to be here that courts may find an implied agreement to assume a liability or liabilities where there is no express assumption thereof. In Cintas Corporation v. Great Lakes Best One Tire & Service, LLC, an Ohio Court of Appeals found that the buyer of the assets of a business implicitly assumed a uniform rental contract entered into by the seller where the purchase agreement provided that the buyer assumed all liabilities to suppliers for materials and services ordered in the ordinary course of business consistent with past practices, including, without limitation, those set forth on a schedule. The contract with Cintas Corporation was not listed on the schedule but the court found that it was assumed by the buyer as a contract entered into in the ordinary course of business consistent with past practice. The existence of such cases have caused drafters of most Purchase Agreements to include not only a provision precisely defining what liabilities are being assumed during an acquisition, but also a provision denoting a non-exclusive list of those liabilities that are expressly not being assumed.
b) De facto consolidation or merger
A de facto consolidation or merger is an acquisition of the assets of a corporation or other business entity that is the substantial equivalent of a consolidation or merger under the Ohio Revised Code, except for the procedural requirements of the applicable statutes. The essential facts that are evidence of de facto consolidation or merger are the following:
i. continuation of the business activity of the seller with the same personnel;
ii. continuity of ownership resulting from the issuance of equity in the buyer in consideration of the acquisition of the assets of the seller;
iii. the immediate or rapid dissolution of the seller following the sale; and
iv. the assumption by the buyer of all liabilities and obligations ordinarily necessary to continue the seller’s business.
Although a dissolution of the seller is explicitly noted as a component of a de facto consolidation or merger, courts have been willing to disregard this requirement, at least where the selling entity does not retain sufficient assets to pay its creditors. The scope of the de facto consolidation or merger doctrine is relatively narrow and does not apply when the buyer does not have common owners with the seller, and may not apply if the buyer does not issue equity to the seller. It is likely that an issuance of equity in the buyer in consideration for an acquisition of assets would not be required if the owners of the buyer are the same as the seller since the equity issuance would have no meaningful economic effect.
c) Buyer is a mere continuation of the Seller
Some courts, including those in Ohio, have held a purchaser responsible for the liabilities of a seller where the purchaser is a mere continuation of the seller. The factors that must be present for this doctrine to apply are similar to those that evidence a de factor consolidation or merger, except for the issuance of equity for assets. The factors are identified below:
i. the presence of significant shared features common to the buyer and the seller such as the same employees, a common name, or the same management;
ii. the seller is dissolved or liquidated soon after the sale;
iii. inadequate consideration is being paid to the seller; and
iv. identity of ownership as between the seller and buyer.
Courts in other States have not required the presence of all of these factors, other than the continuation of business operations, for application of this doctrine, but that is not the case in Ohio. For example, the California Supreme Court has held that successor liability may apply to a buyer who continues to manufacture a line of products formerly manufactured by the seller (referred to as the “product line doctrine”).
Although a purchaser of a business will not be liable in Ohio merely because it continues to manufacture and sell products manufactured by the seller, the products may be sold into States such as California that have adopted the product line doctrine and that may expose a purchaser to liability under the laws of that State. In addition, a plaintiff injured by a product sold by a seller may assert liability against a buyer of the business who manufactured that product for a failure to warn of a defect therein. Ohio courts have generally rejected such claims but, if the facts were such that the buyer become aware of a defective product line, a person injured by the product may be able to establish a purchaser’s liability for failure to warn of the defect.
Another potential successor liability for a buyer of the assets of a business relates to environmental contamination caused by the seller, in particular under CERCLA.  Although some courts have looked to federal common law to determine whether a buyer will be subject to successor liability under CERCLA, in the federal district courts subject to the oversight of the Sixth Circuit Court of Appeals (which includes Ohio), applicable State law will determine this issue. For example, such courts have held that a general assumption of liabilities can, and presumably does, include an assumption of environmental liabilities. On the other hand, where a contract expressly dealt with the assumption of environmental liabilities, the courts have accepted the limitations thereon in such contracts. Courts have also applied the de facto merger doctrine to impose successor liability under CERCLA. 
In Ohio, a purchaser of assets may be held liable for a seller’s violation of employment laws, or for the remedying of such a violation, if the purchaser is the successor to the seller’s operations. The Sixth Circuit Court of Appeals has recognized successor liability in the employment context and stated “the appropriateness of successor liability depends on whether the imposition of such liability would be equitable.”
Federal courts in the Sixth Circuit balance the following to determine successor liability: “1) the interests of the defendant-employer, 2) the interests of the plaintiff-employee, and 3) the goals of federal policy, in light of the particular facts of a case and the particular legal obligation at issue.” The courts have identified the following factors to be considered when addressing the issue of successor liability in the context of employment claims: (1) whether the new employer had notice of the charge or claim before the acquisition of the business; (2) the ability of the predecessor to provide relief; (3) whether the new employer uses the same facility; (4) whether there has been substantial continuity of business operations; (5) whether the new employer uses the same or substantially same workforce; (6) whether the new employer uses the same or substantially same supervisory personnel; (7) whether the same jobs exist under substantially the same working conditions; (8) whether the new employer uses the same machinery, equipment and methods of production; and (9) whether the new employer produces or offers substantially the same product or services.
Although the Sixth Circuit Court of Appeals has not directly determined whether successor liability applies to Fair Labor Standard Act (“FLSA”) claims, the federal doctrine of successor liability addressed above was found to apply to FLSA claims. However, for claims under the Ohio Minimum Fair Wage Standards Act (“OMWSA”), the federal standard for successor liability was inapplicable, and Ohio successor liability law applied. Thus, a successor business may be held liable for violations under the OMWSA when: “(1) the buyer expressly or impliedly agrees to assume such liability; (2) the transaction amounts to a de facto consolidation or merger; (3) the buyer corporation is merely a continuation of the seller corporation; or (4) the transaction is entered into fraudulently for the purpose of escaping liability.”
Federal law governs successor liability in the context of unfair labor practices under the National Labor Relations Act.
A purchaser of the assets of a business should review the applicability of the federal Worker Adjustment and Retraining Notification Act (“WARN”) to the transaction. Ohio does not have a “mini-WARN” law. However, under a notice provision of the Ohio Unemployment Compensation Law, employers must inform the ODJFS of a layoff or separation of 50 or more employees because of a lack of work within any seven-day period. The notice must be provided to ODJFS at least three working days before the first day of the separation or lay off. The foregoing ODJFS notice provision does not address penalties for failure to provide the notice.
Non-compete agreements between a seller and its employees may be an asset that a purchaser would like to acquire. In Ohio, the language of the agreement with the seller’s employees will be controlling. The Ohio Supreme Court has held that because non-compete agreements between employees and their employer did not state that they could be assigned or will carry over to successors, the named parties intended the agreements only to operate between themselves—the employees and the specific employer. Accordingly, if “successors and assigns” language is absent from the non-compete agreement, the seller will be unable to assign the agreement to the purchaser.
A purchaser of the assets of an Ohio business does have exposure to certain of the seller’s liabilities. A lawyer representing a buyer of such a business should advise his or her client as to the means of quantifying and minimizing those risks. This article should be helpful in enabling attorneys to fulfill that responsibility.
 Mr. Malone was assisted in the preparation of this Article by the following members of Buckingham, Doolittle & Burroughs, LLC: Richard Fry, Susan Rogers, Patrick Keating, Dale Nowak, and Marcus Robertson.
 A more general discussion of this subject appears in a memorandum dealing with successor liability in asset acquisition transactions dated January 12, 2019 authored by the Judicial Interpretations Working Group of the ABA M&A Committee of the Business Law Section which can be found in the M&A Lawyer’s Library maintained by the M&A Jurisprudence Subcommittee.
 R.C. 5739.02.
 R.C. 5739.03.
 R.C. 5739.026.
 R.C. 5739.14.
 Ohio Adm.Code 5703-1-05.
 Ohio Adm.Code 5703-1-07.
 R.C. 5739.01(E), 5739.01(L), 5739.02(B)(42)(g), and 5739.02(B)(8).
 R.C. 5739.02(B)(8).
 R.C. 5751.02 and 5751.033.
 R.C. 5751.03.
 R.C. 5751.014.
 R.C. 5751.10.
 R.C. 5747.06 and 5747.07.
 R.C. 5747.07(H).
 104, Inc. v. Liquor Control Commission, 13 Ohio Misc. 75, 233 N.E.2d 622 (C.P. 1967); Ohio Dept. of Taxation v. Toledo Sports Enterprises, Inc., 62 Ohio Misc.2d 172, 594 N.E.2d 180 (C.P. 1991).
 Ohio Dept. of Taxation v. B/G 98 Co., LLC, 141 Ohio App.3d 678, 753 N.E.2d 214 (1st Dist. 2001).
 R.C. 1309.617.
 See B/G 98 Co., LLC, supra note 21.
 State v. Standard Oil Co., 39 Ohio St.2d 41, 313 N.E.2d 838 (1974).
 R.C. 1336.04(A)(1).
 R.C. 1336.04(A)(2); Lesick v. MedGroup Management, Inc., 1st Dist. Hamilton No. C-990097, 1999 WL 979136 (Oct. 29, 1999).
 See 11 U.S.C. § 548.
 See R.C. 1336.07.
 R.C. 1136.08(A).
 Baker & Sons Equip. Co. v. GSO Equip. Leasing, Inc., 87 Ohio App.3d 644, 622 N.E.2d 1113 (10th Dist. 1993).
 R.C. 1336.08(C)(1).
 11 U.S.C. § 548(c).
 R.C. 2735.04(D)(1).
 See 11 U.S.C. § 363.
 R.C. 319.54(G)(3).
 R.C. 319.202.
 See ORC § 319.54(G)(3)(h) and (m); Ohio Op. Atty. Gen. No. 81-016, 1981 WL 156166 (Mar. 26, 1981).
 Ohio H.B. 449.
 R.C. 4123.32(B); Ohio Adm.Code 4123-17-02(B).
 Ohio Adm.Code 4123-17-02.
 Ohio Adm.Code 4123-17-02(B)(1).
 Ohio Adm.Code 4123-17-02(B)(2).
 Ohio Adm.Code 4123-17-02(C)(1).
 Ohio Adm.Code 4123-17-02(B)(6).
 Ohio Adm.Code 4123-17-02(B)(7).
 Ohio Adm.Code 4123-17-02(B)(8).
 Ohio Adm.Code 4123-17-02(C).
 Id.; Ohio Bur. of Workers’ Comp. v. Widenmeyer Elec. Co., 72 Ohio App.3d 100, 593 N.E.2d 468 (9th Dist. 1992).
 State ex rel. RFFG, LLC v. Ohio Bur. of Workers’ Comp., 141 Ohio St.3d 331, 2014-Ohio-5199, 23 N.E.3d 1172 (2014).
 State ex rel. K&D Group, Inc. v. Buehrer, 135 Ohio St.3d 257, 2013-Ohio-734, 985 N.E.2d 1270 (2013).
 Ohio Adm.Code 4123-17-02(B)(3).
 R.C. 4141.24(F); Ohio Adm.Code 4141-17-03.
 Ohio Adm.Code 4141-17-03(A).
 R.C. 4141.24(F); Ohio Adm.Code 4141-17-02.
 R.C. 4141.24(G)(1); Ohio Adm.Code 4141-17-05.
 R.C. 4141.24(G)(2).
 Flaugher v. Cone Automatic Machine Co., 30 Ohio St.3d 60, 507 N.E.2d 331 (1987).
 Cintas Corp. v. Great Lakes Best One Tire & Service, LLC, 11th Dist. Trumbull No. 2017-T-0080, 2018 WL 3117477 (June 25, 2018).
American Bar Association, Committee on Negotiated Acquisitions, Model Asset Purchase Agreement with Commentary, Section 2.4(b), at 48-49 (2001).
 Pottschmidt v. Thomas J. Klosterman, M.D., Inc., 169 Ohio. App.3d 824, 2006-Ohio-6964, 865 N.E.2d 111 (9th Dist. 2011).
 Welco Industries, Inc. v. Applied Cos., 67 Ohio St.3d 344, 617 N.E.2d 1129 (1993).
 Pottschmidt, supra note 60.
 Welco Industries, Inc., supra note 61.
 See Cytec Industries, Inc. v. B.F. Goodrich Co., 196 F.Supp.2d 644 (S.D. Ohio 2002).
 Flaugher, supra note 57; Welco Industries, Inc., supra note 61; Pottschmidt, supra note 60.
 Flaugher, supra note 57; Welco Industries, Inc., supra note 61.
 Ray v. Alad Corp., 560 P.2d 3, 136 Cal.Rptr. 574 (Cal. 1977).
 Knitz v. Minster Machine Co., 69 Ohio St.2d 460, 432 N.E.2d 814 (1982); Carpenter v. Shape Form, Inc., 12th Dist. Madison No. CA89-07-010, 1990 WL 2336 (Jan. 16, 1990); Flaugher, supra note 57.
 Comprehensive Environmental Response, Compensation, and Liability Act of 1980, as amended, 42 U.S.C. § 9602, et seq. (1988).
 See, e.g., North Shore Gas Co. v Salomon Inc., 152 F.3d 642 (7th Cir. 1998) (overruled on separate grounds by Envision Healthcare, Inc. v. PreferredOne Ins. Co., 604 F.3d 983 (7th Cir.App. 2010).).
 See Anspec Co., Inc. v. Johnson Controls, Inc., 922 F.2d 1240 (6th Cir. 1991); City Management Corp. v. U.S. Chemical Company, Inc., 43 F.3d 244 (6th Cir. 1994).
 See Olin Corp. v. Yeargin Inc., 146 F.3d 398, 407 (6th Cir. 1998); White Consol. Industries, Inc. v. Westinghouse Elec. Corp., 179 F.3d 403 (6th Cir. 1999); Hobart Corp. v. Dayton Power & Light Co., 407 F.Supp.3d 732 (S.D. Ohio 2019).
 See, e.g., City of Management Corp., supra note 71.
 See, e.g., Cytec Industries, Inc., supra note 64.
 Cobb v. Contract Transp., Inc., 452 F.3d 543, 554 (6th Cir. 2006).
 Id. (citing EEOC v. MacMillan Bloedel Containers, Inc., 503 F.2d 1086, 1091 (6th Cir. 1974).).
 MacMillan Bloedel Containers, Inc., supra note 76, at 1094.
 Clark v. Shop24 Global, LLC, 77 F.Supp.3d 660 (S.D. Ohio 2015).
 R.C. Chapter 4111
 Clark, supra note 78, at 694 (quoting Welco Indus., Inc. v. Applied Cos., 67 Ohio St.3d 344, 347, 617 N.E.2d 1129, 1132 (1993).).
 See, e.g., Golden State Bottling Co., Inc., v. N.L.R.B., 414 U.S. 168 (1973).
 29 U.S. Code Chapter 23.
 R.C. 4141.28(C).
 Acordia of Ohio, L.L.C. v. Fishel, 133 Ohio St.3d 356, 2012-Ohio-4648, 978 N.E.2d 823 (2012).