A stock sale is a business sale structured as the buyer purchasing ownership shares of the company itself, taking over the entity along with its existing contracts, licenses and liabilities, known and unknown. It is less common for small businesses, since buyers generally prefer the liability protection of an asset sale, but it can matter when contracts or licenses are not easily transferred.
Why it matters
A stock sale can move liabilities you did not know about onto the buyer, which is exactly why buyers tend to avoid it.
General information, not legal or tax advice.