1) |
Locate a business for sale of interest |
| 2) |
Review available information. Typically you sign a Confidentiality Agreement with the listing agent who will provide financials and an equipment list.
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| 3) | View the business and meet owner. |
| 4) | Craft Offer to Purchase (a broker can assist you in this process). The offer to purchase defines the following: |
| |
| a. | Business information |
| b. | Vendor information |
| c. | Purchaser information |
| d. | Offer Amount including source breakdown and allocation |
| e. | Closing date (date keys of business to be transferred) |
| f. | Standard purchasing conditions |
| g. | Purchaser’s additional conditions |
| h. | Purchaser conditions removal date |
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| 5) | Provide 10% deposit cheque made out to the listing agent's brokerage. Once an offer is accepted then the cheque is deposited into brokerage's trust account and is 100% refundable until such time all purchaser conditions are removed by the purchaser at which time the deal becomes unconditional. |
| 6) | The offer is presented to the vendor by the listing agent. The vendor will then accept, decline or counter the offer. |
| 7) | Once accepted by the vendor and signed by all parties and accompanied by defined schedules the Offer to Purchase becomes the Purchasing Contract. |
| 8) | Purchaser performs due diligence. This includes all up front work to be done in order to make the purchasing contract unconditional. Standard conditions would be satisfactory verification of sales/revenue, satisfactory lease arrangements, satisfactory appraisal of assets, and review of
contracts and business licenses. Some other conditions would be franchise approval, liquor license, gaming license. |
| 9) | Purchaser removes conditions on or before date agreed to in Purchasing Contract or the deal becomes void and the purchaser’s deposit is returned in full to the purchaser by the listing agent. |
| 10) | Inventory is taken at close of business the day before the closing date and any adjustments are forwarded to vendor’s lawyer. |
| 11) | On the Closing Date the keys are transferred and possession is taken. Vendor begins training purchaser as specified in the purchasing contract. |
| 13) | Purchaser’s lawyer ensures all commitments are met and forward funds to close to the vendor's lawyer. |
| 12) | Vendor’s lawyer prepares Bill of Sale and collects and disperses funds. |
