The Eight Step Selling
Process - Part I
From The Offer Stage Through The Close Of
Escrow Stage
We thought it be helpful
to discuss the various stages of the selling process
as eventually most of you will be selling your
business some day. In this edition we will cover
the following topics:
1) receiving the
offer,
2) responding to the offer,
3) acceptance of the offer, and
4) removal of contingencies.
1. Receiving the Offer
– Once a business has been listed and marketed and a
buyer is interested in acquiring the business we
will write up an Asset Purchase Agreement Contract
which the buyer will sign to be accompanied with an
initial deposit check.. The Asset Purchase Contract
spells out the terms and conditions of the sale and
contains an expiration date.
2.
Responding to the Offer
- Upon receipt of the offer the seller has three
options: 1) he can accept the offer by signing the
contract, 2) he can write a counter offer changing
the terms of the offer or 3) he can reject the offer
by not responding to the offer. Once the seller
receives the offer he will have a designated time
spelled out in the contract to respond. If he
doesn’t respond in the designated time the offer
will terminate and any subsequent response will be
considered a counter offer.
3.
Acceptance of the Offer
– Once the offer has been accepted by the seller the
broker deposits the initial deposit check into
escrow and the buyer has normally ten days or more
to remove the contingencies described below.
4.
Removal of Contingencies
– Conditions need to be satisfied by the buyer
before he increases his deposit to normally ten
percent of the sales price and the actual escrow
process begins. The standard contingencies include
the following: 1) review of the businesses books
and records, 2) physical inspection of the premises
and 3) the landlords approval of assignment of the
existing lease, modifying the existing lease or
negotiating a new lease with the buyer. In some
cases the transfer of special licenses such as ABC
(Department of Alcoholic Beverage Control) license,
entertainment license or approval of the franchisor
(if a franchise) are required as additional
contingencies. In some cases there may be a
financing contingency where the buyer has a certain
time to acquire necessary third party financing.
In our next edition we
will cover the remaining steps necessary to close
escrow which include: 1) the escrow process, 2)
obtaining licenses and setting up tax accounts, etc,
3) transferring licenses, 4) taking inventory and 5)
closing escrow. We will be happy to review the
above process in greater depth with any one so
please call us for further details on the eight step
selling process.
Restaurateurs of the Quarter -
Mary’s Pizza Shack - A Family Affair
We
recently sold Marioni’s on Sonoma Square in Sonoma
to Mary’s Pizza Shack. The company was founded by
Mary Fazio in 1959 and her grandchildren currently
run the business and have continued the same
original recipes, traditions, quality food and
passion. Mary’s Pizza Shack provides homemade
Italian food at reasonable prices, From one single
“shack”, Mary’s has grown to 15 full service casual
Italian restaurants in Sonoma, Napa, Marin, Solano
and Contra Costa counties.
Cooking
homemade Italian food is a rich part of their family
history. It all began with the recipes their
grandmother Mary Fazio served in the “shack”. Mary
Fazio was born in New York City to immigrants of
Ischia, Italy, a small island just west of Naples.
In 1959, Mary took her own pots and pans from home,
$700 savings and a passion for great Italian food to
start Mary’s Pizza Shack and the restaurant became
in instant success.
“I love my
customers,” she would say. “I want to care of them.
I guess I just love people.” Mary proved that
everywhere she went. At grocery stores and local
shops, she was notorious for scribbling her
signature on a napkin for locals and friends, valid
for a free pizza.
The
company is currently run by third generation family
members including Cullie Williamson- President &
CEO, Vince Albano-VP Restaurant Develop, Bruce
Lane-IT Director, Vince Dito-F & B Director, Nanette
Albano Lane-Design, and Marie Albano Dito –
Contributions. We wish Mary’s family continued
success in carrying on the family tradition for many
more generations to come.
