What you need to know about buying a business
Interview: Initial Phone Call – You make an initial phone call to Gibson and Associates, Inc. inquiring about purchasing a business. During this call, a time is arranged for you to come to our office and speak personally with one of our associates.
Background Information: You provide GAI with personal background information including a personal financial statement and resume. This information will be maintained in strict confidence. We preview various types of businesses, selecting from the fields that fit your experience and interests, and that are affordable to you.
Non-Disclosure: You sign an agreement to maintain absolute confidentiality regarding any information GAI shares with you regarding the businesses. The signing of the non-disclosure agreement does not entitle you to any obligation regarding the business you are attempting to purchase. The agreement merely provides that, if the business chooses to provide you with any information, then you are required by law to keep it confidential and not disclose that information to any other person.
Meetings and Site Visits: GAI will set up an appointment for you to meet the owner of the business (the Seller). At this time you may ask the Seller specific questions you have about the business. This appointment is usually scheduled for after business hours or initially away from the business. The first meeting may or may not include a tour of the business.
Offer: Writing the Offer – With our assistance, you will submit an offer to purchase and an Earnest Money deposit. Unless waived by you, this offer will be contingent upon certain items including: your inspection of the business’s financial records, condition of equipment, obtaining financing, lease arrangements, etc. This offer is not binding until all contingencies are removed in writing by you. Prior to signing the Purchase Agreement you may wish to have it prepared and reviewed by your attorney.
Presentation: GAI will present your offer to the Seller. We give the Seller background information about you and your previous experience. The Seller will either accept, reject, or counter your offer. GAI will notify you of the Seller’s response. At this point, you may either accept, reject or counter the Seller’s offer.
Mutual Acceptance: When both parties agree to all the terms and conditions of the sale and sign all amendments and counteroffers, the offer then becomes a contract. (At this point there may be contingencies or conditions that still need to be satisfied prior to closing.) Your Earnest Money will be deposited in an escrow account with the closing attorney.
Escrow and Closing: Closing Attorney – An experienced closing attorney acceptable to both parties will be selected, and GAI will provide the closing attorney with copies of all documents related to the sale.
Inspection & Due Diligence: You and your accountant, if desired, meet with the Seller and inspect the financial records of the business usually off site of the business. You will also inspect the equipment, fixtures, etc., to satisfy yourself of their condition prior to closing.
Lease: Arrangements are made with the Lesser regarding assignment of existing leased premises or drafting a new lease effective at closing.
Contingency Removal: As you work your way though the process, existing contingencies in the Purchase Agreement are removed. Once all the contingencies are removed it becomes a binding agreement and the closing date is set to sign the closing documents at the escrow attorney’s office.
Inventory: Arrangements are made for you and the Seller to take inventory, as it applies to validating the inventory numbers or proving additional re-numeration to the seller.
The Closing: Prior to closing, all parties receive draft-closing documents for review. On closing day, all parties meet at the appointed attorney’s office and the documents are signed.
Now training and transition begins!!