The following is a step-by-step summary of the typical business sales process:

1.        Initial seller meetings are conducted by the seller's broker (a professionally trained business broker, holding a Real Estate license where necessary) and the seller is educated on the process of selling a business.

2.        A Representation Agreement is filled out by the seller's broker & signed by the seller. Immediately after signing the Representation Agreement, the Seller provides the Broker the following:

a.        Complete lists of all equipment and other assets to be included or excluded in the sale;

b.        Profit and loss statements, balance sheets, and tax returns of the business covering the last three years;

c.        The most recent interim profit and loss statement, balance sheet, and sales tax returns;

d.       Real and personal property leases;

e.        Copies of all patents, licensees, loan documents, contracts or agreements;

f.         All agreements relating to employee benefits;

g.       Any environmental reports; and

h.       Copies of all other documents needed to present a fair and accurate description of the business to prospective buyers.

3.        During the representation period, the seller must update each document when any material change has occurred. Seller consents to broker publishing, advertising or distributing information about the business to prospective purchasers and to cooperating brokers as well as to contacting landlords and any others regarding any of the information about the business.

4.        Seller's broker writes a narrative on the business. The Representation Agreement is entered into the Liberty Business Advisors proprietary database, and a Business Profile is created. Seller's broker introduces the Business to all of our other brokers during weekly office meetings.

5.        All other brokers match the Seller's Business Data (SBD) against buyers in their respective queues (Buyers who have previously been interviewed, signed a Confidentiality Agreement and filled out a detailed Buyer's Profile). Seller's broker plans an advertising strategy and the SBD is added to web sites in such a manner so the general public cannot identify the business.

6.        Buyers in queue and buyers who have responded from the advertisements will have their backgrounds and finances evaluated to determine if they are qualified buyers. If qualified buyers are interested, they will be shown a Business Profile. If further interest is shown, the seller's broker will arrange a meeting with the seller.

7.        If a buyer wants to make an offer at a fair price, the buyer's broker will write the offer and secure a deposit.

8.        The seller's broker will present all offers to the seller.

9.        Seller and seller's broker will review each offer and decide whether to accept it or counter the offer. If seller wants to counter, s/he can:

a.        Mark up the original offer, initial the changes and sign the offer.

b.        Sign the offer; check the counter offer box on the offer and write-up a counteroffer.

c.        Re-write the offer.

10.     Once an offer is accepted, the seller's broker will arrange a seller/buyer meeting where the seller's and buyer's Disclosure Statement is discussed, questions are answered and the statement is signed by both parties.

11.     Due diligence starts once an offer is accepted and the seller's and buyer's Disclosure Statement is completed.

a.        If the due diligence proves the business to be as represented, the buyer signs the Conditions Removal.

b.        If the due diligence does not prove the business to be as represented, either the offer can be renegotiated or the offer will be cancelled and the buyer's deposit check will be returned.

c.        If the due diligence proves the buyer to be as represented (capable of managing the seller's business, financially capable and with good credit), the seller signs the Conditions Removal.

d.       If the due diligence does not prove the buyer to be as represented, then the offer will be cancelled and the buyer's deposit check will be returned.

e.        Once both the buyer's and seller's Conditions Removals are signed, the seller's broker will prepare to close the transaction.

12.     Seller's broker secures, answers and/or provides the following to ensure a timely close:

a.        Copy of the Representation Agreement

b.        Copy of the Purchase Agreement and Counteroffers

c.        Copy of both Conditions Removals

d.       Seller(s) name, address (other than business address), Social Security number, sales tax number, and federal tax identification number if a corporation.

e.        Buyer(s) name, address (other than Business address), Social Security Number, and federal tax identification number if a corporation.

f.         Secures the deposit check from buyer.

g.       Secures leases - amount of monthly rental, security deposit, assignment, new lease, etc.

h.       Estimates closing date, date of possession by buyer and pro-ration date.

i.         Investigates insurance. Will buyer assume seller's or acquire new insurance?

j.         Taxes - Requests the seller's property tax bill for pro-ration.

k.        Investigates required licenses. Are they transferable?

l.         If buyer and/or seller are a corporation - need names of the officer(s) authorized to sign a Corporate Resolution authorizing the sale of the assets or stock.

13.     How will purchase price be allocated?

a.        Good will

b.        Fixtures and equipment

c.        Leasehold improvements

d.       Covenant not to compete

e.        Licenses where applicable

f.         Furniture, Fixtures & Equipment

g.       Inventory

14.     Asset sale through an escrow company.

a.        Receives opening escrow instructions.

b.        Prepares escrow instructions.

c.        Obtains signatures and deposit money - no escrow processing will start until the deposit check clears.

d.       Orders publication, recording and notifies county tax collector.

e.        Orders UCC, tax liens & judgment search for state and county.

f.         Requests demands from existing lien-holders.

g.       Receives claims.

h.       Prior to the legal published closing date, does estimation of closing costs including estimated inventory and requests funds to close escrow from the buyer.

i.         Prepares closing instructions one day prior to close of escrow.

j.         Obtains signatures on the closing instruction on the date of close of escrow.

k.        Disburses funds and paper work.

15.     Stock sale through either an escrow company, the selling Broker or a "neutral" attorney.

1.        Orders UCC, Tax Liens & Judgment Search for State and County

2.        Arranges for signature changes on banking accounts, name changes on liability accounts and preparation of new stock certificates.

3.        Prior to the closing date, does estimation of closing cost including estimated inventory and requests funds to close from the Buyer

4.        Obtains signatures on the closing instruction on the date of close

5.        Disburses money, stock certificates and paper work.

16.     Tax releases required before the seller can receive all of their proceeds, including a Certificate of Payment of Sales and Use Tax from State Board of Equalization.

Seller's whole or partial net proceeds will not be released until above Certificates are received by escrow holder.