If you’ve decided to sell your business, you’ll need to prepare a Sales Agreement, the core document for selling business assets and/or company stock. It defines everything in the business that you intend to sell – assets, customer lists, intellectual property, and goodwill. After you’ve written up the document, reread it, edit it, and make sure it’s accurate and addresses all purchase terms and components, including:
- Seller, buyer, and business names
- Background information
- Purchase price, assets being sold (including a complete list of inventory), and how those assets will be allocated
- Financial statements (usually as attachments)
- Non-compete covenant
- Terms of agreement and payment terms
- Seller and buyer representation and warranties
- Access to business information
- Date of closing, and how the business will be run in advance of that date
- Contingencies
- Fees (including broker fees)
Other issues to address may include:
- Reducing the company’s dependence on you
- Upgrading the skills of your successors
- Proving to the buyer that the business will run profitably without you
- Implementing a retention plan for key employees and customers, such as placing key players under contract
