The Process of Selling Your Business, Page 5

Sale Documents

Once all other contingencies have been removed, your attorney will draft the sale documents necessary to complete the transaction, and the purchaser's attorney will review and approve or make changes. It is important that both parties are represented by legal counsel. Contracts executed in a typical business sale carry significant default implications for both parties. Sale documents prepared may include a Sale Agreement, a Bill of Sale, a Non-Compete Agreement, a Security Agreement, and Personal Guarantees.

Escrow

Closing (the completion of the sale), often takes place at an escrow office or other location neutral to both parties. A business escrow service will prepare closing statements, calculate and disperse pro-rated expenses and revenues, perform the searches necessary to convey clear title to property, file liens on behalf of the seller, and coordinate the execution of sale documents and the collection and disbursement of sale proceeds. Escrow fees are typically split between the Purchaser and Seller equally.