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Escrows in California Business Sale Transactions

/in , /by Al Statz

Business “Transaction Escrows” protect the interests of buyers and sellers, and are used extensively by transaction attorneys and brokers in California. Then there is what’s called a “Holdback Escrow” which secures post-closing obligations and adjustments. This blog introduces you to both types of escrows and how they facilitate business deals.

What is a Business Transaction Escrow? 

In California, for business sale-purchase transactions of all sizes and shapes, it is common to have an escrow agent serve as a neutral holder of funds and documents, communications link and closing facilitator. The escrow agent also deals with regulatory compliance, prepares routine transaction documents and closing statements, and handles administrative details in a cost-effective manner.

Business escrow companies in California are either attorneys (acting in a neutral capacity) or they are licensed by the California Department of Corporations. Due to the specialized nature of business escrows, the number of providers is considerably smaller than those serving real estate transactions.

How it Works

Escrow starts with a written agreement between the buyer, seller and escrow holder. The escrow holder prepares written escrow instructions* that reflect the terms of the purchase agreement and all conditions of the transaction.  The buyer and seller will sign the escrow instructions, and make any necessary earnest money deposits.  The escrow holder will process the escrow in accordance with the instructions. When all conditions are met or achieved, the escrow will be “closed”. The escrow holder provides a concise accounting of all funds, and arranges for the safe delivery of all funds and documents to their proper recipients.

* When applicable, these instructions will include a Notice to Creditors of Bulk Sale. California’s Bulk Sale law is contained in Commercial Code Section 6101-6111.

The typical duties of an escrow holder in a business asset sale/purchase transaction include:

  1. Requesting publication, recording and UCC lien searches for state and county
  2. Complying with Bulk Sale statutes (publication), as applicable
  3. Notifying the county tax collector
  4. Requesting a beneficiary’s statement if debt or financial obligations are to be taken over by the Buyer
  5. Requesting demands from existing lien-holders, receiving claims
  6. Notifying and obtaining clearances from County, State and Federal agencies as required
  7. Complying with lender’s requirements, securing loan documents and receiving funds
  8. Obtaining and holding purchase funds from the buyer
  9. Prorating taxes, interest, rents, security deposits, etc., as instructed
  10. Preparing routine legal and financial documents such as notes, security agreements, personal guarantees, amortization schedules, deeds of trust, UCC-1 financing statements, bill of sale, corporate resolution authorizing the transaction, etc.
  11. Can prepare fictitious business name statements
  12. May prepare routine amendments to agreements
  13. Securing releases of all contingencies or other conditions imposed on the particular escrow
  14. Preparing estimated closing statements prior to close of escrow
  15. Consultation regarding problems that arise
  16. Preparing final closing statements for the parties, accounting for the disposition of all funds deposited in escrow
  17. Obtaining appropriate signatures on all documents
  18. Close escrow when all instructions of buyer and seller have been carried out
  19. Disbursing funds as authorized by instructions, including commissions and payoff liens
  20. Preparing and recording UCC-1, UCC-3 and deeds of trust, as needed
  21. Securing tax clearances
  22. Distributing final transaction documents to all parties

The above list is a generic set of escrow tasks in a sale of business assets. The escrow tasks performed in an actual transaction will depend on the transaction type and circumstances, and will be listed in the instructions prepared by the escrow holder. Stock sale escrows look a lot different, and are typically simpler.

The Holdback Escrow and How it Works

No. In some Merger and Acquisitions (“M&A”) transactions, the buyer and seller agree to place a portion of the purchase price in a third party escrow account for a specified period of time after closing. These funds are intended to secure payment to indemnify the buyer against losses caused by a breach of the seller’s representations, warranties or covenants; for payment of post-closing working capital or balance sheet adjustments; to guaranty payment of an earn out (where part of the purchase price is based on post-closing performance of the business), as collateral to insure the performance of some other event by the seller; or some combination of these. Holdback escrows go by other names, such as “retention escrow”, “indemnity escrow” and “holding escrow”.

Both buyers and sellers can benefit from holding back funds in escrow.  Holdback provisions should be carefully thought out and negotiated early in the M&A negotiation process. Understanding the typical approaches and common pitfalls is extremely helpful, which only comes with experience.

Holdback escrows are often completely separate from the transaction escrow. The escrow holder may be a bank, trust company, or other professional service provider. Typically, funds from the transaction escrow roll over into the holdback escrow immediately after a transaction closing. A holdback escrow requires a separate agreement between the escrow agent, buyer and seller, which includes, among other things, conditions for releasing funds and procedures for resolving any disputes. This can take some time to negotiate.

If you have questions regarding this blog post or need help selling or acquiring a California company, you can Email Al Statz or call him at 707-778-2040. And if we don’t know the answer we would be happy to direct you to someone who does!

Please don’t tell me liquidation is my best exit option!

/in , /by Jim Leonhard
While the typical premise of value in valuing an operating business for a sale/acquisition or exit planning is as a going concern, occasionally, facts and circumstances indicate that an owner would be better off liquidating his or her business.  Unfortunately, this often comes as a shock to an owner who has spent years working in and building a business with the expectation that it can be sold for enough to provide a significant nest egg for retirement.
When and why is liquidation the best course of action?
Fundamentally, liquidation is the best option for an owner-operator when the assets can be sold off or liquidated in an orderly fashion for more money than a rational, well informed buyer would likely pay for the company as an operating business. This is usually the result of the business, as structured, not being profitable enough to pay a new working owner adequate compensation for their labor and yield a reasonable return on their investment (down payment, working capital injection, and closing costs). It can also be the result of exceptionally high risk inherent in the business.
The failure of a business to afford a fair wage to the working owner is an immediate red flag.  Why is the owner willing to be under compensated?  In theory, he or she would be better off liquidating the business and working for someone else.
Sometimes a lack of profitability manifests itself as the business paying no rent or below-market rent on a facility that the business owner or his family owns.  If the business were suddenly burdened with a market rent, as would be the case for a new business owner, the business becomes much less profitable or unprofitable. The owner might be better off liquidating the business and renting the real property to another company.
An example of exceptional business risk is the inability to secure a long-term lease for a location-dependent business.  This problem is particularly acute for retail businesses whose sales can suffer dramatically from relocation, or a business with a very high investment in tenant improvements or equipment installation, such as car washes and food processing businesses.
We frequently uncover these issues and many others in our business valuation and M&A brokerage work, particularly with mature family-owned businesses. Fortunately, with sound business/exit planning, orderly liquidation can often be avoided.
For more information about preparing to sell and exiting your California-based business successfully, please contact Jim Leonhard at 916-800-2716 or jhleonhard@exitstrategiesgroup.com. 

Be Prepared!

/in , /by Don Ross
“Be Prepared” is the Boy Scout Motto that has served young individuals and their character development in over two hundred countries since 1907. It can also be an effective mantra for a business owner who will engage in marketing and selling a business.  A well prepared business owner plays a vital role on the transaction team and helps ensure maximum value to the shareholders and a smooth transition of ownership.
Critical components of “Be Prepared” for a business owner are the following:
● Sustain.  Continue to operate the business effectively.  Having made the commitment to sell, don’t allow your mind and spirit to “go on vacation”.  Maintain business as usual and meet or exceed your sales/profit projections.  Buyers want to invest in businesses that are running smoothly.
● Demote.  This may seem counter-intuitive to “Be Prepared”; however, it is important that you develop a management team that can operate efficiently in your absence.  The more replaceable you become in the daily affairs of the business, the more you eliminate buyer risk.
● Disclose.  Total transparency empowers the prospective buyer to make informed decisions, eliminates suspicion, and obviates potential “landmines” during negotiation and due diligence.
● Diversify. “One trick ponies” are difficult to market and sell.  You don’t want to be indispensable to the future success of the business, nor do you want to be overly reliant upon one or two customers or suppliers.  Buyers will perceive less risk when they see a well-diversified portfolio of customers and suppliers.
● Coordinate.  Your transaction team can include a business broker, accountant, attorney and escrow officer.  Work closely with them.  Make yourself available and responsive to their requests.
● Update. Current monthly financials and any significant changes in the business must be updated and forwarded to your business broker.  Remember that during marketing and negotiations, your business continues to be dynamic:  it can’t stop.  Buyers attribute greater value to a business that can provide timely, accurate reports.
● Improve and Maintain. A freshly detailed and serviced car is generally easier to market and sell.  Examine the physical attributes of your business.  Put a “fresh coat of paint” on the business: repair and replace furniture, fixtures and equipment that are integral to the business and remove those items that are inoperative or unproductive.
● Organize.  Among the intangible assets of your business that bring added value and goodwill are your company’s records.  Employment records, supplier lists, customer lists, procedural documentation, handbooks, contracts, licenses and permits, et al, should be organized and updated.  It is reasonable for a buyer to expect company records to be current, accurate and complete before the change of ownership.
To paraphrase a popular quote, “An ounce of preparation is worth a pound of cure”.  You don’t climb a mountain by starting at the top . . . you prepare, plan and perform and hopefully enjoy the trek along the way.
 
Don Ross is a business broker with Exit Strategies. He can be reached at donross@exitstrategiesgroup.com or 707-778-0210.

The ESOP Solution

/in , /by Al Statz
We are often asked about Employee Stock Ownership Plans (ESOPs) as an exit strategy. For business owners who are curious about the ESOP exit option, here are links to two recent articles that discuss ESOP basics and some of the pro’s and cons of ESOPs. Both articles are from recent issues of MERGERS & ACQUISITIONS magazine, which is published in partnership with the Association for Corporate Growth, in which I am a member.
Recaps Turn to ESOPs
ESOPs have not been a big part of the M&A discussion for many years, but a confluence of recent factors is changing that.
More sellers are turning to the ESOP as an alternative to a traditional M&A transaction, as baby boomers look to sell their businesses, tax rates continue to increase and bankers become more comfortable with the ESOP option. Also, private equity firms are more frequently willing to invest alongside an ESOP transaction, as they look for ways to  differentiate themselves while buying into high-quality companies.
ESOP Candidates Consider Strategic Buyers
Executing Employee Stock Ownership Plans (ESOPs) may become more difficult because in the current marketplace, sellers can often achieve higher multiples by selling to a strategic buyer.
“I think an ESOP works for the most altruistic of sellers,” says Robert Brown, co-founder and managing director of Chicago investment bank Lincoln International.
“The multiple that an ESOP is able to pay is typically lower than a strategic buyer,” says Jason Bolt, senior associate at Columbia Financial Advisors, which provides business valuation and other financial advisory services.

Is Your Business Prepared for Sale?

/in /by Jim Leonhard
Serious potential consequences await owners who neglect to prepare their business, and themselves, for a future sale or transfer. Here are ten exit planning mistakes to avoid:
  1. The business experiences a sudden, catastrophic loss and all of the owner’s financial eggs are in the business.
  2. A perfect buyer suddenly appears and makes a fantastic offer, but the owner cannot consummate the sale due to prohibitive (and avoidable, with planning) tax cost and a lack of sufficient independent retirement income.
  3. An agreement to sell is made with a qualified buyer, but the buyer reduces the offer after finding aged accounts receivable and owner loans on the books.  In short, the company’s books were not in order.
  4. An unanticipated catastrophe hits the business and because the owner failed to have a contingency plan in place, or existing support from legal/financial advisers, the business cannot survive.
  5. The sole owner dies or becomes permanently disabled, without sufficient (or no) life or disability insurance, no business succession plan, and no estate plan.
  6. One of the partners dies or the partners have an irreconcilable falling out and there is no clear buy-sell agreement – either of these situations commonly result in expensive litigation, and value erosion.
  7. The business is struck by a huge, legitimate legal claim with insufficient liability insurance in place thereby irrecoverably impacting the enterprise value and marketability.
  8. One of the company’s key employees quits, taking the best customers and other employees with him because the company has no non-compete agreement or retention plan to prevent this from happening.
  9. The owner wishes to retire and sell the business to a family member but there is insufficient time to make the transfer and pay minimal taxes.
  10. The owner has selected a capable non-family heir apparent, but has no written succession plan in place and the heir apparent cannot realistically fund the transfer.
All of these mistakes can be avoided with a well thought out exit plan developed in advance of a sale and updated frequently.
For more information about preparing to sell and exiting your California-based business successfully, please contact Jim Leonhard at 916-800-2716 or jhleonhard@exitstrategiesgroup.com. 

Ten Commandments of a Successful Exit

/in , /by Al Statz
The average person doesn’t realize that selling a company is often the most gut-wrenching transaction of a business owner’s life. They’ve just spent their life building the business, it’s their largest asset, and they have no training or experience in selling a business. With that as a backdrop, here are ten practical directives that will help you make better exit strategy decisions and achieve a more successful sale.
1. I shall plan ahead
Why sell? This business may be your life’s work. If you sell, what will you do next? Is your family on board? What type of lifestyle do you want and what will your expenses be? What is the most probable selling price of your business and what are your likely sale proceeds after taxes? Is that enough to fund the next chapter of your life? How will you reinvest the proceeds? The point here is to have your personal needs, goals and plans in focus before you make the final decision to go to market.
2. I shall not depend on miracles
In the privately-held business marketplace, sellers expect full value and buyers require a reasonable return on investment. It’s win-win or no deal. According to the 2014 Pepperdine Private Capital Markets Survey, the number one reason business sale transactions don’t happen is a gap in value expectations. Over-valuing your business leads to mistakes in judgment and poor decisions. So does undervaluing it. Usually there is a market-based price range for similar businesses with comparable financial performance and risk characteristics. A skilled M&A broker can often move price up in the range, but expecting a lot more usually leads to no deal. Before you go to market, spend some time and money with a qualified and objective M&A brokerage professional to assess the market value of your business.
3. I shall prepare my business
A seasoned M&A broker can also objectively evaluate your business from marketability, transferability, finance-ability and deal survivability perspectives. Then take that professional feedback to heart and address the weaknesses. Every business is unique, but here are a few common preparation initiatives:  Have financials reviewed to reduce a buyer’s perception of risk. Embark on a program to diversify the customer base (if concentrated). Delegate more to make yourself less critical to the operation. Put incentives in place to retain key employees who can facilitate a smooth transition. Legally protect intellectual property. Capture growth opportunities in a written business plan with realistic financial projections. Buyers will have their own plans, but this helps them perceive greater value. Think of exit strategy as business strategy with a specific purpose.
4. I shall not wait for perfect timing
It makes sense that the best time to maximize selling price is when business, industry, economic and capital market conditions are strong. Yet, letting go is hard to do when things are good. Don’t make the mistake of waiting too long to make your move. In my experience, owners have a tendency to hold on longer than they should. I could easily cite dozens of examples where an owner held on too long, the business lost its competitive edge, sales and earnings slid, and enterprise value declined severely. Deciding when to go to market requires uncommon objectivity, faith, and courage.
Also keep in mind that the selling process takes 9 months on average. Add time on the front end for go-to-market preparation, and add time on the back end for management transition. Call us if you’re interested in understanding likely time-frames for preparation and transition for your particular circumstances.
5. I shall help buyers buy
I know it sounds simple, yet many owners think playing hard to get and withholding information is the answer. To maximize value, businesses need to be presented with clear, supportable facts. In successful deals, a professional Confidential Information Memorandum (aka “deal book”) is presented to prospective buyers who have signed a confidentiality agreement. A fact-based CIM communicates the essential information that serious buyers need to get a firm grasp on your business, be confident in its prospects, and make solid purchase offers. A CIM presents information in the language of experienced buyers and professional buy-side advisers.
In many years of looking, I have yet to see the perfect business. A significant weakness or risk revealed early in the discovery phase is usually a manageable hurdle or a point to negotiate around, and always a big time saver. That same information revealed during negotiations or later on in due diligence becomes a catalyst for buyers to reexamine every piece of data, lower projections or increase their required rate of return (lower their price), or walk away. Also, appropriately exposing your company’s warts early in the process builds trust and credibility with buyers, which becomes an advantage in negotiations, and helps ensure that you keep your proceeds after the sale.
6. I shall have buyers competing to buy
It can be difficult to achieve full value with just one buyer at the negotiating table. When someone inquires about acquiring a business that is not for sale, that limits the negotiation to one party. Most of these inquirers don’t buy; and when one does, their purchase price is usually lower than what can be achieved in a structured M&A sale process. When an owner decides to exit, it is not uncommon for them to confide in their CPA, attorney or financial advisor. That advisor may mention, “I know a potential buyer, why don’t I introduce you?” This also leads to a negotiation of one. Buyers love exclusivity. This may not be in your best interest if your objective is to maximize selling price. Price is generally maximized in a limited auction process.
7. I shall keep my eye on the ball and my lips sealed
Some owners make the mistake of becoming distracted with selling instead of running their business, resulting in significant value erosion. When sales or earnings slide – so does selling price. There simply isn’t enough time in the day to run a business at peak performance and perform the job of selling it. Do what you do best and hire an M&A professional to run a confidential structured sale process.
Also, it is nearly impossible to maintain confidentiality when an owner attempts to sell on his own. Colleagues gossip. Word spreads fast. Employees may leave and customers may go elsewhere. Bankers and suppliers get nervous. Competitors take advantage. Then the business suffers and goodwill value declines. A competent M&A broker uses systems and procedures to maintain confidentiality and release sensitive information at appropriate times.
8. I shall not do surgery on myself
Selling a business is something you need to do right the first time. For many reasons, you improve your odds of maximizing and holding on to your sale proceeds when you engage an M&A brokerage professional that specializes in selling businesses. Here we can take a lesson from public companies and private equity groups, who wouldn’t consider a sale or divestiture without engaging an investment bank. Why? Better results, and less risk of failure. Engage a professional M&A broker to tip the experience scale in your favor, and manage the entire process for you.
9. I shall use experienced professionals
Your transition team must know the specialized business, legal and tax issues of business transactions, and they must match up against the experience level of a buyer’s advisers. Price is important, but your real goal is to maximize after-tax proceeds. Deal structures that favor you for taxes are often unfavorable to the buyer and vice versa. Are you confident in your tax adviser to help you plan for Uncle Sam, the unwanted stakeholder in any deal? Do you have an experienced transaction attorney who you can trust to negotiate post transaction risks in a commercially reasonable manner? Your end results will be better when you use qualified and seasoned professionals from the very beginning.
10. I shall not let time kill my deal
Time is one of the biggest deal killers, often when due diligence bogs down. Buyer and seller principals are busy running their businesses; attorneys, CPAs and other deal participants can also get distracted. One of the roles of an M&A broker is to establish timelines, keep the deal teams on track, and maintain deal momentum; and not let deal fatigue set in.
During the selling process, never lose sight of why you are selling, whether it is to go fly fishing, travel the world, provide financial security for family members, make charitable contributions, or some other larger purpose. It’s important to keep your big picture future in focus as you encounter the challenges and ride the emotional roller coaster of selling a business. We get it, and we’ll be with you all the way.
 
If you have questions or want a more complete understanding of any of the above directives, or to schedule a confidential consultation about selling, merging or acquiring a California business, Email Al Statz or call him at (707)778-2040.

Selling a Business Using a CRT

/in , /by Al Statz
When a business owner decides to sell or transfer ownership, the owner often thinks about achieving the following three post-transaction objectives:
1) being financially independent,
2) taking care of family members, and
3) possibly a donation to a favorite charity.
All three of these objectives can sometimes be met by setting up a Charitable Remainder Trust (CRT) – the subject of a recent article by my friend and colleague Darrell V. Arne, CPA, ASA, CM&AA covering basic CRT concepts and the mechanics involved in using a CRT in a business sale transaction.
CRT Overview
The basic concept of a CRT is that highly appreciated property (e.g. stock in a closely-held company) is donated to a Trust – naming one or more charities as the ultimate beneficiary (remainderman).
Because of the tax-exempt nature of a charitable Trust, when the CRT sells the closely-held stock, no immediate capital gains taxes are paid at the time of sale. Therefore, the trustee of the Trust has more cash proceeds to re-invest in income producing assets for the benefit of the income beneficiaries.
The former selling shareholder and spouse (Donors) become lifetime income beneficiaries of the Trust. The Donors also obtain an immediate charitable deduction (up to 30% of adjusted gross income) at the time of transfer, since the remaining Trust assets are passed to a charity upon the death of the last income beneficiary. Also, assets transferred to the charity do not subject the Donors to estate taxes.

What is an Earn-out?

/in , /by Al Statz

An earn-out is when part of the consideration received for a business is based on future sales or earnings. Earn-outs usually come in to play in business acquisitions when a business has high risk factors, or when non-linear growth is reasonably expected, or when there is a significant gap in the price expectations between the buyer and seller. In all cases the parties share the risk and reward of future performance.

Bridging a Price Gap

An earnout is often the best way to bridge a gap between what a seller will accept and what a buyer will pay. For example,  a seller may think their company is worth $4 million and the buyer thinks it’s worth $3 million. They can agree on a guaranteed price of $3 million, plus an earn-out over a period of 1-2 years, structured to provide the seller with the potential of receiving the extra $1 million, or more if sales or earnings reach a certain level, based on an agreed upon formula.

Devil in the Details

While simple in concept, earn-outs can become contentious during the measurement and payout phase. It is critical that earn-out parameters be carefully thought out and clearly defined in the purchase agreement. There must be no ambiguity in the accounting practices to be used, for example. Even if you continue to manage the business during the earn-out period, don’t assume anything.

At the same time, remember the K.I.S.S. principle. In my experience, the more complicated an earnout gets, the more likely negotiations will fail.  It is usually (though certainly not always) best to base earn-out calculations on top-line sales or gross profit, not net income. Also, be sure to design the earnout formula to completely align the interests of the parties.

For another perspective on the use of earnouts in M&A transactions, see this recent article on Axial Forum.

For more information on M&A transaction structuring strategies, or if you want help selling a business or developing a winning exit strategy, contact me at 707-778-2040 or alstatz@exitstrategiesgroup.com.

Private Equity Fact and Fiction

/in , /by Al Statz

Private equity groups are active acquirers of closely-held lower middle market companies here in California. Private equity consists of individuals, families and institutional investors that make passive minority investments in partnerships that invest in, provide debt financing for, and operate private companies.

Republican presidential candidate Mitt Romney’s run for the presidency in 2012 brought sudden attention to the private equity world. Romney, who had been the founder and CEO of private equity firm Bain Capital, didn’t go far out of his way to defend the industry during the election, and this growing and increasingly important source of private capital continues to capture news headlines. Business owners may find it challenging to distinguish facts from fiction.

This article, by advocacy group “The Private Equity Growth Capital Council”, attempts to dispel some of the myths of private equity. Enjoy!

Is it Better to Own or Lease your Business Facility?

/in , /by Bob Altieri

For some businesses, specialized building construction is required — hotels, car washes, wineries, some food processing facilities, etc. — making the business and real estate nearly inseparable, and making owning the real estate almost mandatory. However most enterprises need a more generic commercial, industrial or retail property to support business operations, and the decision to own or lease real property is more elective.

Companies that lease their facilities avoid the sizable cash investment associated with ownership. Because a landlord seeks to receive an adequate return on invested capital (debt and equity) the lessee is likely paying a higher rent than just the debt service on a real property investment. But there are numerous financial issues beyond return on investment to consider.   These include the appreciation potential of the facility, how financing the facility will impact financial leverage, tax consequences and even longevity of the business itself.

Looking on the plus side of leasing from a business perspective, growing firms may be wise to invest exclusively in inventory and other working capital assets. In fact, rapidly growing companies may not be able to invest in physical facilities even if they wanted to. Similarly many firms desire the flexibility that leasing provides in terms of expansion potential and having the ability to change locations as market conditions change.

On the plus side of ownership, many firms prefer the control (of rent increases, location, specialized improvements, maintenance, being asked to leave at the expiration of the lease, reducing risk in a sale of the company, etc.) that is only provided through facility ownership. I have seen businesses devastated by losing their location prematurely resulting from landlord actions. In addition, as the mortgage is paid down, an owned facility represents a potential source of collateral in the face of financial challenges to the business. If you determine that your business has long-term viability, cash to invest and will not outgrow the facility; when you sell the company down the road, your lease to the buyer can provide retirement income, especially when the mortgage has been paid down substantially.

Generally, for small to mid-size private companies, real estate is held outside the company, in an entity owned by the same or similar group of shareholders.  The holding entity purchases the real property and leases it to the operating company. Most holding companies are organized as an S-Corporation or LLC with pass-through tax treatment. The facility owner(s) enjoy the tax advantages of depreciation, avoid double taxation, and can reap the benefits of any long-term appreciation of the real property. If the rent is market-based, as it would be in an arm’s-length relationship, which it must be to avoid IRS scrutiny, the valuation impact on the operating company is non-existent.

If you are faced with the choice of owning or leasing real estate, keep in mind it may be difficult to predict the long term future of the enterprise. Understand that your eventual exit from the business could be helped or hindered by owning the real estate. Your best buyer may be a synergistic buyer that already has a facility and would consolidate facilities, leaving you with an empty building to sell or lease.

I’ve really just scratched the surface of this topic. I’m leaving many considerations untouched. There is no single answer to my initial question. Your choice to own or lease should be based on your unique business model, circumstances and objectives, and should be carefully thought out. This can be a complex business question that deserves professional M&A, banking, tax and legal guidance in order to make a final determination.

For advice on selling, acquiring of valuing a California business with or without real property, Email Bob Altieri or call him at 916-905-5706.