Monday, September 5, 2005

This is a page from my book, “How I Sold My Business: A Personal Diary”

I made my sales offer to the Company through the Class A partners after hours today. I increased my "sell offer" back to $14,000 per "share", again with my motivation being to make sure the Company rejects it. Since the "Company" is Jack and David in this context, I thought this price was more than high enough to cause Jack to reject it.

I was correct in that assessment. I could barely get through all the details of the sales offer, including the $14,000 per share price, my offer to stay until April 30th of next year, a salary of $100K per year until I left, and a willingness to help in most transition matters, with the exception of working with Jack. Just as I was saying there was one caveat to my offer, which was that I wanted to talk to my tax attorney this week about the actual buyout/payment terms, I was interrupted.

The good news here is that Jack seemed relatively calm, and just said flat-out that he wanted approve of this while acting in the capacity of the company. I asked David if he wanted to discuss this with Jack in private, and he said no.

I half-heartedly tried to talk them into the deal, telling them that we still needed to hire a company attorney, but that I thought after the purchase the remaining shares would be evenly split between the Class A partners (and possibly the Class B partners), and that was a good deal for everyone, with no money out of their pockets, here's how the payments might work, etc.

Before the meeting I really thought I'd need to leave the room, and that they might want to take a few days to think about this, but to my surprise, I never left the room, and the matter was resolved right then and there. I asked them to sign one copy of my offer on the line stating that as the remaining Class A partners they were rejecting the offer on behalf of the company.

Normally we'd file something like this in the "Company" folder in the locked file cabinet, but in this case the partners decided they didn't want this document in the office. So I made a copy for myself, and one for their records, which Jack said he would keep at his home.

Before the meeting ended I told them I would be following up with the same offer to them as Class A partners very soon. I told them I couldn't get it all done today, but I might do it tomorrow, but since I was scheduled to meet with my tax attorney on Wednesday, I would probably wait until then. I reminded them that at that point, they could make up their minds individually, with either or both of them accepting my offer to sell personally.

I also reminded them that as a company we had to find a new company attorney. Normally this is something I would do myself, but David actually stepped in and suggested he should do this, perhaps with George and Cooper. He said George and Cooper would know about everything soon enough, and given the tension between Jack and I, perhaps they could try to find someone.

I asked them to come up with three alternatives they liked, and then we'd choose one from that pool. I didn't have to do this at all, but I was trying to keep some peace in the group. I gave them the names of the two attorneys I just hired and told them they were off limits, but they could check around with anyone else they wanted. I didn't give them the names of the other two attorneys I had talked to; I debated about this briefly, but I didn't want to influence them.

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