- Agency
- The county tax collector, the county recorder and a local newspaper, with an escrow company usually handling the mechanics
- Form or filing
- A written notice of bulk sale, delivered to the county tax collector, recorded with the county recorder and published
- Timing
- At least twelve business days before the sale date, so build it into your closing calendar
Common snag: Assuming the buyer's attorney will handle it. If notice is skipped, the buyer may take on the seller's unpaid debts and taxes, and that can come back as a price fight.
What a Bulk Sale Is
California's bulk sale law covers a sale of most of the inventory or assets of a business whose main activity is selling goods from stock. Restaurants and bars fall into that group, as do many retailers.
Whether your sale qualifies can depend on size, type of business and how the deal is structured, so ask your attorney early.
Who Gives Notice and When
The buyer generally gives notice, and it must go out at least twelve business days before the sale date. Escrow companies usually handle this, which is one more reason to open escrow early.
Where the Notice Goes
Notice is generally delivered to the county tax collector where the assets are, recorded with the county recorder and published in a local newspaper of general circulation. In the Stockton area that means San Joaquin County offices.
The notice names the seller and buyer, describes the assets and gives the planned sale date and place.
Why It Matters
A buyer who skips notice may become liable for unpaid taxes and debts of the seller. The sale itself usually stays valid, so the fallout lands in the price, an escrow holdback or a dispute after closing.
Links to Other Steps
Bulk sale notice often runs alongside sales tax clearance and, for bars, an ABC license transfer. See also the restaurant sale page.
How Escrow Fits In
An escrow company usually prepares the notice, tracks the twelve business day wait and holds the money until the notice period ends. Opening escrow early is the simplest way to avoid a last minute scramble on closing week.
Escrow can also pay known creditors from the sale price, which keeps the buyer clear of old debts.
What Sellers Should Prepare
Gather a list of creditors, an inventory count, equipment records and a copy of your lease.
The notice relies on accurate information about the assets and the seller's business names used over the last three years, so check your fictitious names and prior entities with your attorney.
Questions to Ask Before Closing
Ask your attorney whether your sale counts as a bulk sale, who will give notice, which newspaper will publish it and when the twelve business days start. Ask escrow what creditor payments come out of the price and when you will see the rest.
Write the answers into the closing calendar so nothing waits on the last week.
Before You Close
This page is general information, not tax or legal advice. Dollar thresholds and details can change, so confirm with your attorney or escrow officer before you rely on any date. Ready to see a price range? Request a valuation call.