Spotlight: How to Sell a Liquor License
The Spotlight series provides helpful information about important business and professional licenses issued by the State of Florida. This installation provides information on how to sell your quota alcoholic beverage license.
While quota alcoholic beverages licenses are bought and sold like real estate, there isn’t nearly as much information available about license transactions. This article breaks down the elements needed to transfer a liquor license from one party to another.
Buyer: One of the most important parts of the transaction is identifying a viable buyer. Fortunately, quota liquor licenses can be relatively easy to move on the open market for an experienced professional. There’s no eBay or Amazon for liquor licenses, but there is a group of attorneys and brokers that frequently work in this space. If you are a quota lottery winner, one of these brokers will almost certainly reach out to help you market your license. This firm uses paid and organic web marketing along with old-school phone calls and relationships to market and sell licenses.
Asset Purchase Agreement: A contract is needed to establish the terms by which the license will be transferred from the seller to the buyer. This document will state the responsibilities of each party, specific timelines, and payment deadlines. Importantly, the buyer will need to transfer a refundable deposit upon entering into the agreement.
Escrow Agent: A third party is needed to hold the deposit funds until the transaction is closed. A lawyer will generally serve as the escrow and closing agent to ensure that the documents (and money) are properly transferred between the parties.
Department of Revenue Forms: An applicant for the transfer of a quota license must provide records of gross sales of alcoholic beverages for the 3 years immediately proceeding the transfer of the license. In lieu of providing sales records, an applicant may elect to pay the maximum $5,000 fee. The buyer will need to provide signed copies of Department of Revenue Form DR-835 and ABT’s Department of Revenue Clearance Form (ABT-6002 Section 13) in order to facilitate the license fee calculation process.
Transferor’s Affidavit (ABT-6002 Section 10): The Division of Alcoholic Beverages and Tobacco will not transfer the license unless the seller authorizes it with a notarized signature on this form.
No-Lien Affidavit: If appropriate, the buyer will sign a document confirming that the license will be free and clear of all liens, mortgages, encumbrances, claims and demands as of the closing date.
Bill of Sale: The bill of sale is the final document that transfers the ownership interest from one party to another.
Closing Statement: The closing statement shows the financial details of the transaction, and will include credits for deposit payments and certain pre-paid licensing fees.
Bank Account: Wire transfers are usually faster, so get your bank information together.
The key is working with a professional that can guide you through the process. Feel free to reach out to the firm as you consider whether and how to sell a liquor license in Florida.