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  • I Advice - Understanding the Letter of Intent (LOI) in the Sale of a Business

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    If I am a seller, I am going to insist that I have this letter establishing the economics of the deal before I agree to allow
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    The letter of intent is an essential step in facilitating the sale of a business. The purpose is to establish the economic framework for buyer and business seller to move to the due diligence phase. It basically says that with all the available information I have thus far seen and if that all stands the scrutiny of due diligence, I am willing to buy your business for X dollars under Y payment terms. It is however, non- binding pending the execution of mutually acceptable purchase agreements.

    If I am a seller, I am going to insist that I have this letter establishing the economics of the deal before I agree to allow

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    amework for buyer and business seller to move to the due diligence phase. It basically says that with all the available information I have thus far seen and if that all stands the scrutiny of due diligence, I am willing to buy your business for X dollars under Y payment terms. It is however, non- binding pending the execution of mutually acceptable purchase agreements.

    If I am a seller, I am going to insist that I have this letter establishing the economics of the deal before I agree to allow

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    ation I have thus far seen and if that all stands the scrutiny of due diligence, I am willing to buy your business for X dollars under Y payment terms. It is however, non- binding pending the execution of mutually acceptable purchase agreements.

    If I am a seller, I am going to insist that I have this letter establishing the economics of the deal before I agree to allow

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    rs under Y payment terms. It is however, non- binding pending the execution of mutually acceptable purchase agreements.

    If I am a seller, I am going to insist that I have this letter establishing the economics of the deal before I agree to allow

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    If I am a seller, I am going to insist that I have this letter establishing the economics of the deal before I agree to allow my company to be turned inside out with buyer staff and advisors. If, as the seller, I want $5 million and the LOI specifies $4.5 million, I am going to attempt to negotiate up before I counter sign this letter. If I am still short on price and terms, I continue to sell the company to other interested buyers.

    If I am the buyer, I want the seller to commit to my economic parameters before I spend thousands going through due diligence. The other important element of the LOI from the buyer’s pe

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