This is the fourth in a series of posts discussing the sale of a business from the seller’s perspective. In the first three posts, we provided an introduction to this series and discussed asset versus stock sales, seller financing, and earn-outs. In this fourth post, we’re moving away from deal structure issues and into the deal process itself, starting with letters of intent, or “LOIs” (also known as “term sheets”).
We’ve previously written about LOIs from the point of view a buyer of a business and recommended that a lawyer be engaged at the LOI stage. However, in this post we want to discuss some of the important points from the perspective of a seller of a business. Here are four tips for sellers in negotiating the LOI followed by a list of items sellers might consider including in the LOI. [Read more…]