The Process of Selling Your Business– Offer and Acceptance Page 4 of 5

An offer may come first as a Letter of Intent (LOI).  It’ll generally include the price and terms being offered, the sale structure (asset sale versus stock purchase), a closing date, contingencies and conditions of a sale.

Terms presented in an offer may outline the payment method, scope and length of a non-compete agreement, transition terms, incentive payments, identification and condition of assets being bought, identifying of liabilities to be thought, any seller guaranties, and other exchange details. Contingencies will detail all action items needed before completion of sale.   Verification of monetary and operations information ( Due Diligence ), acceptable inspections, adequate lease transfer arrangements, adherence to licensure and regulatory bodies certifications, financing approval, lawyer review and approval of all sale documents, are all common sale conditions. Contingencies will most likely be tied to completion dates. An offer might be accepted, defied, or changed and presented back to the buyer as a counter-offer. Till agreement is reached by both parties, either party may withdraw their offer. In considering an offer, be certain to appraise the purchaser’s qualifications, financial resources, and methodology of securing any payments to be made. A great price from a risky buyer won’t be the best answer.