The issues addressed at the start of any Texas business sale usually progress in the following order, as an overview. As always, if you would like to know more about business law questions such as the legal issues involved in buying or selling a business, send me an email from my Contact Us page or call me 713-300-1946.


As you know from my prior posts, after the initial discussions between the buyer and seller, the terms start to come together and it should be put into writing so everyone is on the same page. This is important so its understood that some terms are agreed, while others are still up for negotiation. There is a significant amount of time and energy that go into a business purchase. Nobody wants to waste time. And, while you are chasing one deal you could be missing out on another. So, it makes sense to make sure everyone is at least serious enough to draft and agreement and put pen to paper.

An LOI is typically a short document that sets forth the buyer’s and seller’s agreement on issues such as:

  • Price and payment
  • Structure of the deal (share/membership purchase vs. asset purchase)
  • Due diligence
  • Confidentiality
  • No shop / Exclusivity


 The seller with disclose and the buyer will review the finances and business records. This will allow assessment of the value of  the company and further the negotiation to make sure that the business is as-represented by seller. The parties can also at this time negotiate around any issues such as liabilities, assets that are not requires for the purchase or not in a good condition, etc. This is the time to assess risks and benefits of the deal before moving forward and drafting the next key document which is more detailed and binding.


At this time, the parties have decided to move forward with the purchase and the final definitive agreement is drafted to reflect the terms negotiated. The parties typically each hire their own attorneys or they may share one attorney to get the deal put into writing. At closing, once everything is agreed, the parties sign the documents and comply with the agreement by paying any amounts due or transferring possession of the property.
If you would like to know more or are considering buying or selling a business, send me an email from my Contact Us page or call me 713-300-1946.