LOI Review for Buying or Selling an Online Business

Should a lawyer review your LOI before you buy an online business?

Yes. Legal review before signing can catch unclear terms, unexpected binding provisions, and a structure that doesn’t match the deal. It is easier to address those points before the parties spend time and money on diligence and the purchase agreement.

For example, a buyer may expect to acquire an Amazon account, domain, trademark, inventory, and customer data while the LOI refers only to “business assets.” The review can flag that gap before the asset list becomes the starting point for the purchase agreement.

What terms in an LOI are binding?

The LOI’s language controls. Most deal terms may be nonbinding while confidentiality, exclusivity, break provisions, information access, expenses, governing law, or return-of-information duties are binding. The full text, the parties’ conduct, and applicable law still matter.

For example, a 60-day exclusivity period can bind the seller even when the buyer’s diligence plan lasts only 30 days. The LOI should identify each binding provision and state when it begins and ends.

What should an online business LOI cover?

The LOI should identify the parties, transaction structure, purchase price, payment timing, assets, excluded liabilities, and major closing conditions. It should also address seller financing, inventory, marketplace accounts, domains, intellectual property, transition support, restrictive covenants, and worker relationships when they matter.

For example, a $40,000 inventory line with no count method can leave the parties using different quantities or valuation dates. The same problem appears when a seller note states a rate but omits the payment start date. In our experience, those details are easier to settle while the business terms are still being negotiated.

What LOI mistakes do online business buyers make?

Buyers often sign before testing whether the LOI works for the actual assets, financing, and timetable. That can make an unclear business term harder to change when the purchase agreement arrives.

• Incomplete asset list. For example, the LOI names the website but omits the domain, trademark, advertising accounts, or inventory.
• Unfinished financing terms. A seller note may state principal and interest but omit payment dates, maturity, or security.
• Mismatched deadlines. Exclusivity may expire before diligence or lender approval can finish.
• Assumed transfers. Marketplace rules, third-party consents, and customer-data restrictions may affect what can move at closing.

That said, counsel explains the legal consequences while the client decides price, timing, and risk allocation. Each is ultimately a business term.

What should you provide for an LOI review?

Send the current LOI, your role in the deal, and the terms you want reviewed. Include the signing deadline and any earlier drafts or comments that explain unresolved changes.

1. Attach the current LOI.
2. State whether you are the buyer or seller.
3. Describe the proposed transaction structure.
4. Identify the purchase price and payment terms.
5. List the assets, liabilities, and closing conditions that matter most.
6. Flag every term that remains open.
7. Include the signing deadline.

For example, a buyer can flag that inventory remains subject to a closing count and the seller note still needs a payment start date.

What does an LOI review cost?

Ecommerce Law Group offers flat-fee LOI review. We quote the flat fee before work begins based on the LOI and the requested scope. Contact the firm to request a quote.

For example, a review with written comments has a different scope from a review that also includes revisions and a call with the client.

How fast can an LOI be reviewed?

Timing depends on the LOI’s length, complexity, requested work, and signing deadline. A focused review can move faster when the client sends the current LOI, deal structure, key business terms, and deadline at the start.

For example, a client facing a Friday signing deadline should identify that date with the first submission. The review still needs enough time for the client to understand the terms and decide what to revise.

What happens after the LOI?

The parties usually move into diligence and purchase-agreement drafting. The purchase agreement turns the agreed business terms into detailed rights, obligations, closing conditions, and transfer documents.

For example, a seller note described in one LOI paragraph may require a promissory note, payment schedule, security terms, and closing deliverables. The LOI sets the commercial direction, while the final documents do the detailed work.