Breaking Down the LOI: What Business Owners Need to Know
From Transaction Talk by Jennifer Fox and Eric Sigman
January 5, 2026 · 21 min · Season 1 · Episode 42
About this episode
The episode breaks down the importance and role of a Letter of Intent in business transactions.
A Letter of Intent may not be legally binding, but it can determine whether a deal moves forward or falls apart. In this episode of Transaction Talk, hosts Jennifer Fox and Eric Sigman break down the role an LOI plays in buying and selling a business, and why it deserves serious attention from both buyers and sellers. They explain what an LOI is, what it typically includes, and how it sets expectations around price, structure, timing, contingencies, and exclusivity. The conversation covers how LOIs provide a framework for due diligence and financing, how exclusivity protects buyers during the process, and why clear timelines help prevent deals from stalling. The episode also explores working capital, financing terms, and how sellers evaluate competing offers. Eric closes with a practical reminder that even when it is nonbinding, an LOI carries weight and should be approached thoughtfully. Listen in for a clear, practical breakdown of how LOIs guide successful transactions! Key Points From This Episode: What a Letter of Intent (LOI) is and why it starts most business transactions. How LOIs, term sheets, and offers are commonly used interchangeably. Why buyers use LOIs to show…
People in this episode
Hosts: Jennifer Fox, Eric Sigman
Topics covered
- Letter of Intent
- business transactions
- due diligence
- financing
- exclusivity
- purchase price structure
Keywords
- LOI
- business buying
- selling a business
- transaction framework
- working capital
- financing terms
- competing offers
Mentioned in this episode
Organizations: Transaction Talk
More episodes of Transaction Talk
- Understanding Reps, Warranties & Deal Risk · June 12, 2026 · 21 min
- Why Small Businesses Matter to Our Communities with Gregory Giacopelli · May 27, 2026 · 20 min
- What is My Business Worth - How Valuations are Made · May 12, 2026 · 27 min
- Top 5 Deal Killers With Aaron Fox · April 29, 2026 · 25 min
- Inside the Buyer's Mind: Who's Buying & What Industries · April 13, 2026 · 24 min
- When Is the Right Time to Sell · March 30, 2026 · 21 min
Explore listener stats, chart rankings, contacts and more on the Transaction Talk podcast page.