After the letter of intent has been signed by the buyer and
seller of a business, the negotiation of the legally binding
transaction documents begins. Typically, the buyer's lawyer
will prepare the initial draft of the asset or share purchase
agreement since it is the buyer who will be concerned with
obtaining appropriate representations, warranties and indemnities
relating to the business for its protection. Likewise, the buyer
will typically prepare the first drafts of the post-closing
non-competition agreement, and any employment or consulting
agreement to be entered into by the seller.
The negotiation of these documents will typically take place
over a period of several weeks while the buyer's due diligence
review and analysis of the business continues and the documents may
change depending on the results of that due diligence. The seller
and its representatives will review and negotiate the agreements
with a view to maximizing the seller's return and
