[davismwfl]

I'd say you need an attorney now to help you, mistakes made at this stage can be costly later. I don't think it should cost you all that much to have an attorney help you review or adjust it if needed.

And the terms also depend on the size of the deal. Not asking you to tell me, just that a deal worth $100k is different than a deal worth $5M. Also, it would depend on if their intent is to purchase your company through an asset sale or a stock sale as to some of the terms you should pursue.

Consult with an attorney to protect you and your company. And consult with an accountant to make sure you don't get smacked hard on taxes based on the type of deal they want to setup.

[idont]

I tried to find a Merge and acquisition attorney/lawyer. None of them (the good ones) understand my business... Internet is too complicated for these guys... :( So to my experience, they are only of bad advice.

We are speaking about $10M...

[davismwfl]

You have to find an attorney that you can work with. A deal at that size is large enough that minor mistakes could be really costly to you. I get that many attorney's have no clue about technology or the internet. I struggle with that myself. What I wind up doing is making sure they are a solid attorney, and I'll deal with specifics on the business -- basically explaining to them things I feel need to be in the agreement and let them figure out how to make it stick legally. I have directly been involved in a couple of asset purchases of my own companies/products. Not to the size you are talking, but I found I had to study terms a lot and push the attorney's pretty good, don't consider them the end all of knowledge, they are a tool to use. And I don't mean that disparagingly, just that they can never know every business or detail, it is our job to educate them and show them areas we have concerns and a good firm/attorney will figure out how to protect you.

You might be able to get some older sales/purchase documents online to use as examples of things to watch out for. I can share privately some of the "standard" clauses we had placed in our documents, but I really think you need a good attorney and CPA. As every deal is unique.

One other point, you can't stop them from using knowledge they gain from the due diligence part of the process. Yes you can put clauses in the letter of intent, agreement etc, but that just means you can sue them if you catch them later. Of course, they will claim they gained that knowledge independently and its hard to prove. This is why you limit the duration of due diligence. Keep it as short as possible so they have to act or leave, but not so short that you are unreasonable. Also, why I never had one, to me this is where a breakup fee may be worthwhile, make it painful for them not to complete the transaction, so that if they are just tire kicking to "learn" it still has costs.