Canada:
Deposit, Break Fee Or Neither?
27 January 2020
Clark Wilson LLP
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The sale of a business to a third party is a great business
succession strategy. While a sale is a complex and time consuming
process, a business owner needs to know when to push the
negotiations and when to hold back. One issue that can derail a
negotiation is whether or not the seller of a business should
insist on a deposit, a break fee or neither.
Firstly, what's the difference between a deposit and a break
fee? A deposit is one way of confirming that a buyer is
serious.
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The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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