Welcome back to another edition of The Wise Exit newsletter. Here's what we're covering this week:

Let's dive in.

The Moment Your Leverage Disappears

Signing a letter of intent is a real milestone. You've run a competitive process, fielded multiple bids, and a serious buyer has stepped up. That's worth acknowledging.

But it's also the moment a lot of founders stop paying close enough attention — and that's where things can quietly go sideways.

Because the second you sign that LOI, the dynamic shifts hard in the buyer's favor. And if you haven't thought carefully about what you need before that moment, you'll find yourself negotiating from a much weaker position than you realize.

Here's what actually happens the moment you enter exclusivity:

1. Competition disappears. Every other buyer you spent months cultivating? They're done. You have to tell them thanks for playing and send them on their way. And competition is the single most powerful piece of leverage you had. Without it, you're no longer running an auction. You're in a negotiation with one party, and they know it.

2. You're locked in. Exclusivity means the buyer gets sole access to your financials, your data room, and your team while they finalize the purchase agreement. You can't shop the deal. In many cases, if another buyer even shows up at your door during this period, you're required to notify the acquirer.

3. The real legal terms get negotiated after you've lost leverage. Things like reps and warranties, indemnifications, caps and baskets. These aren't just legal formalities. They have a real impact on your life after closing. And they're much harder to fight for once you're already locked in.

That's why the window between your final bid round and signing the LOI is the most important negotiating moment in the entire process. Not the management meetings. Not the initial offers. This window right here.

Use the iterative bid rounds to sharpen your LOI terms, not just your price. Every round is a chance to push: the lease term should be five years, not three. This asset is excluded. This provision isn't acceptable. Get it in writing before you sign, because once you do, those conversations get a lot harder.

The goal is to enter exclusivity having already won as much as possible. Because the closer you are to the finish line, the more a buyer knows you want to get there.

Don't let the momentum of a signed LOI cost you in the fine print.

1️⃣ Do I know which terms matter most to me before I get to the LOI stage?

2️⃣ Am I using each bid round to refine my LOI terms, or just focusing on price?

3️⃣ What provisions in a purchase agreement could affect my life post-closing?

4️⃣ Have I talked to legal counsel about what to ask for before exclusivity begins?

5️⃣ If competition disappeared tomorrow, how strong would my negotiating position actually be?

☑️ Make a list of your non-negotiables before you get to the LOI: Price is one piece. Think about earnout structure, excluded assets, lease terms, and transition timelines. Write them down now so you're not scrambling later.

☑️ Loop in legal counsel earlier than you think you need to: Reps, warranties, indemnifications, caps and baskets: these terms follow you past closing. You need someone in your corner who understands how to protect you before the LOI is signed.

☑️ Treat every bid round as a term-shaping opportunity: Each time buyers come back with a revised offer, use it as a chance to refine the LOI language alongside the price. The process is the negotiation, until it isn't.

That's all for this week. Remember that leverage in an M&A process isn't something you build at the end. It's something you protect all the way through — especially right before you sign.

If you want help thinking through your LOI strategy or where you stand heading into exclusivity, reply to this email or contact us here. We're always happy to walk you through your options.

Talk next week,

Brian Dukes
Managing Partner at Exitwise