The Fine Print · JTB Law · Practice ownership
A dental practice letter of intent can turn a promising conversation into a defined transaction. Before you sign, make sure the document reflects the deal you intend to pursue and gives your advisers a workable path to closing. Use these questions to prepare for a discussion with your dental transaction attorney and accountant.
1. What is being bought, and how will it be paid for?
Identify whether the proposal involves practice assets, ownership interests, or another arrangement. Ask what is included in the price and what is excluded. Equipment, supplies, accounts receivable, deposits, and real estate deserve explicit attention. Separate cash at closing from seller financing, contingent payments, or retained equity so that the headline number does not obscure the actual economics.
2. Which obligations start when the LOI is signed?
Do not assume the entire document is nonbinding because it is called a letter of intent. Confidentiality, exclusivity, access to information, and other provisions may create obligations before a purchase agreement is signed. Have counsel identify what is binding, when those obligations end, and what happens if negotiations stop.
3. Is the diligence process practical?
Clarify which financial, operational, contractual, and practice information will be available, who will review it, and how much time the team needs. Coordinate the review with your accountant, lender, and attorney. Ask how unanswered requests or newly discovered issues affect the timetable, proposed terms, and ability to proceed. Patient information requires an appropriate process; it should not be treated like an ordinary marketing attachment.
4. What must happen before closing?
- Financing: What approvals and lender requirements remain?
- Premises: Is there an acceptable lease, assignment, or real estate agreement?
- Transaction documents: What definitive agreements still need to be negotiated?
- Transition: What is expected of the seller after closing, and on what compensation terms?
- Timing: Are the proposed deadlines realistic for all of these workstreams?
5. Are the open business points visible?
List the decisions that still need to be made rather than assuming everyone shares the same understanding. Examples include how receivables will be collected, who will finish treatment already underway, and how related costs and payments will be handled. A short issues list can help the buyer, seller, and advisers focus their next conversation.
Bring the proposal to counsel early
For an initial discussion, prepare the current LOI or term sheet, the transaction location, proposed timeline, ownership details, and your most important business goals. JTB Law helps dentists evaluate practice purchases and sales and DSO transactions, with attention to how the documents work together.
Further reading: ADA: How to purchase with confidence; Michigan Dental Association: Overlooked purchase agreement terms.
This guide provides general information, not legal or tax advice. The effect of a particular document depends on its language, the facts, and applicable law. An attorney-client relationship begins only through an agreed engagement.
Discuss your next step
A complimentary 30-minute consultation is an opportunity to discuss your goals, the scope of your matter, and whether JTB Law is a fit. Representation begins after the engagement and any required conflict review are complete.
Or call (801) 850-6820. Please do not send confidential documents before an engagement is established.