After 5 months under LOI, the seller suddenly asked my friend to secure the seller note with a PG.
The deal died the next day.
Some sellers struggle to come clean when they have mixed feelings or have changed their minds. The right thing to do, of course, would be to share their change of heart, pause the diligence, and express a motivation to re-engage at a later date. Instead, some can’t get themselves to confront the situation, and let the other side (the buyer / you) rack up deal expenses and opportunity cost.
And when the 11th hour comes around, instead of coming clean, they’ll sabotage the deal with bogus arguments or totally unreasonable demands, which will force you to take a hard stance and become the bad guy.
“Sign a PG.”
“My adult baby child needs written contract of permanent employment at $300k/yr.”
“Sign a 10-year lease of the office I own at 30% above market prices.”
This way, when you balk, they’ll rewrite the story, where you were stubborn and walked away.
It’s the worst, and I wish them the worst.
