Legal Question in Business Law in Illinois

Re: Acquisition Down Payment

Everything is negotiable in a business purchase. Having said that, the seller taking back financing is almost always, in my experience, required to subordinate his debt to a commercial lender. Commercial lenders generally will not lend in second position, and may require the seller to enter into a standstill agreement.

The seller's required structure for your financing may sink your deal, and probably would sink any deal except for a cash buyer. If his attorney is really proposing that as the only alternative, the seller may need to get more creative and give you some alternatives, or you may be better off, if you can, financing the whole purchase price.

I would need to know more about the economics and other terms to assist you further. You should consult with your own attorney at some point in this negotiation, to insure that you get what you pay for.

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