LOI Attorney in California

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Acquisition Stars advises buyers and sellers on loi attorney matters across California.

Serving 1 market across California.

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LOI Attorney Practice in California

Acquisition Stars advises buyers and sellers on loi attorney matters across California. Alex Lubyansky leads every engagement, and has been M&A counsel since 2013 across transactions of varying complexity, from lower-middle-market deals to multi-party structures.

California Transaction Considerations

  • California's complete ban on non-competes (Business & Professions Code Sections 16600 and 16600.5) voids agreements regardless of where or when they were signed, overrides choice-of-law provisions applying another state's law to California employees, and gives workers a private right of action with one-way attorney fee shifting
  • The California Environmental Quality Act (CEQA) can delay transactions involving real property or businesses with significant environmental footprints
  • California gives the spouse who operates a community property business primary management and control under Cal. Fam. Code 1100, but that spouse must give the other spouse prior written notice before selling all or substantially all of the business personal property, and both spouses must join to sell community real property

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LOI Attorney Service Areas in California

Acquisition Stars represents clients in each of the following markets. Click any city to learn about letter of intent law services in that area.

Los Angeles

LOI Attorney in Los Angeles

California Legal Framework for Letter of Intent Law

Non-Compete Agreements

The LOI should state the seller covenant in terms the state will enforce, or the term sheet promises what the purchase agreement cannot deliver.

Banned entirely. Limited exception for sale of a business.

Non-compete agreements are void and unenforceable under California Business and Professions Code Section 16600. This ban applies broadly, with narrow exceptions only for the sale of a business (the seller may be restricted from competing with the sold business), dissolution of a partnership, or dissolution of an LLC. Even with the sale-of-business exception, restrictions must be reasonable.

Tax Considerations

Tax clearance and successor liability rules decide which closing conditions the LOI should reserve.

California imposes an 8.84% corporate franchise tax on C-corporations and a 1.5% franchise tax on S-corporations. The state does not conform to federal qualified small business stock exclusions. Under California community property rules, the spouse who operates a business that is substantially all community personal property has primary management and control and must give the other spouse prior written notice of a sale of all or substantially all of the business personal property, and both spouses must join to sell or encumber community real property, under Cal. Fam. Code 1100. California sources income based on market-based sourcing rules, which can affect multi-state deal structures.

Filing Requirements

Spousal consent, entity filings, and clearance certificates belong on the LOI's closing-deliverables list.

Mergers and asset acquisitions require filings with the California Secretary of State. The California Franchise Tax Board requires tax clearance certificates for dissolving entities. Bulk sales transactions require Notice to Creditors filings. Foreign entities must qualify with the Secretary of State before doing business in California.

Bulk Sales / Asset Purchases

Creditor notice periods set the earliest closing date the LOI can promise.

California retains a modified Bulk Sales Act under California Commercial Code Sections 6101-6111, applicable primarily to businesses whose principal activity is the sale of inventory. Buyers must comply with notice requirements to the seller's creditors at least 12 business days before the bulk transfer. Failure to comply allows creditors to void the transfer.

The federal framework for a letter of intent

  • A letter of intent sets the framework for a business sale before either side commits real money to due diligence. It records the price and structure the parties have agreed to explore, sets an exclusivity period that keeps the seller from shopping the deal elsewhere, and lays out a target closing calendar the rest of the transaction will be built around.
  • Most of an LOI's business terms are deliberately non-binding, subject to what diligence and the definitive agreement negotiation later confirm. A narrower set of provisions, typically exclusivity, confidentiality, and any expense reimbursement or break-up provision, do bind the parties from signature. Which category a given term falls into is the question worth resolving before signing, not after.

A letter of intent can start the antitrust clock

An HSR-reportable acquisition cannot close until both parties file and the waiting period, 30 days after filing or 15 for a cash tender offer, ends, under 15 U.S.C. 18a. From February 17, 2026 the threshold is $133.9 million; exemptions can exclude a deal. Outside 16 CFR 801.30, filing requires an executed contract, agreement in principle or letter of intent and the affidavit in 16 CFR 803.5(b).

Sources: 15 U.S.C. 18a(a), 15 U.S.C. 18a(b)(1)(B), 16 CFR 803.5(b), FTC, New HSR Thresholds and Filing Fees for 2026

Confirm the current filing form before relying on the LOI

The FTC states that it is accepting HSR filings on the form and instructions that were in place before February 10, 2025, after a federal district court vacated the 2025 form on February 12, 2026 and the court of appeals denied a stay on March 19, 2026. Filers may still use the 2025 form voluntarily. The current text of 16 CFR 803.5(b) requires an affidavit that a contract, agreement in principle or letter of intent has been executed and that the filer intends in good faith to complete the transaction. It also still contains the dated-document attestation added in 2025. Because the appeal is pending, counsel confirms the accepted form, instructions and affidavit wording on the FTC premerger page at filing time. A letter of intent meant to support an early filing should describe the parties, structure and scope clearly enough to match what the filing describes.

Sources: FTC, HSR Notification Forms, Instructions & Guidance, 16 CFR 803.5(b)

Diligence focus for a letter of intent

  • Exclusivity period length measured against a realistic diligence and financing timeline
  • Which specific provisions bind at signature versus remain open to negotiation
  • Break-up fee or expense reimbursement triggers if either side walks away
  • Price and structure language written so the definitive agreement can actually deliver it
  • Confidentiality scope for materials shared before a definitive agreement is signed

Other M&A and Securities Services in California

Acquisition Stars handles M&A transactions for California clients and works with securities counsel on securities matters. Alex Lubyansky leads every M&A engagement.

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Ready to Discuss Your California Deal?

Alex Lubyansky leads every letter of intent law engagement, with an associate supporting the work.

M&A counsel since 2013. Nationwide practice. LOI through closing.

Request Engagement Assessment

We review every transaction inquiry within one business day.

Please do not include confidential information in this form. Submitting this form does not by itself create an attorney-client relationship. Privacy Policy