I’m very curious what kind of quotes people get for drafting an APA

searcher profile

April 06, 2022

by a searcher in Cape Coral, FL, USA

Hi everyone; I’m currently putting together my designated transaction team. I’m very curious what kind of quotes you guys have been getting by your attorneys when wanting to have your asset purchase agreement (APA) drafted. What’s the usual price their quoting?

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commentor profile
Reply by a professional
from University of Minnesota in Minneapolis, MN, USA
Wow, some very interesting answers here! This is a very practical question - surprised I haven't seen it asked before.

My preferred method is something of a hybrid - Once I have a decent handle on a transaction (preferably an LOI and at least one detailed discussion with the client), I quote a flat fee for the first draft of the PA, which includes all time necessary to draft, revise, and discuss an initial draft of the Asset Purchase Agreement prior to forwarding it to Seller for review. Basically all the time needed to draft a PA that both I and the client are happy with up until it goes to the other side. Typical pricing for me is between $2500 and $7500 for this initial draft version (I hope I don't regret using specific numbers!) Additional time beyond this draft version is billed hourly. I hate tracking time, but it's hard to flat fee beyond this initial draft because there are just too many unknowns.

That said, if I can quote $300-500k like others in this thread have mentioned, I'll draft the PA and all the revisions, do the legal due diligence, fly to the Closing on my dime, and probably wash your car while I'm there! DMs are open!
commentor profile
Reply by an investor
from University of Pennsylvania in Charlotte, NC, USA
There are several widely used model purchase agreements readily available to attorneys. These off-the-shelf documents can be adapted to a vanilla transaction with minimal work. If that's all you need in terms of counsel, you can likely find a low price. As others have noted, that's rarely all you need. At the outset of documenting a transaction, even with a well-drafted comprehensive LOI as a starting point, there are too many unknowns to credibly put a price on the legal work, perhaps with the exception of an extremely simple deal. As for caps, again what legal advice are you seeking and how complex is the deal? In the event that the seller's counsel extensively marks up your first draft and multiple rounds of redlines and negotiation are necessary, do you want to be in a position where your counsel stops work or devotes less time than is necessary because they capped their compensation?
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