Not every post-LOI price change is a tactic
A legitimate retrade should be tied to new, material, and measurable information.
A retrade occurs when a buyer seeks to change the economics after agreeing to a letter of intent (LOI). Sellers understandably dislike it. Still, not every retrade is evidence of bad faith.
A good-faith adjustment usually begins with information that was unavailable, incomplete, or materially different when the LOI was signed. Examples may include an undisclosed liability, a customer loss, a working-capital shortfall, or earnings that do not reconcile to the figures used in the original valuation.
The buyer should be able to explain three things: what changed, why it is material, and how the proposed adjustment was calculated. The response should be proportionate to the issue. A temporary variance should not automatically support a permanent reduction in value, and a balance-sheet item should not be treated as though it permanently reduced earnings.
The seller also has responsibilities. If information was inaccurate, address it directly. Correct the record, quantify the effect, and distinguish a one-time issue from an ongoing change in performance. A transparent response often produces a narrower and more defensible solution.
Good-faith retrades are negotiations about facts. Bad-faith retrades exploit the seller’s reduced alternatives after exclusivity. The distinction becomes clearer when the parties put the issue, evidence, and valuation logic in writing.