Conditions precedent

Things that must happen before a transaction completes - a consent obtained, a licence transferred, a regulatory approval granted.

Example

Requiring the licensor's written consent to the change of control before any money moves.

A condition is worth having only if you are genuinely prepared to walk when it is not met. One everybody expects you to waive is decoration.

Deal killer — An established finding that no achievable price can address - because the asset stops being the asset, because the exposure has no floor, or because the counterparty has been shown to be unreliable.
Change-of-control clause — A contract term letting the counterparty terminate, renegotiate or withhold consent when the ownership of the other party changes.
Walk-away price — The price above which, or the specific finding after which, you have decided in advance not to proceed - written down and dated before the process begins.

Deal killers: the findings that end it — A deal killer is not a very large red flag. It is a fact that has already been established and that no price adjustment can reach. (8 min)
First confirm the company you are investing in is the one that owns the business — Legal diligence starts with structure: where the company is incorporated, whether it is in good standing, which entity holds the customers, contracts and IP, and whether the shares being offered can be issued. (10 min)