Deepak Choudhary (the "Buyer") proposes to acquire substantially all of the assets of Star Smog (the "Company") from its owner (the "Seller"). This Letter of Intent ("LOI") is intended to facilitate good-faith negotiation toward a definitive agreement and is non-binding except as expressly set forth in the Governing Law, Confidentiality, Costs, and exclusivity provisions below.
The Buyer proposes a total purchase price of $4,250,000 for substantially all of the assets of the Company, structured as an asset purchase.
The purchase price is proposed to be financed as follows:
Of the Seller Note described above, $300,000 shall be held back and governed as a risk holdback released as set forth in Section 2, securing the Seller's post-closing obligations relating to lease, licensing, certificate-cost, and financial-verification matters.
The following terms are proposed as reasonable, good-faith conditions to address the specific open items identified in diligence. They are protective in nature, not punitive, and are intended to let both parties close with confidence.
The acquisition includes substantially all assets used in the operation of the Company, including customer relationships and contracts, goodwill, the trade name and associated intellectual property, the domain name and website, online reviews and listings, all testing equipment, tools, fixtures, and any vehicles used in the business, and operating systems and records.
Excluded assets are cash and cash equivalents, pre-closing accounts receivable, and the Seller's personal assets not used in the business.
Upon execution of this LOI, the Seller shall grant the Buyer an exclusivity (no-shop) period of sixty (60) days during which the Seller will not solicit, entertain, or negotiate competing offers.
Closing is conditioned on: (a) verification of the Company's financial performance, including SDE of $933,596 and the revenue/SDE trend through TTM July 2026, via tax returns and a quality-of-earnings review; (b) the Buyer obtaining a final SBA 7(a) loan commitment; (c) a net working capital true-up at closing to a mutually agreed normalized level; and (d) no material adverse change in the business, its financial condition, or key vendor/lease relationships prior to closing.
LOI Execution — upon signing (target: November 2026). Due Diligence Period — 60 days from LOI execution. Definitive Purchase Agreement — executed within 75 days of LOI execution. Closing — within 30 days of the definitive agreement. Holdback Release — amounts held back under Section 1 released upon satisfaction of the related conditions in Section 2, and in any event no later than 12 months after closing.
This LOI shall be governed by and construed in accordance with the laws of the State in which the Company operates, without regard to its conflict-of-laws principles. This section is binding.
Both parties shall keep strictly confidential the existence and terms of this LOI and all information exchanged in connection with the proposed transaction, and shall not disclose such information except to advisors and lenders with a need to know. This obligation survives for two (2) years from the date of this LOI. This section is binding.
Except for the exclusivity provision in Section 4, Confidentiality (Section 7), Governing Law (Section 6), and Costs (Section 9), this LOI is non-binding and creates no obligation on either party unless and until a definitive purchase agreement is executed by both parties.
Each party shall bear its own costs and expenses, including legal, accounting, and advisory fees, incurred in connection with this LOI and the proposed transaction, regardless of whether the transaction closes.
Upon acceptance, the Buyer will commence formal due diligence and provide a document request checklist. The Seller is asked to provide the records list, including tax returns, current leases, certificate vendor/state agreements, advertising channel detail, and owner-compensation records. Both parties will engage counsel to prepare the definitive purchase agreement and ancillary documents, including the seller transition/consulting agreement, non-compete, escrow/holdback terms, and lease assignment.
Agreed and Accepted:
Buyer: _______________________________ Deepak Choudhary Date: October 29, 2026
Seller: _______________________________ Name: ____________________ Date: ____________________