Unlike residential deals where a contract is issued with a purchase price by the buyer and - if the seller signs it - you are in-contract, commercial deals start with a non-binding LOI.
LOI spells out the following terms:
The LOI is drafted as a document that is sent to the sellers. From there, the sellers would "red-line" the document with changes that he/she wants and the buyers can counter these on the same document with their "red-line." If lawyers are involved, they will also add their own comments and changes to the same document. This can go back and forth a number of times until all terms are agreed on by both parties.
Based on the final version of the LOI, the buyer then submits a draft contract that will contain other legal terms. This too can go back and forth as a red-lined doc. Once this is finalized, we are in contract!