Question re: Escalation Clause & Seller's "Sideways" Response

[Danielle Polen]

My agent and I submitted an all-cash offer earlier today that included a sale price above the list price as well as an escalation clause. Seller's agent has now come back to my agent and asked: "what is your client's highest and best offer?," to which my agent responded, "the offer you received earlier today with the escalation clause!" Seller's agent informed my agent that another prospective buyer escalated more, but added that "the seller would prefer to work with your buyer since it's a cash offer." My guess is that the seller thought that the bidding would go higher than it did, and she's looking for more but also wants an easy-to-close cash offer. Since the seller did not come back to us with a counter-offer, I don't know how much the other prospect offered in their escalation clause. The seller is, in essence, asking us to rebid without any proof that the other prospect did, indeed, escalate higher. I'd appreciate any constructive advice you might offer. Property is in MD.