Sample Letter of Intent (LOI)
A Letter of Intent (LOI) is a non-binding document that outlines the basic terms of an agreement between two or more parties. It is a preliminary step in a negotiation process and serves as a starting point for further discussions.
Here is a sample LOI for a hypothetical business transaction:
[Your Company Letterhead]
[Date]
[Recipient Name and Address]
Subject: Letter of Intent for [Transaction Name]
Dear [Recipient Name],
This letter constitutes a non-binding Letter of Intent ("LOI") between [Your Company Name] ("Company") and [Recipient Company Name] ("Recipient") regarding the potential [Transaction Type] of [Transaction Description].
1. Background
[ Briefly summarize the background of the transaction, including the parties' goals and motivations. ]
2. Transaction Overview
- [Transaction Type]: [Specify the type of transaction, e.g., acquisition, joint venture, license agreement.]
- [Transaction Subject]: [Describe the specific asset or business being transacted.]
- [Key Terms]:
- [Term 1]: [Briefly describe the term and its value, e.g., purchase price, royalty rate.]
- [Term 2]: [Briefly describe the term and its value.]
- [Term 3]: [Briefly describe the term and its value.]
3. Due Diligence
[Outline the due diligence process, including timelines and responsibilities.]
4. Closing
[State the expected closing date and any conditions precedent to closing.]
5. Non-Binding Nature
This LOI is non-binding and subject to the execution of a definitive agreement ("Definitive Agreement"). The Definitive Agreement will contain the complete terms and conditions of the transaction, and any transaction will only be finalized upon the execution of the Definitive Agreement.
6. Confidentiality
[State the confidentiality obligations of both parties.]
7. Governing Law
[Specify the applicable law governing the LOI.]
8. Notices
[Provide information on how to deliver notices.]
9. Entire Agreement
This LOI constitutes the entire agreement between the parties with respect to the subject matter hereof and supersedes all prior or contemporaneous communications, representations, or agreements, whether oral or written.
Sincerely,
[Your Name and Title]
[Your Company Name]
Please Note: This is a sample LOI and should be customized to fit the specific details of your transaction. You should consult with an attorney to ensure that your LOI is drafted correctly and protects your interests.
