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Letter of Intent Template

A Letter of Intent (LOI) is a non-binding agreement that expresses interest in continuing negotiations towards a potential transaction, such as purchasing a business. It can present initial terms but is not legally binding. However, it is important because it is usually accompanied by a confidentiality agreement preventing the parties from pursuing other offers during negotiations. The LOI summarizes the understanding reached so far between parties and indicates support for continuing discussions towards a final agreement.

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737 views4 pages

Letter of Intent Template

A Letter of Intent (LOI) is a non-binding agreement that expresses interest in continuing negotiations towards a potential transaction, such as purchasing a business. It can present initial terms but is not legally binding. However, it is important because it is usually accompanied by a confidentiality agreement preventing the parties from pursuing other offers during negotiations. The LOI summarizes the understanding reached so far between parties and indicates support for continuing discussions towards a final agreement.

Uploaded by

PFMPC Secretary
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOC, PDF, TXT or read online on Scribd
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LETTER OF INTENT, LOI

A Letter of Intent (LOI) is a non-binding agreement which express the interest to continue with the
next steps in a transaction such as to purchase a business. Additionally to the expression of
interest, the document may be use for presentation of initial terms for the contemplated
transaction.

While the agreement is not legally binding, it is although an important part of a purchasing process
due to its association with a confidentially agreement signed by both parties which temporarily
forsake other offers.

LETTER OF INTENT

1
After friendly consultations based on the principles of equality and mutual
benefit,

....................................................................................... ('Party A’)

and

....................................................................................... ('Party B')

have agreed to execute this Letter of Intent to accord the understanding


reached during discussions and to indicate their support for continuing
negotiations.

1
1. This Letter of Intent is dated the .................. day of. ................. 20_ _

2. Party A agrees that Party B has the product and ability to undertake transactions for
the purpose of supplying a product to Part A. The parties agree that discussions
between Party A and Party B have greatly advanced the understanding between the
parties concerning the products required by Party A and the ability of Party B to
provide the products.

3. The parties agree to continue their discussion during ............................[period of time]


with the aim of reaching agreement for the sale and purchase of product.

4. A negotiation agreement would involve Party B providing proof of supply of the


product where Party A would provide proof of payment for the purchase of the
product in a manner to be agreed upon in .................................................

5. The parties agree that the transaction to the Directors of each party for approval of the
terms and conditions of the proposed transaction, shall not proceed unless such
approval is obtained from the respective Boards.

6. If a transaction is to be undertaken in ....................................it shall be in accordance


with the laws of .............................................................

7. The parties agree to meet the preformed and negotiable credit conditions of each
party in order to establish a satisfying product, sales, purchase and delivery schedule
of agreement.

1
SIGNED by: .....................................................

On behalf of: ....................................................

SIGNED by: .....................................................

On behalf of: ....................................................

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