Letter of Intent in minutes

What is a Letter of Intent?

A Letter of Intent (LOI) is a document that outlines the preliminary understanding between two or more parties who intend to enter into a deal, such as buying a business, leasing commercial space, or forming a partnership.

It captures the key terms you have agreed on in principle, the price, the timeline, the main conditions, before lawyers draft the full contract. It shows both sides are serious and keeps negotiations on track.

When do you need one?

A Letter of Intent is useful whenever you want to put a handshake understanding in writing before committing to a full contract. Common cases include:

• Buying or selling a business or its assets
• Making an offer on commercial real estate or a long-term lease
• Proposing a merger, acquisition, or joint venture
• Outlining a partnership or supplier relationship before formal contracts
• Expressing serious interest in a job, program, or academic position

Types of Letters of Intent

The right shape depends on the deal. We tailor the letter to your situation, including:

• Business purchase: buying or selling a company or its assets
• Real estate: an offer to purchase or lease commercial property
• Partnership or joint venture: outlining how the parties will work together
• Employment or academic: expressing intent to accept a role or join a program

What to include

A strong Letter of Intent leaves no doubt about what the parties intend and what happens next. Make sure yours covers:

• Full names and roles of all parties
• A clear description of the proposed transaction or arrangement
• The key terms agreed in principle: price, payment, and timeline
• Conditions that must be met, such as due diligence or financing
• Any exclusivity or confidentiality obligations
• Which provisions are binding and which are not
• Signatures and the date

Binding or non-binding?

Most Letters of Intent are intentionally non-binding on the main deal terms: they record where negotiations stand without forcing either side to close. But certain clauses are commonly made binding, such as confidentiality, exclusivity (no-shop), and who pays which costs if the deal falls through.

The safest approach is to say explicitly which sections bind the parties and which do not. We ask you exactly that during the guided questions, so your letter states it clearly.

Common mistakes to avoid

• Leaving it unclear which provisions are binding
• Skipping the timeline, so negotiations drag on indefinitely
• Omitting conditions like financing or due diligence
• Using vague deal descriptions that invite disputes later
• Signing without reading it as if it were the final contract