Is an LOI legally binding?

An LOI can contain both binding and non-binding provisions; clearly label which clauses are intended to bind the parties. ESIGN (15 U.S.C. ch. 96) and state law (UETA where adopted) support electronic execution when intent, consent, attribution, and retention are present.

Can an LOI be signed electronically?

Yes. Electronic signatures are valid under the ESIGN Act and UETA when the transaction is not an exception to e-signature laws. Ensure the platform documents intent, consent, and preserves a retrievable record.

Do I need notarization or witnesses for an LOI?

Not typically required for LOIs, but specific transaction elements (e.g., deeds, powers of attorney) may require notarization. If a notary or witnesses are requested, follow state rules or use a compliant RON provider where available.

How do I revoke or cancel an LOI?

Revocation depends on the LOI wording and whether any provisions are binding. Absent a binding clause, provide clear written notice and follow agreed termination steps. Consult counsel if obligations or reliance damages are possible.

Who should sign the LOI on behalf of an entity?

An authorized officer or person with delegated authority should sign. Verify corporate authorization with a board resolution or power of attorney if the signatory is not an officer.

What supporting documents should accompany an LOI?

Common attachments include NDAs, indicative budgets, preliminary term sheets, cap tables, and limited due diligence items. Label exhibits clearly and reference them in the LOI body.

Electronic Signature
Templates
Finance
Financial Project LOI

Financial Project LOI

This template is fully customizable. Edit the text, fill out the fields, and send it for signature. Give it a try!

FINANCIAL PROJECT LOI

Parties and Date

This Letter of Intent ("LOI") is entered into as of between the proposed lender/investor and the project sponsor/developer identified below.

Lender / Investor Name Lender / Investor Address Sponsor / Borrower Name Sponsor / Borrower Address

Project Summary

Project Name:

Project Description

Proposed Financing Terms

The proposed material terms of the financing are as set forth below. These terms are indicative and subject to satisfactory due diligence and execution of definitive documentation.

Facility Type
Principal Amount
Interest / Return
Term / Maturity
Amortization / Repayment
Security / Collateral
Fees & Expenses
Conditions to Closing

Use of Proceeds & Schedule

Use of Funds (summary) Proposed Funding Schedule

Milestone	Amount

Due Diligence & Closing Conditions

The parties acknowledge that completion of the financing is subject to customary and satisfactory due diligence, including but not limited to financial, legal, title, environmental, and technical reviews. The lender’s obligations are conditional upon execution of definitive documentation containing customary representations, warranties, covenants and events of default.

Key Due Diligence Items / Conditions

Exclusivity & Confidentiality

For a period of days following the date of this LOI, the Sponsor shall not solicit or negotiate alternative financing commitments with third parties. The parties agree to keep confidential all non-public information exchanged in connection with this LOI except as required by law.

Binding and Non-Binding Provisions

Except for the provisions regarding confidentiality, exclusivity, governing law, expenses and notices explicitly stated as binding herein, this LOI is non-binding and is intended only as a statement of the principal terms for negotiation of the definitive financing documents. Neither party shall be legally obligated to consummate the financing unless and until definitive agreements are executed and delivered.

Fees, Expenses & Breakage

Each party shall bear its own legal and advisory fees and expenses incurred in connection with the negotiation of definitive documentation unless otherwise agreed in writing. If a party terminates in breach of a binding obligation set forth herein, the breaching party shall be liable for documented third-party costs reasonably incurred by the other party.

Governing Law; Notices

This LOI shall be governed by and construed in accordance with the laws of the state specified below. Notices under this LOI shall be given in writing to the addresses set forth below and shall be effective upon personal delivery or three business days after deposit with a nationally recognized courier.

Governing Law Lender Notice Contact Borrower Notice Contact

Expiration & Acceptance

This LOI will expire if not accepted in writing by the other party on or before . Acceptance of this LOI shall be evidenced by signature of an authorized representative of each party.

Additional Terms or Remarks

Representations & Authority

Each party represents and warrants that it has the requisite power and authority to enter into this LOI, that the individual signing on its behalf has the authority to do so, and that no other approvals are required to bind the signing party to the commitments set forth herein.

Lender / Investor — Printed Name:

By:

Date:

Sponsor / Borrower — Printed Name:

By:

Date:

What a Financial Project LOI Is and When It’s Used

A Financial Project LOI (Letter of Intent) is a preliminary, written statement outlining the principal terms and mutual expectations for a proposed financing, investment, or project funding arrangement. It commonly summarizes parties, proposed capital amounts, material conditions (due diligence, approvals, timelines), confidentiality obligations, and the intended pathway to a binding agreement. An LOI sets negotiation boundaries, allocates early costs and responsibilities, and signals commitment without creating the final contract that will govern the transaction.

Why a Clear LOI Matters for Financial Projects

A well-drafted LOI reduces ambiguity, aligns expectations, and focuses due diligence by recording key commercial terms up front.

Who Typically Prepares and Signs a Financial Project LOI

Parties involved vary by transaction; below are common roles that prepare, review, or sign LOIs.

Sponsoring company finance team or CEO — drafts principal terms and budget allocations for investor review.
Investors or lenders — assess proposed capital structure, conditions precedent, and exit rights before committing.
Legal and accounting advisors — validate enforceability, tax consequences, and diligence items prior to signing.

Final signing authority rests with those authorized by each party’s governance rules or delegated signatory authority.

Essential Sections to Include in a Professional LOI

A concise LOI should present the transaction framework, material terms, and the next steps so all parties share a common baseline for negotiations.

Parties

Identify each legal entity with full legal name, jurisdiction of formation, and address so counterparty identity and contracting authority are clear.

Transaction Summary

State the proposed financing type, principal amount, valuation or price, equity/debt split, and any payment schedule or tranche conditions.

Conditions

List major conditions precedent such as satisfactory due diligence, regulatory approvals, board consents, third-party consents, and material contract assignments.

Exclusivity

If included, define any exclusivity or no-shop period with explicit start/end dates and permitted exceptions to avoid dispute.

Confidentiality

Reference or include a confidentiality clause or NDA to protect sensitive financial and operational disclosures during diligence.

Non-Binding vs Binding

State which provisions are binding (e.g., confidentiality, exclusivity, expenses) and which are non-binding to prevent unintended obligations.

Step-by-Step: Completing and Circulating the LOI

Follow these steps to prepare, approve, and circulate a Financial Project LOI in typical deal workflows.

01

Draft Terms: Assemble principal economic and legal terms in a single document.
02

Internal Review: Obtain approvals from finance, legal, and executive sponsors.
03

Share with Counterparty: Send the LOI with any supporting schedules or NDAs attached.
04

Sign & Record: Execute via authorized signatories and archive executed copies for diligence.

Configuring an Online LOI Workflow for Digital Completion

Map each form field and signer role before sending to minimize friction and ensure auditability during e-signing.

Field	Configuration
Signer Roles	Define primary signer, counterparty signer, and witness or notary roles if required.
Authentication	Select email, SMS code, or knowledge-based authentication based on deal sensitivity.
Conditional Fields	Enable conditional fields for variable consideration clauses or optional exhibits.
Audit Trail	Activate detailed audit logging: timestamps, IP addresses, and action history.

How Electronic Signing and eSubmission Typically Flow

A clear signing sequence reduces execution time and preserves evidentiary detail for later agreement drafting.

Upload Document: Sender uploads the LOI and attachments to the signing platform.
Place Fields: Add signature, date, and initial fields for each signer and witness.
Send Invitations: Platform issues email or link to each signer in the established order.
Completed Record: Signed LOI and the audit trail are stored and available for download.

Digital Signing: Technical and Compliance Considerations

Ensure the chosen platform supports legal and security features required by the transaction before circulating the LOI.

Authentication: Email, SMS, and stronger authentication like KBA or SSO for high-value financings.
Integrations: Ability to connect with CRM, document storage, or deal management systems improves traceability.
Compliance: Platform should support ESIGN/UETA compliance and industry-specific needs (HIPAA BAA, 21 CFR Part 11 where relevant).

Verify platform encryption, audit capabilities, and retention settings to match legal and corporate recordkeeping policies.

Key Deadlines to Record in the LOI

Include explicit calendar dates for every milestone to avoid ambiguity during negotiation and diligence.

Exclusivity Period:

Define the start and end date for any no-shop clause to limit competing offers.

Target Close Date:

Record the intended closing date for funding or signing of the binding agreement.

Due Diligence Window:

Specify the number of days allocated for financial, legal, and technical review.

Regulatory Deadline:

Note dates for filings or approvals tied to regulatory authorities, if applicable.

Expense Reimbursement Cutoff:

Set a last date for cost claims tied to diligence or third-party reports.

Typical Milestones from LOI to Binding Agreement

A milestone timeline helps track interdependent tasks and responsible parties during the deal lifecycle.

01

LOI Execution

Parties sign the LOI and confirm key commercial terms.

02

Due Diligence

Buyers conduct financial, legal, and operational reviews.

03

Definitive Agreement Drafting

Legal teams prepare and negotiate the binding financing documents.

04

Closing

Conditions are satisfied, funds are transferred, and the definitive agreement is executed.

Common Mistakes When Preparing a Financial Project LOI

Leaving binding and non-binding provisions undefined, which can create unintended contractual obligations and commercial disputes.
Failing to identify the authorized signatory, producing signature delays or questions about corporate authority during closing.
Omitting milestone dates or specifying open-ended timeframes that permit protracted diligence and increase deal cost.
Neglecting confidentiality or expense allocation language, which can produce cost disputes or premature disclosure of sensitive information.

Practical Risks and Legal Consequences of an Incorrect LOI

Unintended Obligation: May create binding commitments

Reputational Risk: Can harm future negotiations

Expense Exposure: Cost recovery may be limited

Regulatory Delay: Missing approval windows

Tax Implication: Misstated funding triggers reporting

Enforceability: Ambiguity weakens court defenses

eSignature Pricing Snapshot for LOI Workflows (signNow listed first)

Compare baseline pricing and a few key plan characteristics across common eSignature vendors to inform procurement decisions for LOI execution.

	signNow	DocuSign	Adobe Sign	PandaDoc	HelloSign
Starting Price	$8/user/mo	$15/user/mo	$14/user/mo	$19/user/mo	$15/user/mo
Free Trial	7-day trial	Varies by vendor	Varies by vendor	Varies by vendor	Varies by vendor
Bulk Send	Yes (Business Premium)	Varies by plan	Varies by plan	Yes	Varies by plan
Audit Trail	Yes	Yes	Yes	Yes	Yes
HIPAA Compliant	Yes	Varies by plan	Varies by plan	Varies by plan	Varies by plan
Envelope Cap	No cap	100 envelopes/user/year	Varies	Varies	Varies

Frequently Asked Questions About Financial Project LOIs

Answers to common legal and practical questions that arise when preparing or relying on an LOI for a financing or project investment.

Need help? Contact support

Is an LOI legally binding?
An LOI can contain both binding and non-binding provisions; clearly label which clauses are intended to bind the parties. ESIGN (15 U.S.C. ch. 96) and state law (UETA where adopted) support electronic execution when intent, consent, attribution, and retention are present.
Can an LOI be signed electronically?
Yes. Electronic signatures are valid under the ESIGN Act and UETA when the transaction is not an exception to e-signature laws. Ensure the platform documents intent, consent, and preserves a retrievable record.
Do I need notarization or witnesses for an LOI?
Not typically required for LOIs, but specific transaction elements (e.g., deeds, powers of attorney) may require notarization. If a notary or witnesses are requested, follow state rules or use a compliant RON provider where available.
How do I revoke or cancel an LOI?
Revocation depends on the LOI wording and whether any provisions are binding. Absent a binding clause, provide clear written notice and follow agreed termination steps. Consult counsel if obligations or reliance damages are possible.
Who should sign the LOI on behalf of an entity?
An authorized officer or person with delegated authority should sign. Verify corporate authorization with a board resolution or power of attorney if the signatory is not an officer.
What supporting documents should accompany an LOI?
Common attachments include NDAs, indicative budgets, preliminary term sheets, cap tables, and limited due diligence items. Label exhibits clearly and reference them in the LOI body.

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