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Letter of Intent Form

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LETTER OF INTENT

This Letter of Intent is entered into as of Month Day Year (the "Effective Date") by and between Party A Name: , Entity Type: , principal address: ; and Party B Name: , Entity Type: , principal address: .

RECITALS

WHEREAS, Party A and Party B have engaged in preliminary discussions concerning a potential transaction pursuant to which Party A would transfer and Party B would acquire the assets, equity, or rights described as: (the "Transaction");

WHEREAS, the parties desire to set forth certain key terms and the framework for continuing negotiations and to record the parties' understanding as to which provisions are intended to be binding and which are to be non-binding during the negotiation period;

WHEREAS, the parties intend to proceed promptly to negotiate a definitive agreement containing customary representations, warranties, covenants and conditions to closing applicable to the Transaction.

NOW, THEREFORE, in consideration of the mutual covenants set forth below and other good and valuable consideration, the parties agree as follows:

1. PURPOSE

The purpose of this Letter of Intent is to establish the principal business terms under which the parties will negotiate a definitive acquisition agreement (the "Definitive Agreement") and to identify certain terms that the parties intend to make binding as set forth below.

2. PROPOSED TRANSACTION TERMS

(a) Nature of Transaction: The Transaction is proposed to be a .

(b) Purchase Price: The aggregate purchase price to be paid by Party B to Party A shall be $, subject to customary adjustments as set forth in the Definitive Agreement.

(c) Deposit/Earnest Money: At execution of the Definitive Agreement, Party B shall deliver to Party A a deposit in the amount of $, to be held in escrow and applied to the purchase price at closing in accordance with escrow instructions to be agreed.

(d) Target Closing Date: The parties anticipate closing on or before Month Day Year , subject to satisfaction of the conditions precedent set forth below.

3. DUE DILIGENCE

Party B shall be granted a period of days from the Effective Date (the "Due Diligence Period") to conduct such inspections, reviews and investigations of Party A and the Transaction as Party B reasonably deems necessary. Party A agrees to provide access to financial, operational, legal and other material information and to make key personnel available for interviews and reasonable site inspections.

4. CONFIDENTIALITY

The parties acknowledge that information exchanged in connection with the Transaction is confidential. The parties agree to maintain in confidence all non-public information received from the other party and to use such information solely for the purpose of evaluating and negotiating the Transaction. This obligation of confidentiality shall survive termination of this Letter of Intent for a period of months, except for information that is or becomes public through no breach by the recipient or is required to be disclosed pursuant to applicable law or court order.

5. EXCLUSIVITY / NO-SHOP

For a period of days from the Effective Date, Party A shall not, directly or indirectly, solicit, initiate, assist or encourage offers or negotiations with respect to any alternative transaction that would reasonably be expected to interfere with the Transaction without the prior written consent of Party B. Any breach of this exclusivity obligation shall entitle Party B to pursue equitable relief in addition to any other remedies available at law or in equity.

6. BINDING AND NON-BINDING PROVISIONS

Except as expressly set forth in this Section, this Letter of Intent is not intended to create, and does not create, any legally binding obligation on either party to consummate the Transaction. The parties acknowledge and agree that the following provisions shall be binding and enforceable: Section 4 (Confidentiality), Section 5 (Exclusivity / No-Shop), Section 10 (Notices) to the extent they impose continuing obligations, and this Section 6 (Binding and Non-Binding Provisions). All other provisions are intended solely as a statement of the parties' present intentions and are subject to the negotiation and execution of a Definitive Agreement.

7. CLOSING CONDITIONS

The obligations of the parties to close the Transaction shall be subject to customary conditions precedent, including but not limited to: (a) the completion of due diligence to Buyer’s reasonable satisfaction; (b) receipt of all required third party consents and governmental approvals; (c) the accuracy of the parties' representations and warranties in the Definitive Agreement as of closing; and (d) no injunctions or prohibitions preventing consummation of the Transaction.

8. REPRESENTATIONS; NO RELIANCE

Each party represents that it has the authority to enter into this Letter of Intent and that the person signing has been duly authorized. Except as expressly stated in any executed Definitive Agreement, neither party makes any representation or warranty, express or implied, as to any matter, and each party hereby disclaims reliance upon any representation or statement not contained in this Letter of Intent.

9. EXPENSES

Except as otherwise agreed in writing, each party shall bear its own fees and expenses (including legal, accounting and advisory fees) incurred in connection with the negotiation and preparation of the Definitive Agreement and any ancillary documents.

10. NOTICES

Notices shall be in writing and shall be deemed given when delivered personally, sent by nationally recognized overnight courier service, or three business days after deposit in the United States mail, postage prepaid, return receipt requested, to the addresses set forth above or to such other address as either party shall have furnished to the other in writing in accordance with this Section.

11. GOVERNING LAW

This Letter of Intent shall be governed by and construed in accordance with the laws of the state of , without regard to its conflict of laws principles.

12. ENTIRE AGREEMENT

This Letter of Intent constitutes the entire agreement between the parties with respect to the subject matter hereof and supersedes all prior discussions, negotiations and understandings between the parties with respect thereto, except that any executed Definitive Agreement will supersede this Letter of Intent as to the matters addressed therein.

13. SEVERABILITY

If any provision of this Letter of Intent is held to be invalid or unenforceable, the remaining provisions shall remain in full force and effect and shall be construed so as to best effectuate the parties' intent.

14. AMENDMENT; WAIVER; COUNTERPARTS

This Letter of Intent may be amended, modified or supplemented only by a written instrument signed by both parties. No waiver of any provision hereof shall be effective unless in writing and signed by the party against whom enforcement is sought. This Letter of Intent may be executed in counterparts, each of which shall be an original and all of which together shall constitute one and the same instrument.

15. TERMINATION

This Letter of Intent shall terminate upon the earlier of: (a) execution of a Definitive Agreement by the parties; (b) written notice by either party to the other of its intent not to proceed; or (c) expiration of the exclusivity period specified in Section 5. Termination of this Letter of Intent shall not relieve either party of any liability for breach of any provision that, by its terms, is intended to survive termination.

ADDITIONAL PROVISIONS

Party A:

By:

Date:

Party B:

By:

Date:

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What a Letter of Intent Form Is and How it’s Used

A Letter of Intent Form (LOI) is a short written statement that records preliminary terms between parties considering a transaction, such as purchase, lease, investment, or service agreements. LOIs typically outline core commercial points — parties, price range, basic obligations, exclusivity periods, and deadlines — without finalizing a complete contract. Some LOIs are expressly non‑binding while others contain binding provisions (confidentiality, exclusivity, or breakup fees). In the United States, parties frequently exchange LOIs early in negotiations to set expectations and structure due diligence before drafting definitive agreements.

Why a Clear Letter of Intent Form Matters

A well‑drafted LOI clarifies priorities, reduces negotiation time, and documents mutual expectations while preserving flexibility for a final contract. It can also allocate costs and set deadlines that protect each party during due diligence. From a legal perspective, explicit language can control whether particular clauses are binding, and electronic execution is generally valid under the ESIGN Act (15 U.S.C. ch. 96) and state UETA laws.

Why a Clear Letter of Intent Form Matters

Who Typically Prepares and Signs a Letter of Intent

LOIs are used across deal sizes and sectors; several roles commonly prepare or approve them.

  • Buyers and investors preparing initial offer summaries for sellers or portfolio companies.
  • Sellers, property owners, or management teams responding with preferred commercial terms and contingencies.
  • Corporate development, real estate brokers, or outside counsel coordinating language and internal approvals.

Identify the appropriate preparer and signer early to avoid delays and ensure the LOI reflects internal authority and approvals.

Primary Signer Profiles

Authorized Signatory

Typically a C‑level executive, controller, or authorized officer whose signature binds the entity. Confirm delegated authority and any board or committee approvals before signing to avoid later disputes over capacity.

Legal Reviewer

In-house counsel or outside counsel often prepares or reviews LOIs to ensure binding provisions are limited and that confidentiality, exclusivity, and termination clauses are clear and enforceable under applicable law.

Essential Sections to Include in a Professional Letter of Intent Form

A practical LOI organizes core deal terms so recipients can quickly assess whether to proceed. Include discrete sections that map to subsequent contract provisions and identify any binding obligations explicitly.

Parties

Identify full legal names and entity types for each party, including operating addresses and the role each party will play in the proposed transaction; avoid trade names alone to prevent ambiguity.

Transaction Summary

Describe the proposed transaction in clear terms — purchase price or rent range, asset or share transfer, payment schedule, and any earnout mechanics or adjustments contemplated.

Key Conditions

List critical conditions precedent such as satisfactory due diligence, financing, third‑party consents, regulatory approvals, and specific deliverables with associated timelines.

Confidentiality

State whether confidentiality provisions are binding and specify permitted disclosures, duration, and consequences for breach; reference any separate NDA already in effect.

Exclusivity / No‑Shop

If included, define the exclusivity period, scope (limited to specified proposals), and remedies or fees for breach to avoid differing expectations.

Binding Clauses

Identify which clauses are meant to be binding (for example, confidentiality, exclusivity, fees) and include signature blocks and applicable governing law language to reduce uncertainty.

Step-by-Step: How to Prepare and Execute an LOI

Follow a standard sequence to prepare, approve, and circulate an LOI so negotiation and diligence proceed efficiently.

  • 01
    Draft Terms: List core commercial points and any binding clauses in plain language.
  • 02
    Internal Review: Obtain approvals from legal, finance, and authorized signers before distribution.
  • 03
    Send to Counterparty: Transmit the LOI with clear response deadlines and contact details for questions.
  • 04
    Execute and Track: Collect signatures, record execution dates, and store the final LOI with supporting documents.

How to Customize an LOI Form for Online Workflows

Configure online templates and routing to match your internal approval, signing order, and authentication needs.

Field Configuration
Signature Order Set sequential or parallel signing based on required approvals
Authentication Level Choose email link, SMS code, or advanced verification for signer identity
Conditional Fields Show or hide clauses based on transaction type (asset vs share)
Retention Policy Automatically archive executed LOIs to a secure repository

Where to Send or File a Letter of Intent

LOIs are typically exchanged between the parties and their advisors; filing with a government office is not required in most transactions.

  • Counterparty: Deliver the executed LOI to the opposing party and confirm receipt.
  • Legal Counsel: Provide counsel with the executed LOI for contract drafting and compliance checks.
  • Deal Repository: Store the LOI in secure contract management or cloud storage for auditability.
  • Lenders / Investors: Share copies with financing sources when LOI terms affect funding commitments.

How eSigning and Distribution Typically Work

Choose an eSignature platform that supports the required authentication, audit trail, and integrations for your workflow.

  • Authentication: Email, SMS, or stronger methods available
  • Integrations: Connects to CRM and cloud storage
  • Export Formats: PDF/A output with embedded audit trail

Typical Deadlines and Response Windows in an LOI

LOIs commonly set a sequence of timeframes to keep negotiations and due diligence on track. Be explicit about when each clock starts and stops.

Offer Expiration:

Specify exact date and time for acceptance or it lapses

Due Diligence Period:

State the number of days and starting event for inspections

Exclusivity Window:

Define the exclusivity term and any extension conditions

Closing Target:

Provide a target closing date or range for final agreement

Termination Notice:

Specify required notice period for withdrawing the LOI

Key Milestones from LOI to Closing

Use a milestone timeline to coordinate internal teams and external advisors through the transaction lifecycle.

01

LOI Execution

Parties sign and date the LOI; triggers subsequent deadlines.

02

Due Diligence

Buyer completes inspections, document review, and third‑party checks.

03

Definitive Agreement

Negotiation and drafting of the final purchase or lease agreement.

04

Closing

Final signatures, fund transfers, and handover of assets.

Common Mistakes to Avoid When Preparing an LOI

  • Using vague language that leaves core economic terms or timelines open to differing interpretations.
  • Failing to state clearly which provisions are binding, thereby creating unintended contractual obligations.
  • Omitting signer capacity details for entities, which can lead to disputes over authority and enforceability.
  • Neglecting to coordinate with financing or landlord consent requirements that may condition the final agreement.

Principal Legal and Commercial Risks

Unintended Contract: Partial binding language may create enforceable obligations
Confidentiality Breach: Unauthorized disclosure can lead to damages or injunctions
Reliance Damages: Counterparty reliance can generate compensable losses
Authority Dispute: Signatory lacked corporate authority; creates voidability risk
Missed Deadlines: Failure to meet timelines can forfeit rights or fees
Incorrect Tax Info: Inaccurate TINs trigger withholding or reporting penalties

Required Information and Common Fields

Party Names: Full legal names
Addresses: Street, city, state, ZIP
Transaction Type: Asset or share sale
Price: Specific amount or range
Deadlines: Dates or day counts
Signatures: Printed name, title, date

Supporting Documents and Export Options

Attach or reference supporting materials that should accompany an LOI and choose file formats that preserve integrity and auditability.

Supporting Docs

Due diligence schedules, financial statements, title reports, proof of authority, and existing NDAs are commonly attached as exhibits to substantiate LOI assertions and speed negotiations.

Signed Copies

Export executed LOIs as tamper‑evident PDF/A with an embedded audit trail to preserve timestamps, signer metadata, and a verifiable signature history for later review.

Editable Templates

Keep a master DOCX or template version for internal use so teams can reuse approved clause language and maintain version control during deal cycles.

Records Export

Store a final package that includes the signed LOI, signatory evidence, and correspondence in your contract management system for compliance and audit purposes.

How to Update or Revise an LOI After Initial Execution

Use an amendment or replacement LOI workflow rather than handwritten changes to preserve clarity and signature integrity.

01

Identify Changes:

List specific terms that require revision and the reason for the change
02

Draft Amendment:

Create a short amendment referencing the original LOI and detailing new wording
03

Obtain Approvals:

Secure internal approvals from the same roles that approved the original LOI
04

Execute Electronically:

Collect signatures using the same eSignature workflow and record the amendment alongside the original LOI
05

Distribute Updated Copy:

Send the fully executed amendment to all parties and advisors
06

Archive:

Store both versions with version metadata for auditability

Real-World Examples of LOI Use

These short examples illustrate common LOI scenarios and how eSignature and clear drafting helped streamline outcomes.

Martin Properties — Real Estate

The team used an LOI to record key deal economics quickly

  • The LOI set a 30‑day exclusivity period
  • By exchanging a signed LOI and digital exhibits, the parties completed due diligence and moved to a purchase agreement in under six weeks, reducing administrative delay and clarifying financing contingencies for the lender.

Optica Ventures — Investment

Optica summarized terms in an LOI before term sheet drafting

  • Confidentiality was expressly binding
  • The LOI allowed both parties to allocate diligence responsibilities clearly, which helped negotiate a final term sheet without reopening foundational commercial terms and preserved the working relationship with minimal counsel hours.

Frequently Asked Questions About Letter of Intent Forms

Answers to common questions about binding effect, eSigning, notarization, and revocation to help you avoid typical pitfalls.


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