What Is a Letter of Intent?

A Letter of Intent (LOI) is a legal document in the form of a letter that outlines an understanding between the parties of a deal and can in some cases constitute a binding agreement . It is not, strictly speaking, the contract itself, but a written memorialization of the contract negotiations that the parties have begun to discuss. Alternate Name: Letter of Understanding. This document is sometimes called a "Letter of Intent to Contract" because it is used by the party wishing to have a final contract. It is sent to a potential contract business and includes the terms of the agreement that normally have been previously agreed upon verbally. For this reason, this document is sometimes called a pre-contract. A final contract will incorporate the Contract Letter of Intent and will be a lot more extensive. The goal of your letter is to demonstrate your commitment to the deal and outline the basic terms of the agreement. The templates provided down below will help simplify the process.

Are Letters of Intent Legally Binding?

Although not binding in court, Letters of Intent are treated as precedents to contracts in the United States and are subject to both federal and state laws . This document shows the goodwill of both parties to enter into a negotiation. Depending on the contract, some parts of it may be governed by federal law and some others will be covered by state laws.

How to Write a Letter of Intent?

Sometimes when you intend to purchase a company or part of a company you want to make sure the seller excludes negotiations with another buyer. The Letter of Intent or a memorandum of understanding shows you are serious about the purchase, which helps to block other buyers from making their offers. If you have the basic information about the deal, creating this letter is not difficult. The following is a set of details a Letter of Intent usually contains: The contact information, title, and business name of all parties; The underlying transaction; Prospective purchase details; Liabilities or obligations; Negotiation rights and responsibilities ; Confidentiality provisions; Duration of the letters validity. Needless to say, the letter must be signed, ideally by all the parties involved . Our templates allow you to enter this information into a pre-filled document. The rest of the document is auto-filled when you submit the above information. Remember, that even though most LOIs are not legally binding , there are still consequences for breaking a deal. Your credit history , company value, or actual financial state may be affected, especially if the matter goes to court.

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Letter of Intent Template

Letter of Intent Templates and Samples

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Letter of Intent to Continue to Provide Instruction - Minnesota

United States Legal Forms Minnesota Legal Forms Minnesota Education Department Legal

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Form EF-6 Letter of Intent - Form Reproduction Program - Hawaii, 2023

Legal United States Legal Forms Hawaii Legal Forms Hawaii Department of Taxation

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Tax Software Provider Letter of Intent - Virginia, 2023

Legal Virginia Department of Taxation Virginia Legal Forms United States Legal Forms

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Form 102-4018 Material Site Reclamation Plan or Letter of Intent/Annual Reclamation Statement - Alaska

Legal United States Legal Forms Alaska Legal Forms Alaska Department of Natural Resources

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