Document background
A Commercial Purchase Letter of Intent is commonly used in Australian business transactions as a preliminary step before entering into a formal purchase agreement. It is typically employed when parties have reached a general understanding of key commercial terms but need to formalize their intent to proceed with detailed negotiations and due diligence. The document serves multiple purposes: it demonstrates commitment to the transaction, outlines key commercial terms, establishes a framework for negotiations, and addresses preliminary matters such as confidentiality and exclusivity. While primarily non-binding, certain provisions may create legal obligations under Australian law. This document is particularly useful in complex commercial purchases where parties need to establish clear parameters before investing significant time and resources in due diligence and detailed contract negotiations.
