A Letter of Intent to Do Business is commonly used in commercial transactions under English and Welsh law when parties wish to formalize their intention to enter into a business relationship before completing detailed negotiations. This document typically precedes more comprehensive agreements and serves to outline key terms, timelines, and expectations. While primarily non-binding, it can include specific binding provisions and helps demonstrate serious intent while protecting both parties during negotiations. The Letter of Intent is particularly valuable in complex transactions where detailed due diligence and negotiations are required.
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1. Date and Parties: Identification of all parties involved and date of the letter
2. Purpose Statement: Clear statement of business intention and proposed relationship
3. Scope: Overview of proposed business arrangement or transaction
4. Timeline: Proposed timeline for negotiation and completion
5. Confidentiality: Statement regarding confidential information handling
6. Non-Binding Nature: Clear statement about which provisions are non-binding
1. Exclusivity: Used when parties want to negotiate exclusively for a period. Include when significant transactions where parallel negotiations would be detrimental
2. Cost Allocation: How costs and expenses will be handled. Include when significant costs might be incurred during negotiations
3. Due Diligence: Framework for information sharing and verification. Include for complex transactions requiring detailed investigation
1. Term Sheet: Key commercial terms and conditions being proposed
2. Timeline Schedule: Detailed breakdown of proposed steps and dates
3. Contact Details: Key personnel and their contact information
Relevant legal definitions
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