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The Letter Of Intent Procurement document is a crucial preliminary instrument in Indonesian business practice, typically used when parties are preparing to enter into significant procurement relationships but need to formalize their intentions before executing definitive agreements. It serves as a roadmap for negotiations while providing certain binding commitments regarding confidentiality and exclusivity. Under Indonesian law, particularly considering the Civil Code and procurement regulations, this document helps establish clear parameters for future negotiations while protecting both parties' interests. The LOI typically includes preliminary terms, conditions, and commercial understanding, though most provisions remain non-binding. It's particularly valuable in complex procurement scenarios where detailed due diligence and extensive negotiations are anticipated, or when regulatory approvals may be required before finalizing the procurement relationship.

1. Letterhead and Date: Official letterhead of the issuing company and date of the LOI

2. Parties: Full legal names and addresses of both the issuing party and the recipient

3. Background: Brief context of the procurement opportunity and previous discussions between parties

4. Definitions: Key terms used in the LOI that require specific definition

5. Purpose and Scope: Clear statement of intention to enter into a procurement relationship and outline of goods/services to be procured

6. Key Commercial Terms: Preliminary agreement on essential terms including estimated quantities, pricing framework, and delivery timeline

7. Duration and Exclusivity: Period for which the LOI is valid and any exclusivity arrangements during negotiations

8. Confidentiality: Obligations regarding the confidential treatment of information exchanged

9. Next Steps: Process and timeline for moving toward a definitive agreement

10. Non-Binding Nature: Clear statement of which provisions are binding and non-binding

11. Governing Law: Specification of Indonesian law as the governing law

12. Signature Block: Space for authorized signatures from both parties