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A Letter of Intent outlines the key terms and basic understanding between parties before they create a detailed, formal agreement. Think of it as a roadmap for negotiations - it shows everyone's serious about moving forward but doesn't lock them into final terms yet. In New Zealand business dealings, these letters help keep early discussions clear and focused.

While not usually legally binding (except for specific clauses like confidentiality), Letters of Intent play a vital role in complex transactions like business sales, property developments, and major contracts. They save time and money by getting the main points sorted early, following Kiwi commercial practice of good faith negotiations. Smart businesses often have their lawyers review these letters to ensure they're setting the right foundation for the final deal.

Use a Letter of Intent when you're starting serious negotiations for major business deals, especially mergers, acquisitions, or significant property developments. It's particularly valuable in complex transactions where you need to outline key terms before investing time and money in detailed legal documentation.

This tool proves essential when dealing with multiple stakeholders, securing initial board approvals, or applying for financing in New Zealand. For example, property developers often need Letters of Intent to show banks their development plans have serious buyers lined up. Commercial tenants use them to demonstrate their commitment while negotiating detailed lease terms. They're also vital in joint ventures where parties need to agree on basic principles before extensive due diligence begins.

• Commercial Lease Letter Of Intent: Used in property negotiations to outline proposed lease terms and conditions before finalizing a formal lease agreement.
• Employment Letter Of Intent: Outlines preliminary employment terms between an employer and potential hire, common in executive recruitment.
• Professional Letter Of Interest: A more general business document used for initial partnership proposals or business opportunities.
• Graduate Letter Of Intent: Specifically formatted for academic or entry-level professional positions, often including educational background.
• Expression Letter Of Interest: A less formal version used to initiate discussions or express preliminary interest in business opportunities.

• Business Owners and Executives: Initiate and sign Letters of Intent for mergers, acquisitions, or major business deals, often working closely with their legal teams.
• Property Developers: Use these letters to secure preliminary agreements with potential tenants, investors, or land owners before finalizing complex property deals.
• Corporate Lawyers: Draft and review the letters to ensure legal compliance and protect their clients' interests during negotiations.
• Commercial Real Estate Agents: Facilitate Letters of Intent between landlords and potential tenants for significant commercial leases.
• Company Directors: Review and approve these letters as part of their governance responsibilities, especially for major transactions requiring board oversight.

• Basic Details: Gather full legal names, addresses, and contact information for all parties involved in the agreement.
• Deal Specifics: Document key terms, proposed pricing, timelines, and any special conditions essential to the transaction.
• Due Diligence: Compile relevant financial statements, property details, or business records needed to support the proposed terms.
• Confidentiality Needs: Identify which aspects require non-disclosure provisions and for how long they should apply.
• Template Selection: Use our platform's NZ-compliant templates to ensure all mandatory elements are included correctly.
• Internal Approvals: Check signing authority requirements and obtain necessary management or board approvals before finalizing.

• Opening Statement: Clear identification of all parties and a brief description of the proposed transaction or relationship.
• Key Terms: Main commercial points, including pricing, timeline, and essential conditions of the proposed agreement.
• Binding Provisions: Specifically marked sections that are legally enforceable, typically confidentiality and exclusivity clauses.
• Non-Binding Declaration: Clear statement that the overall document is not a final contract.
• Duration: Specific timeframe for negotiations and expiry date of the letter.
• Governing Law: Statement that New Zealand law applies and which court has jurisdiction.
• Signature Block: Full names, titles, and dates for authorized signatories from each party.

A Letter of Intent differs significantly from an Engagement Letter, though both documents help establish business relationships. The key distinctions affect when and how you should use each one.

• Legal Binding Nature: Letters of Intent are mostly non-binding frameworks for future negotiations, while Engagement Letters create immediate legal obligations between parties.
• Timing and Purpose: Letters of Intent come early in discussions to outline potential deals, whereas Engagement Letters formalize an immediate working relationship, especially for professional services.
• Detail Level: Letters of Intent contain broad terms and basic principles, while Engagement Letters specify detailed scope, fees, and deliverables.
• Duration: Letters of Intent typically expire once formal agreements are signed, but Engagement Letters remain active throughout the service period.