Document background
The Letter of Intent to Sell Business is a crucial preliminary document in New Zealand business transactions, typically used when a potential buyer has expressed serious interest in purchasing a business but before entering into a binding sale and purchase agreement. It serves to document the parties' preliminary understanding and outline key terms of the proposed transaction. While generally non-binding (except for specific provisions like confidentiality and exclusivity), it demonstrates commitment to the negotiation process and provides a framework for further discussions. The document is governed by New Zealand law and must consider various legislative requirements, including the Contract and Commercial Law Act 2017, Fair Trading Act 1986, and potentially the Overseas Investment Act 2005 if foreign investors are involved. It typically precedes more detailed due diligence and the drafting of definitive agreements.
