A letter of intent for buying or selling a business, with the binding terms named one by one.

What a Letter of Intent does

A Letter of Intent sets out the principal proposed terms of a business transaction before the parties commit to definitive agreements and full due diligence. Most often that transaction is buying or selling a business, though DealDocs' LOI also covers joint ventures, investments, licensing, distribution arrangements, and real estate.

An LOI is not one binding or non-binding document, it's both at once. Specific provisions bind on signature while the underlying deal, most importantly the price, remains open until definitive agreements are signed. Getting that split wrong, or leaving it unstated, is the single most common defect in real LOIs.

What's typically included

• Transaction Overview — what's being bought or sold, and by whom
• Purchase Price — the proposed price and how it's calculated
• Commercial Terms — payment structure, adjustments, and related deal mechanics
• Due Diligence — what the buyer gets to review, and on what timeline
• Conditions — what has to happen before the deal can close
• Exclusivity — a period during which the seller won't negotiate with anyone else
• Deposit — where included, an amount at risk that signals a serious offer
• Conduct of Business — how the target operates while the deal is pending
• Key Employees, Employee Non-Solicit — retention and poaching protections around the people who make the business work
• Brokers, Expenses — who's owed a fee, and who pays their own costs
• Non-Reliance, Remedies Limitation — what each side can and can't hold the other to before a definitive agreement exists
• Binding vs Non-Binding — the clause that names, provision by provision, what's enforceable today
• Confidentiality, Governing Law and Dispute Resolution — protecting the negotiation itself, and naming a forum if it breaks down

See every one of these clauses defined in plain English →

Is a Letter of Intent legally binding?

Usually only in part. Most LOIs state that the overall proposal, including price, is non-binding while specific sections, commonly confidentiality, exclusivity, expenses, and governing law, bind immediately on signature. A document that never says which is which is one of the most common defects in real LOIs, and it's exactly the gap DealDocs' completeness check looks for. See how binding language actually holds up under the law of the country you're transacting in on our jurisdiction pages below.

Where LOIs go wrong

• Silence on which sections bind, leaving the whole document open to dispute
• No exclusivity period, so the seller stays free to negotiate elsewhere while the buyer pays for diligence
• No deposit terms where a deposit was actually discussed
• Broker fees left unaddressed until they surface at closing
• No clear expiry date on the letter itself

How it works

• Answer a guided interview. Parties, transaction type, price, and governing law.
• Get a free preview. The plain English guide and a completeness check, no account required to see what's included.
• Unlock when you're ready. US$19.99 for the full text, the Word download, and the lawyer memo.

Letter of Intent templates by country

DealDocs maintains LOI templates for 21 countries, each drafted for its own law:

Frequently asked questions