Letters of Intent
Letter of intent also known as LOI is a document which spells out general plans of an individual or company involved in a business deal. It is an initial agreement between two parties for example if a large company plans to buy manufacturing equipment then the letter of intent might contain specific date for proposed sale to take place. In letter of intent you can also include plans related to expansion or downsizing of staff level. Although, letter of intent is not a legal agreement but it is an official letter that can be treated as a demonstration of good faith. These are written contracts but these are not entitled to bind on parties entirely. Letter of intent is basically written to provide tangible proof to investor about deal or potential takeover.
It is a usual activity in business world to make or receive numerous offers for lucrative deals or contract. Although several informal maneuvers never materialize into real agreement but letters of intent have its own benefits. Having letters of intent allows an organization to arrange additional financing or report new development to employees and stockholders.
Letter of intent is written for following reasons:
- To clarify key points of a complex transaction
- To convince parties involved in a contract
- To officially declare current negation of parties in merger or joint venture proposals
- To provide safeguard in case a deal collapses during negotiation
Letter of intent is a formal letter so it should be written carefully. Your letter should be addressed directly to right person and make sure to include accurate name and addresses of reader. Write letter of intent in proper business format to give it a professional touch. Introduce yourself and your organization then state your purpose of writing letter of intent. Draft this letter following proper business format and keep this letter one page in length. Proofread it more than twice before sending it and make its one copy for your own record.
Here I am providing you with sample letter of intent so to escape you from wandering here and there in search of exact format of letter of intent. These letters are designed considering your needs and are free of cost so you can use them as per your requirements.
I hope these letters will be really helpful for you. These letters are given for information purpose only so try to use these letters as guideline only to draft your own unique letter of intent.