Free Letter of Intent (LOI) Template (2026)

This Letter of Intent (LOI) template provides a clear, professional framework for documenting the principal terms of a proposed business transaction. It is designed for use when parties want to record agreed-upon deal terms and begin due diligence before negotiating a final definitive agreement. Use this LOI when parties wish to outline key commercial terms (such as purchase price, closing conditions, exclusivity, and timing) while reserving the parties' rights pending execution of a definitive agreement. The template includes common binding provisions (e.g., confidentiality and exclusivity), as well as non-binding provisions regarding the transaction structure and intent to negotiate in good faith.

What is a Letter of Intent (LOI)?

A Letter of Intent (LOI) is a short document that outlines the key terms and mutual understanding between parties before a formal contract is drafted. Its legal purpose is to record preliminary agreements, set negotiation boundaries, and identify conditions for a deal; it is commonly used by businesses, buyers, sellers, investors, and landlords during transactions.

Key Components

A legally effective Letter of Intent (LOI) must include the following elements:

Identification of the parties and clear statement of the transaction or purpose
Description of principal commercial terms (price, consideration, payment structure, or equity split)
Statement about binding vs. non‑binding provisions, specifying which clauses (e.g., confidentiality, exclusivity) are intended to be binding
Confidentiality and non‑disclosure obligations
Exclusivity or no‑shop clause and defined negotiation/time limits
Conditions precedent and due diligence requirements that must be satisfied to proceed
Termination rights, timelines, and signatures of authorized representatives

When to Use This Template

When a buyer and seller agree on major deal terms for an acquisition but need time to complete due diligence and draft a purchase agreement
At the start of commercial lease negotiations to lock in fundamental terms (rent, term, use) while the landlord and tenant finalize the full lease
When investors and a startup agree on key financing terms before preparing definitive investment agreements and capitalization documents
When two businesses plan a joint venture or strategic partnership and want a written outline of roles, contributions, and milestones before final contracts
When negotiating the sale of assets or business units to document agreed valuation, included assets, and conditions before preparing the asset purchase agreement

Frequently Asked Questions

Is a letter of intent legally binding?

A Letter of Intent can be partly binding: typically confidentiality, exclusivity, and governing law clauses are written as binding, while the main transaction terms are usually non‑binding until a definitive agreement is signed. Clear language is essential—state which provisions are intended to bind and consult counsel if you need enforceability.

What should be included in a letter of intent?

Include the parties’ names, a concise description of the transaction, key economic terms (price or consideration), timelines and deadlines, confidentiality or exclusivity clauses, conditions precedent/due diligence, and a binding/non‑binding statement plus signatures. These elements reduce ambiguity and guide preparation of the final agreement.

How do you write a letter of intent?

Start with a clear statement of purpose, list the agreed commercial terms and any conditional steps (due diligence, approvals), specify which provisions are binding, add timelines and termination rights, and finish with signatures. Keep it concise and avoid committing to final legal language that belongs in definitive agreements.

How long is a letter of intent valid?

Validity depends on the timelines specified in the LOI—common terms range from 30 to 120 days while parties complete due diligence and negotiate definitive documents. If no expiration is stated, enforceability can be uncertain, so include a clear expiration or review date.

Letter of Intent (LOI)

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