Appendix A: Form of Letter of Intent

• Author: Gregory M Stein - Michael D Goodwin - Morton P Fisher Jr
• Pages: 365-367

365

Appendix A

Form of Letter of Intent

Notes: The Letter of Intent, also known as an “LOI” or “Term Sheet,”

is generally prepared by the Purchaser and submitted to the Seller. The

description of the Property need not be a detailed legal description but

should consider any unique aspects of the assets being acquired that may

merit attention. The Deposit often is delivered in stages, with a portion

perhaps due upon execution of the Purchase Agreement and a portion due

upon expiration of the Due Diligence Period. If Due Diligence activities

begin before the parties execute a Purchase Agreement, it would be wise

for them to execute an agreement that addresses the rules governing access

to the Property and confidentiality of any documents that are reviewed.

The amount and allocation of closing costs vary widely from jurisdiction

to jurisdiction, so the parties should consider local custom when address-

ing this issue. The parties should also be careful that they do not inadver-

tently create an obligation to negotiate in good faith or even negotiate at all.

Remember that legal requirements vary from state to state and that this

document will probably need to be modified to comply with the require-

ments of any particular jurisdiction.

[Purchaser Letterhead]

___________, 20__

[Seller] _________________________________

Re: Sale of ______________________________

Dear _____:

This letter of intent (“Letter of Intent”) sets forth the general terms

and conditions upon which , a (and/or

an entity affiliated with it) (“Purchaser”) would purchase the Property

described below from the existing owner (“Seller”). Except as expressly set

forth below, this Letter of Intent does not create any legally binding obliga-

tions upon Seller or Purchaser.

Property: The property (“Property”) consists of fee simple title to the

property commonly known as , including all improve-

ments thereon, all easements, rights of way, and appurtenances thereto,

all fixtures, furnishings, equipment, and other personal property owned

by Seller and used in connection therewith, and all leases, licenses, and

contracts related thereto.

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