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Non-Binding Letter of Intent Template
Clearly summarize proposed deal terms in a flexible, non-binding letter both sides can review before drafting final contracts.
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Non-Binding Letter of Intent Template
[Party A Name or Legal Entity]
[Street Address]
[City, State/Province, ZIP/Postal Code, Country]
Phone: [Phone Number]
Email: [Email Address]
[Date]
[Party B Name or Legal Entity]
[Street Address]
[City, State/Province, ZIP/Postal Code, Country]
Re: Non-Binding Letter of Intent Regarding [Brief Description of Proposed Transaction or Relationship]
Dear [Party B Contact Name or “Sir/Madam”],
This Non-Binding Letter of Intent (“LOI”) sets forth certain preliminary, non-binding terms and conditions under which [Party A Legal Name] (“Party A”) and [Party B Legal Name] (“Party B,” and together with Party A, the “Parties”) propose to explore and negotiate a possible transaction or business relationship as described below (the “Proposed Transaction”).
Except for the provisions expressly identified as binding in Section 8, this LOI is intended as a statement of current intent only and does not create any binding obligation to complete the Proposed Transaction or to enter into any definitive agreement.
1. Parties
1.1 Party A
Name: [Party A Legal Name]
Entity Type: [Corporation / LLC / Partnership / Individual / Other]
Jurisdiction of Organization or Residence: [Jurisdiction]
Address: [Party A Address]
1.2 Party B
Name: [Party B Legal Name]
Entity Type: [Corporation / LLC / Partnership / Individual / Other]
Jurisdiction of Organization or Residence: [Jurisdiction]
Address: [Party B Address]
2. Description of Proposed Transaction
The Parties are discussing a potential transaction or relationship generally described as follows:
Type of Transaction: [For example, product supply arrangement, service agreement, asset purchase, investment, partnership, or other relationship]
Business Purpose: [Short statement of overall purpose or objectives]
Scope: [High-level description of what each Party would provide or receive]
This description is preliminary and for discussion purposes only. The final structure and details, if any, will be set out in one or more definitive written agreements (the “Definitive Agreements”).
3. Key Indicative Terms (Non-Binding)
Subject to due diligence and negotiation of the Definitive Agreements, the Parties currently contemplate the following indicative terms for the Proposed Transaction:
Commercial Terms: [Summary of major commercial points, such as price, fees, revenue share, volume, or consideration formula]
Territory / Market: [Geographic area or customer segment, if applicable]
Term: [Initial term and any potential renewal periods, if applicable]
Deliverables / Services: [High-level description of deliverables, products, or services]
These key terms are non-binding and are provided only as a basis for further discussion and drafting of the Definitive Agreements.
4. Due Diligence and Information Sharing
The Parties anticipate that each may need to review information about the other Party’s business and the Proposed Transaction, which may include financial, technical, legal, operational, or commercial information.
Each Party may request reasonable information necessary to evaluate the Proposed Transaction.
Access, timing, and scope of information will be coordinated between the Parties.
Any confidential information exchanged will be handled in accordance with Section 8.1 and any separate confidentiality or non-disclosure agreement between the Parties.
5. Process and Indicative Timeline
The Parties currently anticipate the following non-binding process and timeline, which may be adjusted by mutual agreement:
Completion of preliminary discussions and due diligence: by [Date]
Preparation of initial draft of the Definitive Agreement(s): by [Date]
Negotiation and finalization of the Definitive Agreement(s): by [Date]
Target date for signing the Definitive Agreement(s): on or about [Date]
The Parties will use commercially reasonable efforts to progress discussions in good faith, recognizing that either Party may decide not to proceed, consistent with the non-binding nature of this LOI.
6. Costs and Expenses
Each Party will be responsible for its own costs and expenses incurred in connection with this LOI and the evaluation, negotiation, and documentation of the Proposed Transaction, including any fees for legal, financial, or other professional advisors, unless otherwise agreed in writing.
7. No Agency, Partnership, or Exclusivity (Unless Expressly Stated)
This LOI does not create any agency, partnership, joint venture, or other legal relationship between the Parties, and does not grant either Party authority to bind the other, except as may be expressly provided in any Definitive Agreement signed by the Parties.
Unless the Parties expressly agree in Section 8.2 or in a separate written agreement:
Neither Party is required to deal exclusively with the other Party; and
Each Party remains free to explore similar transactions or relationships with third parties.
8. Binding and Non-Binding Provisions
8.1 Non-Binding Provisions
The Parties acknowledge and agree that the following provisions of this LOI are non-binding and do not create any enforceable obligation:
Section 2 (Description of Proposed Transaction);
Section 3 (Key Indicative Terms);
Section 4 (Due Diligence and Information Sharing), except for any express confidentiality obligations;
Section 5 (Process and Indicative Timeline);
Section 6 (Costs and Expenses), to the extent consistent with applicable law;
Section 7 (No Agency, Partnership, or Exclusivity), except where otherwise specifically designated as binding; and
Any term describing the Proposed Transaction itself, including any references to price, scope, or timing.
The Parties are not obligated to proceed with the Proposed Transaction, to sign any Definitive Agreement, or to complete any transaction unless and until they enter into such Definitive Agreement(s).
8.2 Binding Provisions
The Parties intend that the following provisions of this LOI will be binding once this LOI is signed and delivered by both Parties:
Confidentiality: Each Party will keep the terms of this LOI and any non-public information received from the other Party confidential and will use such information only for evaluating the Proposed Transaction, subject to any separate confidentiality agreement and to any legal or regulatory disclosure obligations.
Governing Law and Dispute Resolution (Section 9);
This Section 8.2 itself; and
Any specific exclusivity or “no-shop” provision expressly written here:
Exclusivity (optional, if agreed): [Text of any exclusive dealing or no-shop commitment, including duration and scope].
All other provisions are intended to be non-binding statements of intent only.
9. Governing Law and Dispute Resolution (Binding)
This LOI, to the extent of the binding provisions described in Section 8.2, will be governed by and construed in accordance with the laws of:
Governing Law: [State/Province, Country]
Any dispute arising out of or relating to the binding provisions of this LOI will be resolved in:
Dispute Resolution Forum: [Court or Arbitration Forum and Location]
10. Expiration
If this LOI is not signed by both Parties on or before:
Expiration Date: [Expiration Date]
it will be of no further force or effect, unless extended or renewed in writing signed by both Parties.
11. Entire Understanding (LOI Stage)
This LOI sets out the Parties’ current understanding with respect to the subject matter described above and supersedes prior written or oral statements about the Proposed Transaction at this preliminary stage. Any future Definitive Agreement(s) will replace and supersede this LOI as to the matters covered therein.
12. Signatures
If the general terms of this LOI are acceptable as a preliminary, non-binding framework for further discussions, please sign below to indicate your agreement to the binding provisions in Sections 8.2 and 9 and your acknowledgment of the non-binding nature of the remaining terms.
Party A
[Party A Legal Name]
By: _______________________________
Name: [Authorized Signatory Name]
Title: [Title]
Date: [Date]
Party B
[Party B Legal Name]
By: _______________________________
Name: [Authorized Signatory Name]
Title: [Title]
Date: [Date]
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Learn more about
Non-Binding Letter of Intent Template
Click below for detailed info on the template.
For quick answers, scroll below to see the FAQ.
Click below for detailed info on the template.
For quick answers, scroll below to see the FAQ.
NON-BINDING LETTER OF INTENT TEMPLATE FAQ
What is a non-binding letter of intent?
A non-binding letter of intent (LOI) is a document where parties outline the main business terms of a proposed deal, but state that they are not yet legally obligated to complete the transaction. It captures intent and expectations while leaving room for due diligence and final contract negotiation.
When should you use a non-binding LOI?
Use a non-binding LOI when the parties agree in principle on key terms — such as price, scope, contributions, or timeline — but still need to perform due diligence, obtain approvals, and negotiate a detailed agreement. It is common for partnerships, investments, asset sales, joint ventures, and service arrangements.
What should a non-binding letter of intent include?
A clear non-binding LOI usually identifies the parties, describes the proposed transaction or relationship, summarizes key commercial terms, outlines the process and timeline for due diligence and definitive agreements, and explains which provisions (if any) are intended to be binding, such as confidentiality or exclusivity.
Is a non-binding LOI ever partially binding?
Yes. Even if the main business terms are non-binding, the parties can agree that some sections — such as confidentiality, exclusivity (no-shop), costs, or governing law — are legally binding. The LOI should clearly separate binding provisions from non-binding ones to reduce confusion.
Does a non-binding LOI replace a final contract?
No. A non-binding LOI is typically a roadmap, not the final contract. The detailed rights and obligations of the parties are contained in later definitive agreements (for example, a purchase agreement, services agreement, investment agreement, or joint venture agreement).
Can AI Lawyer help me customize this non-binding LOI template?
Yes. AI Lawyer can help you adapt this Non-Binding Letter of Intent template to your situation by adjusting the description of the transaction, key terms, binding provisions, and timeline while keeping the letter clear and consistent. You still choose the final terms and remain responsible for any legal review and signatures.
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