100. Letters of Intent from BuyersBy Roger Bryan
Your company has taken the decision to buy a commodity or a company and have finalized terms and conditions of the deal. The next step is to prepare a letter, which is called letter of intent from buyers. This letter can be binding or non-binding on the both parties, depending upon the wordings in the letter.
The document specifies the major points of a business deal, whether it is a small one or a big one. These points include important target dates of business deal and payment method. It also includes agreed price, details of assets and liability, validity of contracts etc. Essentially, it defines the agreed parameters of the business transaction between the both buyer and seller parties. You have to make it clear, that the letter of intent from buyers is non-binding legally and will be superseded by the purchase or sale agreement.
Otherwise, if there is any problem and you want to back out at the last minute from the sale, the other party can sue you in the court, on the basis of the letter of intent from buyers. The main advantage is that, it shows that the buyer is truly interested in the business transaction.