Have you ever gone into a conversation with someone and walked away with a completely different takeaway than they had? Sure you have, as have many associates proposing the purchase or sale of a business.
Providing a vital bridge between mere discussions and a binding contract, preliminary agreements such as the term sheet, letter of intent, and memorandum of understanding take vague verbal understandings and spell out the specific details of the agreement. These agreements also move the transaction forward by specifying intent from both parties. Without care and counseling, however, these agreements can become potentially dangerous traps for the unwary.
Learn winning strategies for using these critical preliminary agreements to map out and protect your business interests.
Summary of Contents
Overview and Types of Letters of Intent: Risks, Benefits & the Appropriateness of Each
- Binding Letters of Intent
- Non-Binding Letters of Intent
- Hybrid Letters of Intent
Typical Binding and Non-Binding Provisions in Hybrid Letters of Intent
Representation and Warranty Insurance and Interplay with Letters of Intent Provisions
Use of Alternative Preliminary Documents, Including Samples of Each:
- Memorandums of Understanding
- Term Sheets
- Separate Confidentiality Agreements