LETTER OF INTENT
(Non-Binding — Prospective Sale of Goods)
________
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Date: ________
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________
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RE: Non-Binding Letter of Intent Regarding the Proposed Sale of Goods
Dear ________:
This letter of intent (this orth a written expression of the parties' mutual interest, following our discussion on ________, in negotiating a definitive contract for the purchase and sale of goods (a "Definitive Agreement"). Except as expressly set forth in § 7 (Binding Provisions) below, this LOI is not intended to be, and shall not constitute, a binding or enforceable contract.
The proposed parties to the Definitive Agreement are:
________, a ________ organized under the laws of ________ (the "Seller"), with a principal place of business at:
________
and ________, a ________ organized under the laws of ________ (the "Buyer"), with a principal place of business at:
________
The Seller and the Buyer are referred to herein individually as a "Party" and collectively as the "Parties."
§ 1. Purpose; Non-Binding Nature. This LOI summarizes certain principal terms presently contemplated by the Parties and serves as a preliminary framework for continued good-faith negotiation. The terms set forth herein are subject in all respects to the negotiation, execution, and delivery of a mutually acceptable Definitive Agreement. No Party shall be under any obligation whatsoever with respect to the proposed transaction unless and until a Definitive Agreement is executed and delivered by authorized representatives of both Parties, and then only to the extent set forth therein. This LOI shall expire and become void if not accepted within the following period: ________.
§ 2. Prospective Transaction. The transaction contemplated by the Parties (the "Prospective Transaction") is described as follows:
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§ 3. Goods; Quantity. The goods contemplated for purchase and sale, together with the quantity thereof, are:
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§ 4. Price and Fees. The contemplated price, payment terms, and applicable fees for the goods are as follows:
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§ 5. Delivery; Risk of Loss. The contemplated delivery terms, including the delivery location, schedule, and applicable shipping terms (e.g., F.O.B. or other Incoterms® designation under which risk of loss passes), are as follows:
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§ 6. Right of Inspection. Consistent with the Buyer's right of inspection under U.C.C. § 2-513, the Buyer shall have a reasonable opportunity to inspect the goods prior to final payment and acceptance. In the event the goods are found to be nonconforming, the Parties contemplate addressing the matter as follows:
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§ 7. Binding Provisions. Notwithstanding any other provision of this LOI, the Parties acknowledge and agree that § 7 (Binding Provisions), § 8 (Confidentiality), § 9 (Exclusivity), § 10 (Expenses), and § 12 (Governing Law; Venue) are intended to be, and shall constitute, legally binding and enforceable obligations of the Parties. All other provisions of this LOI are non-binding statements of present intent only.
§ 8. Confidentiality. Each Party agrees to hold in strict confidence the existence and terms of this LOI, the Prospective Transaction, and all non-public information disclosed by the other Party in connection herewith, and to use such information solely for the purpose of evaluating and negotiating the Prospective Transaction. The foregoing shall not apply to information that (a) is or becomes publicly available through no breach by the receiving Party; (b) was lawfully in the receiving Party's possession prior to disclosure; or (c) is required to be disclosed by law, regulation, or valid legal process, provided that reasonable advance notice is given to the disclosing Party where legally permissible.
§ 9. Exclusivity. For a period of ________ following the date of acceptance of this LOI, the Parties agree to negotiate the Definitive Agreement exclusively and in good faith with one another, and shall not solicit, initiate, or entertain any competing proposal with respect to the goods that are the subject of the Prospective Transaction.
§ 10. Expenses. Each Party shall bear its own costs and expenses, including legal and advisory fees, incurred in connection with the negotiation and preparation of this LOI and the Definitive Agreement, whether or not the Prospective Transaction is consummated.
§ 11. No Reliance; No Obligation to Proceed. Each Party acknowledges that, except for the binding provisions identified in § 7, neither Party is relying upon any statement, representation, or course of conduct of the other in connection with this LOI, and that either Party may, in its sole discretion and for any reason or no reason, terminate negotiations at any time prior to the execution of a Definitive Agreement, without liability to the other Party.
§ 12. Governing Law; Venue. This LOI, and the binding provisions hereof, shall be governed by and construed in accordance with the laws of the State of ________, including its Uniform Commercial Code, without regard to its conflict-of-laws principles. The Parties consent to the exclusive jurisdiction and venue of the state and federal courts located in ________ for any dispute arising out of or relating to the binding provisions of this LOI.
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Next Steps. If the terms outlined in this LOI are agreeable to you, please indicate your acceptance by signing and dating below and returning an executed copy to us. Your signature shall evidence your intent to proceed with good-faith negotiations toward a Definitive Agreement based upon the terms set forth herein. Upon such acceptance, we will arrange for the Definitive Agreement to be prepared. As noted above, the terms set forth herein shall become void if not accepted within the following period: ________.
Sincerely,
______________________________
________
Title: ________
On behalf of: ________
Date: ________
ACKNOWLEDGED, AGREED, AND ACCEPTED:
______________________________
________
Title: ________
On behalf of: ________
Signature: _________________________
Date: ________