Document background
The Letter of Intent Non Binding is a crucial preliminary document in Canadian business transactions, used when parties wish to formalize their initial understanding while maintaining flexibility in negotiations. It serves as a roadmap for more detailed agreements while explicitly stating its non-binding nature under Canadian law. This document type is particularly valuable in complex transactions where parties need to outline key terms, conduct due diligence, and establish a framework for negotiations before committing to legally binding obligations. The LOI typically precedes definitive agreements and is especially common in mergers, acquisitions, joint ventures, and significant commercial arrangements. While primarily non-binding, certain provisions such as confidentiality and exclusivity can be made explicitly binding, making it a versatile tool in Canadian business negotiations.
