Document background
The Letter of Intent Sales document is a crucial preliminary agreement used in Canadian business transactions when parties wish to formalize their initial understanding before proceeding with a detailed sales agreement. It is particularly valuable in complex transactions where parties need to outline key terms and conduct due diligence before committing to a final agreement. This document type typically combines non-binding commercial terms with binding provisions regarding confidentiality and exclusivity. Subject to Canadian federal and provincial laws, the LOI helps parties establish clear expectations, timelines, and frameworks for negotiation while protecting sensitive information exchanged during the process. It serves as a roadmap for the transaction, reducing the risk of misunderstandings and providing a foundation for drafting the final sales agreement.
