Document background
The Letter of Intent to Purchase Business is a crucial preliminary document in Swiss business acquisitions, typically used during the initial stages of a transaction when parties have agreed in principle to proceed with negotiations but before conducting detailed due diligence. This document, governed by Swiss law, particularly the Swiss Code of Obligations, serves to memorialize the parties' intentions and establish key commercial terms while maintaining flexibility for final negotiations. While mostly non-binding, it commonly includes binding provisions for confidentiality, exclusivity, and access to information. The LOI helps structure the transaction process, protect parties' interests during negotiations, and provide a roadmap for reaching a definitive agreement, making it an essential tool in Swiss M&A practice.
