A letter of intent (LOI) is a key aspect of the dealmaking process for many business owners. Executing a letter of intent signals the plan for one business to engage in a transaction with another while including details of the upcoming deal. Certain factors could lead to costly errors when writing an LOI for a pending transaction, such as in the case of a business acquisition.
A San Antonio letter of intent lawyer could ensure all transaction terms are clearly spelled out upfront. The experienced attorneys at Begum Pelaez-Prada PLLC could help you establish key benchmarks and deadlines in your letter of intent, while also ensuring it meets all necessary state requirements.
A detailed letter of intent should be executed for any transaction involving a proposed merger and acquisition. These documents are also instrumental when planning other types of business transactions, including:
An LOI is a non-binding document similar to a contract. Two parties establish an LOI in anticipation of a final, binding agreement for a particular business deal but have not finalized all the details yet.
There are many benefits to using a letter of intent. Besides establishing vital terms of a transaction, the agreement allows both parties to:
It is important to work with a San Antonio attorney who is deeply familiar with drafting letters of intent to ensure that document language is crafted properly. Otherwise, the LOI could contain provisions that unintentionally undermine your business interests.
Certain key terms of an LOI can be binding, such as a non-disclosure agreement. This document is designed to initiate the due diligence process and other initial stages in the transaction. Generally, a letter of intent starts with a description of the proposed business deal. This could include the names and addresses of the involved parties, information about the property or business, and other details of the deal. If the transaction involves a sale, the letter of intent should include the asking price, rent amount, or loan amount for the property.
The document should contain planned steps for due diligence, such as requesting certain documents for verification. Contingencies should be outlined to the completion of the deal, such as a buyer completing a financing arrangement before closing a real estate transaction.
The LOI often includes a specific timeline by which certain steps in the negotiation process must be completed. Depending on the nature of the deal, certain binding clauses, such as a non-disclosure agreement, non-solicitation agreement, and/or non-compete agreement, may be advisable. Both parties must also sign the letter of intent. Sasha Begum, along with the San Antonio legal team at Begum Peláez-Prada PLLC, could help you mitigate vulnerabilities in the dealmaking process and negotiate an LOI on your behalf.
A detailed and properly negotiated letter of intent can save you time and money down the line. Having a seasoned San Antonio letter of intent lawyer engaged early on in the process can lead to the most well-drafted, favorable end result while establishing a detailed plan of action for the rest of the transaction.
Whether you are the proposed buyer or seller in a prospective merger and acquisition or need to draft an LOI for another purpose, our legal team has extensive experience helping clients through a wide variety of transactions and deals in various industries. Managing partner Sasha Begum has 20 years of experience overseeing domestic and international business transactions of many kinds. Contact Begum Peláez-Prada PLLC to receive your one-on-one legal consultation with a member of our legal team.
