Letter of Intent (LOI) Template

[DATE]

[BUYER FULL LEGAL NAME] ("Buyer")
[BUYER ADDRESS]
[BUYER EMAIL]

[SELLER FULL LEGAL NAME] ("Seller")
[SELLER ADDRESS]
[SELLER EMAIL]

Re: Letter of Intent — Acquisition of [BUSINESS LEGAL NAME] ("Business")

Dear [SELLER NAME],

This Letter of Intent ("LOI") sets forth the principal terms and conditions under which Buyer proposes to acquire the Business from Seller. The parties agree to negotiate in good faith toward a definitive purchase agreement consistent with the terms below.

BUSINESS DESCRIPTION: [BUSINESS LEGAL NAME], operating as [DBA if applicable], located at [BUSINESS ADDRESS], engaged in [BRIEF DESCRIPTION OF BUSINESS OPERATIONS].

PROPOSED PURCHASE PRICE: $[AMOUNT] ("Purchase Price"), subject to adjustment as described below.

STRUCTURE: This transaction is structured as a(n) [Asset Purchase / Stock Purchase / Membership Interest Purchase] — [circle one and delete others].

ALLOCATION: The parties will negotiate and agree on the allocation of the Purchase Price among asset classes in accordance with IRS Form 8594 requirements.

ADJUSTMENTS: The Purchase Price shall be adjusted as follows:
- Working capital adjustment: [DESCRIBE METHOD — e.g., "normalized working capital of $[X] based on trailing 12-month average"]
- Inventory adjustment: Inventory to be valued at cost on the closing date; Purchase Price adjusted dollar-for-dollar for any variance from $[TARGET INVENTORY VALUE]
- Accounts receivable: [INCLUDED / EXCLUDED from the acquisition]

CASH AT CLOSING: $[AMOUNT] ([___]% of Purchase Price) payable in immediately available funds at closing.

SELLER NOTE (if applicable): $[AMOUNT] at [___]% annual interest, payable over [___] months, secured by [COLLATERAL DESCRIPTION].

EARN-OUT (if applicable): Up to $[AMOUNT] based on performance metrics described in a separate Earn-Out Schedule. See the BizStackHub Earn-Out Structure Template for a framework.

ESCROW: $[AMOUNT] of the Purchase Price shall be placed in escrow for [___] months as security against indemnification claims, released upon expiration of the indemnification survival period.

DUE DILIGENCE PERIOD: Buyer shall have [30 / 45 / 60 / 90] days from the date of execution of this LOI to complete due diligence ("Due Diligence Period"), which may be extended by mutual written agreement.

SELLER COOPERATION: Seller shall provide Buyer with access to all financial records, tax returns (minimum 3 years), contracts, employee information, intellectual property documentation, customer lists, and other information reasonably requested by Buyer. See the BizStackHub Due Diligence Checklist (Buyer) for the complete list.

CONFIDENTIALITY: All information provided during due diligence shall be treated as confidential and subject to the terms of any Non-Disclosure Agreement signed by the parties.

TERMINATION RIGHT: Buyer may terminate this LOI at any time during the Due Diligence Period, in its sole discretion, without liability to Seller.

EXCLUSIVITY PERIOD: [BINDING] From the date of execution of this LOI through the earlier of (a) the end of the Due Diligence Period plus [15] days, or (b) execution of a definitive purchase agreement, Seller agrees not to solicit, negotiate with, or provide information to any third party regarding the sale of the Business ("Exclusivity Period").

Seller will promptly notify Buyer if any third party contacts Seller regarding a potential acquisition of the Business during the Exclusivity Period.

NOTE: This exclusivity provision is binding and enforceable regardless of whether other terms of this LOI are binding.

The closing of the transaction is subject to satisfaction of the following conditions:

(a) Completion of due diligence to Buyer's satisfaction;
(b) Execution of a definitive purchase agreement acceptable to both parties;
(c) Obtaining all required third-party consents and regulatory approvals;
(d) Landlord consent to lease assignment (if applicable);
(e) Key employee retention agreements, if required by Buyer;
(f) Representations and warranties of Seller being true and correct as of closing;
(g) No material adverse change in the Business between the date of this LOI and closing;
(h) Seller financing commitment (if applicable), in form acceptable to Buyer.

TARGET CLOSING: The parties will use commercially reasonable efforts to close the transaction on or before [TARGET DATE], subject to satisfaction of all conditions to closing.

If the parties have not closed the transaction by [OUTSIDE DATE], either party may terminate this LOI by written notice to the other party, without further obligation (other than surviving confidentiality and no-shop provisions).

TRANSITION PERIOD: Seller agrees to provide transition assistance for [30 / 60 / 90] days following closing, at a rate of $[AMOUNT] per [day / week / month], to transfer operational knowledge, customer relationships, and vendor contacts to Buyer or Buyer's designees. See the BizStackHub Transition Plan Template for a structured framework.

NON-COMPETE: As a condition of closing, Seller will execute a Non-Compete Agreement restricting Seller from competing directly with the Business for [2 / 3 / 5] years within [GEOGRAPHIC AREA]. See the BizStackHub Non-Compete Agreement Template for standard terms.

BINDING PROVISIONS: The following sections of this LOI are binding upon the parties: Exclusivity (Section 5), Confidentiality, and this Section 9.

NON-BINDING PROVISIONS: All other terms and conditions set forth in this LOI are non-binding and constitute only a statement of current intent. Neither party is obligated to complete the transaction until a definitive purchase agreement is fully executed.

This LOI does not constitute an offer capable of acceptance and does not give rise to any binding obligation on either party to consummate the proposed transaction.

GOVERNING LAW: This LOI shall be governed by the laws of [STATE].

EXPENSES: Each party shall bear its own legal, accounting, and other fees and expenses in connection with the transaction.

ENTIRE AGREEMENT: This LOI supersedes all prior discussions and correspondence regarding the proposed transaction.

EXPIRATION: This LOI shall expire if not executed by both parties by [EXPIRATION DATE].

______________________________________
[BUYER SIGNATURE]
[BUYER PRINTED NAME & TITLE]
Date: _______________

______________________________________
[SELLER SIGNATURE]
[SELLER PRINTED NAME & TITLE]
Date: _______________