{"componentChunkName":"component---src-templates-blog-post-ts","path":"/blog-bite-when-is-a-letter-of-intent-binding/","result":{"data":{"site":{"siteMetadata":{"title":"Clausehound Blog","author":"Joshua Koudys"}},"markdownRemark":{"id":"1d073a1e-54b0-5c1d-91b4-e3cc103ba6e0","excerpt":"This article posted on our partner site Mondaq.com highlights how important it is for parties to clearly state their intentions when drafting a letter of intent…","html":"<p><a href=\"http://www.mondaq.com/canada/x/292346/Securities/Letters+of+Intent+that+Bind\" target=\"_blank\" rel=\"nofollow noopener\">This article posted on our partner site Mondaq.com</a> highlights how important it is for parties to clearly state their intentions when drafting a letter of intent (LOI).</p>\n<p>Parties may intend for an LOI to be an enforceable agreement or non-binding, “agreement to agree”.</p>\n<p>The author explains that when considering if an LOI is binding the courts consider two (2) key factors. <em>First</em>, does the LOI contain all essential information relating to the transaction or does it refer to future negotiations about significant terms of the deal? <em>Second</em>, did the parties intend to be bound, understanding that the definitive agreement would mirror the terms outlined in the LOI, or intend to suspend all legal obligations until establishing a final agreement?</p>\n<p>When preparing a non-binding LOI, parties should explicitly state the non-binding intent of the LOI (or of specific previsions). Further to this, parties should avoid using contractual language and refer to the document as an <strong>LOI</strong>, <strong>term sheet</strong>, or <strong>agreement to agree</strong>.</p>","frontmatter":{"title":"Blog Bite: When is a letter of intent binding?","date":"November 09, 2017","description":"This article discusses the importance of parties to clearly state their intentions when drafting a letter of intent (LOI).","author":{"id":"alina@clausehound.com","first":"Alina","last":null,"bio":null,"image":null},"tags":["Term Sheet","Letter of Intent","Share Purchase Agreement","Blog Bites","Mondaq","Investor Term Sheet","Memorandum of Understanding"]}}},"pageContext":{"slug":"/blog-bite-when-is-a-letter-of-intent-binding/","previous":{"fields":{"slug":"/blog-bit-letters-of-intent-binding-or-non-binding/"},"frontmatter":{"title":"Blog Bite: Letters of intent, binding or non binding?","tags":["Term Sheet","Letter of Intent","Share Purchase Agreement","Blog Bites","Mondaq","Investor Term Sheet","Memorandum of Understanding"],"author":{"id":"alina@clausehound.com","first":"Alina","last":null}}},"next":{"fields":{"slug":"/blog-bite-what-is-the-nature-of-transaction-letters-of-intent/"},"frontmatter":{"title":"Blog Bite: What is the nature of transaction letters of intent?","tags":["Term Sheet","Letter of Intent","Share Purchase Agreement","Blog Bites","Mondaq"],"author":{"id":"alina@clausehound.com","first":"Alina","last":null}}}}}}