What is a Letter of Intent?

This template is written for parties negotiating a transaction, so that both sides can see what was promised, what it costs, and what happens if circumstances change.

18 details are captured across 6 areas: parties and contact details, scope and deliverables, payment and financial terms, dates, timing and duration, confidentiality and intellectual property, and legal protections and risk. Together they fix what each party owes the party funding it, measured in agreed headings of terms rather than in adjectives.

Where these agreements go wrong, it is usually a heads of terms that turned out to bind more than anyone meant rather than a defect in the boilerplate. Business agreements tend to fail at the edges — deadlock between owners, automatic renewals nobody diarised, and liability caps that turn out to sit above the value of the contract.

The preview updates live as you complete each field, so you can review the exact language before downloading it as PDF or Word. Treat the result as a well-organised first draft: sound in structure, but worth an attorney's review where the sums involved are significant or the situation is unusual.

What matters most in a letter of intent

Careless wording can create a contract

If the terms are complete enough and the language sounds committed, a court may find a binding agreement despite the title. Be explicit.

Exclusivity has real value

A no-shop period stops the other side negotiating elsewhere while due diligence runs. Set its length.

Set a longstop date

Give the outline an expiry, so a stale document does not resurface months later as evidence of what was agreed.

When you need a letter of intent

  • Before each party starts: Put the letter of intent in place before anyone relies on it. An agreement signed after work has begun is far harder to enforce on the terms you actually intended.
  • When replacing an earlier arrangement: Issue a fresh letter of intent when the original terms no longer reflect what the parties actually do. Amending informally leaves two inconsistent records of one relationship.
  • When risk needs allocating: Decide who carries which risk and who insures it before an incident rather than after one. Afterwards, both readings of the silence are self-serving.
  • When the proposed deal needs defining: Write down what is included and what is not. A specific description is what turns an extra request into a chargeable variation rather than an argument.
  • When either side may need an exit: Agree how the arrangement ends while both parties are still on good terms. Exit clauses negotiated during a dispute rarely favour anyone.
  • When the arrangement will repeat: For a relationship that runs across several jobs or periods, agree the standing terms once and let each instance sit under them rather than renegotiating from scratch.

What to include in a letter of intent

This generator collects 18 details. Here is what each group covers and why it matters when the document is relied on.

Parties and contact details

Name each party and the party funding it as legal entities rather than as the people you deal with day to day. The individual you email is rarely the party that can be enforced against.

Company Name
The company's registered legal name, including its corporate suffix such as LLC, Inc or Ltd.
Company Address
The company's registered office or principal place of business.
Counterparty Name
The full legal name of the other party entering into this agreement.
Counterparty Address
The counterparty's address for formal notices.

Scope and deliverables

The description of the proposed deal is what turns an extra request into a chargeable variation. Write it so that someone outside the arrangement could tell what is in and what is out.

Purpose of Agreement
Why the parties are entering into the agreement. This helps a court interpret ambiguous clauses in line with the parties' actual intent.
Products or Services
The goods or services supplied, identified by specification, model or catalogue reference.
Performance Standards
The measurable standard the work must meet — response times, quality levels or service metrics.

Payment and financial terms

Tie each payment to something observable — a delivered agreed heading of terms, a date, or signature of the definitive agreement — rather than to a general sense that enough has been done.

Commercial Terms
The core business terms — volumes, discounts, rebates, minimum commitments and review points.
Pricing
The unit prices or rate card, plus how and when prices may be revised.
Payment Terms
The invoicing cycle, payment window, accepted methods and consequences of non-payment.
Limitation of Liability
The cap on each party's financial exposure. Note that liability for fraud, death or personal injury generally cannot be excluded.

Dates, timing and duration

Use calendar dates, not relative triggers. "On approval" cannot be located on a calendar, which means it cannot be used to show that anyone is late.

Effective Date
The date the agreement takes effect. This can differ from the signature date, and it is the date obligations start running from.
Delivery Timeline
Lead times and delivery windows, plus what counts as a late delivery and the remedy for it.

Confidentiality and intellectual property

State the territory, media, term and exclusivity of anything licensed. An unbounded licence is a transfer that was priced as a licence.

Confidentiality Obligations
The duty to keep information private, who it may be shared with internally, and the standard of care required.
Intellectual Property Rights
Who owns the IP created under the agreement, and what licence the other party receives.

Legal protections and risk

These are the clauses nobody reads until something goes wrong, at which point they are the only clauses that matter.

Warranties
The promises each party makes about quality, title and authority, and how long they last.
Termination Rights
The circumstances in which each party may end the agreement, distinguishing termination for convenience from termination for breach.
Governing Law
The legal system that applies and the courts that will hear any dispute.

Completing this letter of intent

Getting the numbers right

Write key figures out in full where the amount is central, and state the currency if either party is outside the country. Both are cheap precautions against an expensive misunderstanding on a letter of intent.

Filling in every blank

Unfilled placeholders are read against whoever produced the document. If a field genuinely does not apply, write "not applicable" rather than leaving a gap.

Not stopping at signature of the definitive agreement

Which clauses survive if the deal never completes continues past that point. Give it its own clause, because obligations that are merely assumed to survive often do not.

Recording where this applies

If the parties are in different states, name which state's law applies and where any dispute would be heard. Adding one line now avoids a preliminary argument later.

Checking the consents

Where a landlord, lender, insurer or licensing body has to approve the arrangement, obtain that approval before signature of the definitive agreement rather than assuming it will follow as a formality.

Common mistakes to avoid

  1. Leaving confidentiality out. Both sides usually see something they should not repeat. A short confidentiality clause that expressly survives the end of the agreement covers it.
  2. Relying on memory instead of the marker separating binding terms from intentions. When a dispute starts, the question is always what was agreed at the time. The marker separating binding terms from intentions is the record that answers it, so attach it to the agreement rather than keeping it in an inbox.
  3. Confidentiality that dies with the contract. Confidentiality obligations should expressly outlive termination. If they end with the agreement, so does the protection.
  4. Assuming the other side has authority. Check that whoever signs can bind their organisation. A signature from someone without authority is a defence waiting to be raised.
  5. Assuming insurance responds. Check that the policy actually covers this arrangement and this value. Cover assumed and never verified is the most expensive kind of assumption in the file.

How to use this letter of intent generator

  1. Fill in the form. Work down the 18 fields in order. The ones describing the proposed deal carry the most weight, so give them more than a few words — everything else in the document refers back to them. Nothing is sent to a server — the document is assembled in your browser.
  2. Read the preview. Check the preview against the marker separating binding terms from intentions. Where the two disagree, the document is the version that will be relied on, so fix it here.
  3. Download and sign. Take the PDF for signing or the Word version for further edits. Make sure the signed copy reaches everyone named, since a document held by only one side is hard to rely on.

Letter of Intent — frequently asked questions

Is a letter of intent legally binding?

Usually only in part, and it must say which part. The commercial terms are typically expressed as non-binding pending a definitive agreement, while confidentiality, exclusivity, governing law and costs clauses are stated to be binding. Without that express carve-out the position is genuinely uncertain — courts have found binding contracts in documents the parties assumed were merely indicative.

Does anything survive after the letter of intent ends?

Yes. Which clauses survive if the deal never completes continues past signature of the definitive agreement, and confidentiality obligations normally do too. Anything expected to survive has to say so expressly — an obligation that is merely assumed to continue generally does not.

Can a letter of intent be changed after signing?

Only by agreement, and the change should be recorded in writing and signed by both sides. Once amendments start being made by phone or in passing, the written document stops describing the arrangement, which defeats the purpose of having one.

Which state's law should govern this letter of intent?

Choose a state with a genuine connection to the parties or the subject matter — where a party is based, or where the work or property is located. A choice with no connection at all may not be respected, and for property or employment the local state's rules will often apply regardless of what the contract says.

Who owns the work produced under this agreement?

Whoever the agreement says owns it — and if it says nothing, the creator generally does. Paying for work does not transfer copyright by itself. If ownership is meant to pass to the client, the assignment clause needs to say so expressly, and it is common to make the transfer conditional on payment in full.

How long do the confidentiality obligations last?

Ordinary commercial information is usually protected for a fixed period of two to five years after the agreement ends, while genuine trade secrets are often protected for as long as they stay secret. Whichever you choose, state expressly that the confidentiality clause survives termination — otherwise the protection ends with the contract.

Can liability be limited to any amount?

Within limits. Parties can cap ordinary commercial liability, and a cap set against contract value or insurance cover is normal. But liability for fraud, death and personal injury generally cannot be excluded, and a cap so low it makes the obligations meaningless may be struck down as unreasonable.

Does a business contract need to be signed by a director?

It needs to be signed by someone with authority to bind the entity. For a company that is typically a director or an officer with delegated authority; for an LLC, a manager or authorised member. If you are unsure, ask for evidence of authority before relying on the signature.