The Customer Letter of Intent (LOI) is a crucial preliminary document used in Canadian business transactions to establish the foundation for future commercial relationships. It serves as a roadmap for negotiations while demonstrating serious business intent without creating full contractual obligations. Typically used when parties need to document their preliminary understanding before committing resources to detailed contract negotiations, due diligence, or complex commercial arrangements. The LOI outlines key terms such as proposed pricing, scope, timeline, and any exclusivity or confidentiality requirements. While predominantly non-binding, certain provisions may be explicitly made binding under Canadian law. This document is particularly valuable in complex transactions where parties need to secure preliminary commitment or when seeking internal approvals before proceeding with full contractual negotiations.
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1. Date and Addressee Details: Opening with current date and complete details of the recipient organization
2. Subject Line: Clear statement identifying the document as a Letter of Intent and brief reference to the proposed transaction
3. Introduction: Identification of all parties involved, including full legal names and addresses
4. Purpose Statement: Clear articulation of the intended business relationship or transaction
5. Key Commercial Terms: Outline of principal terms including proposed pricing, scope of services/products, and timeline
6. Duration and Exclusivity: Timeframe for which the LOI is valid and any exclusivity provisions
7. Confidentiality: Basic confidentiality obligations regarding the proposed transaction
8. Non-Binding Nature: Clear statement about which provisions are binding and non-binding
9. Next Steps: Outline of the process toward a definitive agreement
10. Signature Block: Space for authorized signatures from both parties
1. Due Diligence: Include when the transaction requires significant investigation or verification of business aspects
2. Break Fee: Add when there's a need to specify compensation if either party terminates discussions
3. Governing Law: Include when parties are in different jurisdictions or specific legal framework needs to be established
4. Dispute Resolution: Add when parties want to specify how potential disputes will be handled
5. Costs and Expenses: Include when there's a need to specify who bears the costs of negotiations and due diligence
6. Public Announcements: Add when there's potential public interest in the transaction or need for controlling public communications
7. Contact Details: Include when multiple stakeholders are involved and specific points of contact need to be established
1. Preliminary Price Schedule: High-level outline of proposed pricing structure or payment terms
2. Timeline Appendix: Proposed schedule for negotiation, due diligence, and completion of definitive agreements
3. Term Sheet: Summary of key commercial and legal terms to be included in the final agreement
4. Description of Products/Services: Overview of the products or services being considered in the transaction
Relevant legal definitions
Clauses
Relevant Industries
Technology and Software
Manufacturing
Professional Services
Retail and Consumer Goods
Healthcare
Financial Services
Real Estate
Construction
Energy and Utilities
Telecommunications
Education
Transportation and Logistics
Relevant Teams
Legal
Sales
Business Development
Procurement
Commercial
Finance
Operations
Risk Management
Corporate Development
Executive Leadership
Account Management
Relevant Roles
Chief Executive Officer
Chief Commercial Officer
Business Development Manager
Sales Director
Legal Counsel
Contract Manager
Procurement Manager
Commercial Director
Chief Financial Officer
Operations Director
Project Manager
Account Executive
General Manager
Corporate Development Manager
Risk Manager
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