PERSONAL & CONFIDENTIAL
Re: Letter of Intent
The following represents a summary of 's proposal to regarding (the "Proposed Transaction"). This letter contains nonbinding provisions of understanding between the parties. Unless otherwise explicitly stated, it does not impose any legal obligations on either party.
The Proposed Transaction requires additional documentation and approvals, including the preparation and approval of one or more final agreements (the "Final Agreements") setting forth the terms of the Proposed Transaction in further detail. Before the Final Agreements are reached, I would like to confirm that we share an understanding of the principal terms and conditions of the Proposed Transaction, and that all parties are willing to proceed in mutual good faith to work toward Final Agreements and a closing consistent with these terms.The Proposed Transaction requires additional documentation and approvals, including the preparation and approval of one or more final agreements (the "Final Agreements") setting forth the terms of the Proposed Transaction in further detail. Before the Final Agreements are reached, we would like to confirm that we share an understanding of the principal terms and conditions of the Proposed Transaction, and that all parties are willing to proceed in mutual good faith to work toward Final Agreements and a closing consistent with these terms.
Our proposal is as follows:
1. PROPOSED TRANSACTION.
will do each of the following: .
will do each of the following: .
The parties shall execute the Final Agreements and close the Proposed Transaction by (the "Closing Date"), subject to the extension discussed in section below.
Any obligation to consummate the Proposed Transaction under the terms of this letter is based entirely on satisfaction of each of the following conditions:
- (a) receipt of all applicable consents, approvals, and authorizations including board, partnership, third-party, and regulatory approvals, if any, relating to the Proposed Transaction; and
- (b) completion by each party and its business, legal, financial, and engineering representatives of a substantial due diligence investigation of all relevant business, legal, financial, engineering, and environmental documents, with results satisfactory to that party, no later than (the "Due Diligence Completion Date").
4. DUE DILIGENCE.
While this letter remains in effect, each party and its advisors shall have reasonable access to the other party's books, records, and personnel files, and shall receive such financial and operational data and other information as that party may reasonably request. Any received information will be kept confidential by the receiving party. On termination or expiration of this letter, each party shall return all printed information received from the other party in connection with the Proposed Transaction.
5. NOTICE AFTER COMPLETION OF DUE DILIGENCE.
On or before the Due Diligence Completion Date, each party shall notify the other party in writing that it has completed substantial due diligence and is prepared to proceed with consummation of the Proposed Transaction (the "Notice of Intention to Proceed"). If a party does not provide a Notice of Intention to Proceed to the other party on or before the Due Diligence Completion Date, the other party may cancel this proposal and neither party will have any obligation or liability to the other party. The effective date of receipt of a Notice of Intention to Proceed is its date of receipt as acknowledged in writing by the receiving party.
6. EXTENSION OF TIME FOR CLOSING.
If the Proposed Transaction is not completed by the Closing Date and each party has been operating in good faith to complete its due diligence and negotiate the transaction documents to consummate the Proposed Transaction, the parties shall evaluate the progress made towards closing and, if suitable progress is being made, discuss in good faith a revised Counting Period (as defined below) and Closing Date. If the parties have not made satisfactory progress towards closing, either party may withdraw from the Proposed Transaction without any further obligation or liability to the other party. A party withdrawing from the Proposed Transaction under the preceding sentence shall promptly inform the other party in writing of this withdrawal. The term "Counting Period" means the period from the date of this letter until the Closing Date, if on or before the Due Diligence Completion Date each party has sent the Notice of Intention to Proceed in accordance with the terms of section above.
7. FINAL AGREEMENTS.
The Final Agreements may include customary covenants, conditions, representations, and warranties. As this is a nonbinding letter, there may be additional elements for negotiation and inclusion.
8. NO PUBLIC DISCLOSURES.
Except as required by law, neither party may make a public disclosure about the Proposed Transaction before the Closing Date without the prior written approval of the other party. If the law requires a disclosure, the disclosing party must notify the other party in advance and furnish the other party with a copy of the anticipated disclosure. Any disclosure not required by law that occurs after the Closing Date must be mutually agreeable to the parties. Nothing in this section prevents either party from communicating information about this letter to its respective affiliates, officers, directors, employees, or professional advisors or to any third parties whose consent is required in connection with the Proposed Transaction.
9. EXCLUSIVE DEALING.
In consideration of the effort and expense to be incurred by the parties in connection with their due diligence review of the Proposed Transaction, for a period of days from the date of this letter, neither party or its officers, directors, employees, and agents may initiate, encourage (directly or indirectly), or accept any third-party offer or proposal related to the Proposed Transaction, and may not enter into any agreement, understanding, or transaction that would have an adverse affect on the ability of the parties to consummate the Proposed Transaction.
Each party is responsible for all of its own costs and expenses incurred in connection with the Proposed Transaction or this letter, whether or not the Proposed Transaction is consummated. Except for breach of any confidentiality provisions, neither party will have any liability to the other party for any liabilities, losses, damages, costs, or expenses incurred by the party if negotiations between the parties are terminated as provided in section below.
11. COVENANT NOT TO COMPETE.
In the Final Agreements, the parties may agree that they will not, directly or indirectly, through a subsidiary or otherwise, compete with the other party in its business for a period of years after the Closing Date.
12. NONBINDING LETTER; WITHDRAWAL.
Except for the provisions set forth in section(s) , this letter as a whole does not constitute a legal and binding obligation or agreement between the parties. This letter as a whole does not constitute a legal and binding obligation or agreement between the parties. Accordingly, either party to this letter may unilaterally withdraw from negotiation or dealing at any time for any reason at the withdrawing party's sole discretion by notifying the other party of the withdrawal in writing. If a party withdraws from dealing or negotiation before , or fails to negotiate in good faith, any obligation to negotiate and prepare the Final Agreements or otherwise deal with the other party, and the agreements of the parties set forth in section(s) , will immediately terminate. The terms of any Final Agreements entered into by the parties control over the right to withdraw from dealing or negotiations in this section.
If the terms of this letter are acceptable to you, please sign in the space provided below and return it to the attention of the undersigned. undersigned no later than . We look forward to working with you to complete the Proposed Transaction. I look forward to working with you to complete the Proposed Transaction.
|Agreed to on ______________________________________