Letter of Intent (LOI)

An LOI (letter of intent) is often used interchangeably with term sheet, though in M&A contexts an LOI tends to be more detailed and describes an acquisition proposal with greater specificity. The LOI typically covers: proposed purchase price and payment structure, proposed transaction structure (stock vs. asset purchase), conditions to closing (financing, due diligence, regulatory approvals), exclusivity period granting the buyer sole negotiating rights, and the expected timeline to close.

The exclusivity provision is usually the most binding term in an LOI, and negotiating its duration is significant. Too short (30 days) may not be enough time for the buyer to complete diligence; too long (90 days or more) removes pressure from the seller and gives the buyer time to renegotiate after discovering issues in diligence. Document intelligence can quickly extract and compare LOI terms across multiple potential acquirers or targets, helping deal teams evaluate competing proposals with a structured, side-by-side view.