Document background
The LOI Purchase Agreement is a crucial preliminary document used in UAE commercial transactions when parties wish to formalize their initial understanding regarding a potential purchase while maintaining flexibility for detailed negotiations. This document type is particularly relevant in the UAE business environment where formal documentation of commercial intentions is highly valued. The LOI Purchase Agreement typically includes key commercial terms, due diligence requirements, and timeline expectations, while clearly distinguishing between binding and non-binding provisions in accordance with UAE law. It serves as a stepping stone toward a definitive purchase agreement, providing structure to negotiations while protecting parties' interests through specific binding provisions such as confidentiality and exclusivity clauses. The document must comply with UAE Civil and Commercial Codes and may need to consider Sharia law principles depending on the transaction nature.
