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The Letter of Intent to Do Business is a crucial preliminary document in German business practice, typically used when parties have progressed beyond initial discussions but before committing to a definitive agreement. This document type is particularly important in the German legal context, where pre-contractual obligations and good faith principles carry significant weight. The LOI serves to document serious interest in a business relationship while providing a framework for further negotiations. It typically includes key terms, timelines, and any binding provisions (such as confidentiality), while clearly stating its generally non-binding nature. Under German law, while a Letter of Intent to Do Business is primarily non-binding, certain provisions may create legal obligations, and the principle of culpa in contrahendo may impose liability for bad faith negotiations. The document is commonly used in various business contexts, from merger discussions to joint venture negotiations, and helps structure the path toward a final agreement while managing expectations and responsibilities of all parties involved.

1. Date and Place: The date and location of the letter's issuance, following German business letter format

2. Recipient Details: Full name and address of the recipient company and appropriate contact person

3. Subject Line: Clear identification as a Letter of Intent (Absichtserklärung) and brief description of the proposed business relationship

4. Introduction: Brief introduction of the sending company and acknowledgment of previous discussions or meetings

5. Purpose Statement: Clear statement of business intention and scope of proposed collaboration or transaction

6. Basic Terms: Outline of fundamental terms being considered for the potential business relationship

7. Timeline: Proposed schedule for negotiations, due diligence, and intended completion of final agreement

8. Non-Binding Nature: Clear statement that this is a non-binding document (except for specified sections)

9. Confidentiality: Basic confidentiality provisions regarding the negotiations and shared information

10. Contact Details: Key contact persons for further negotiations and communications

11. Closing: Formal closing including signature blocks for both parties