Document background
The Exclusive Letter of Intent serves as a crucial intermediate step in significant business transactions under Dutch law, providing a framework for exclusive negotiations while parties work toward a definitive agreement. This document is typically used when parties have reached preliminary understanding on key commercial terms and want to proceed with detailed due diligence and negotiations without the risk of the counterparty engaging with other potential partners. The document combines non-binding provisions outlining the proposed transaction with legally binding commitments regarding exclusivity, confidentiality, and negotiation conduct. Under Dutch legal principles, particular attention must be paid to the doctrine of pre-contractual good faith, making it essential to clearly distinguish between binding and non-binding provisions. The Exclusive Letter of Intent typically includes specific timelines, conditions for termination, and may also address cost allocation and break fees.
