creating a letter of intent preliminary terms of a transaction (M&A, partnerships) before binding agreements. Key elements include purchase price, structure (asset/stock deal), due diligence timeline, exclusivity clauses, and closing conditions. For example, a PE firm’s LOI to acquire a tech startup might specify a $50M valuation, 60-day exclusivity, and earn-out provisions. LOIs are non-binding (except for confidentiality/no-shop clauses) but signal serious intent, guiding legal drafting. Tone should be professional yet flexible to accommodate negotiations.