Shankce.

com

LoI with Negotiations Ongoing

To: [Name and address]

Attention:

Reference:

Date:

DESCRIPTION OF WORK/SERVICES: ________________________

CONTRACT NUMBER _______________

LETTER OF INTENT

1) We refer to our Invitation to Tender enquiry

reference ..................................... dated ................... and your tender offer
reference ....................... dated ...................
and the following subsequent relevant correspondence as listed hereunder:-
(insert list of post-tender correspondence containing relevant information
between Client and Tenderer)
1.
2.
3.
4.
5.
6.

2) by this letter we notify you that it is our intention to award you the Contract for
this Work/Service generally in accordance with the terms of the documents
listed in paragraph 1) above and it is our understanding that you will enter into
the Contract on that basis subject to the resolution of any outstanding matters
between us.

3) this letter does not constitute nor shall it be construed to mean or evidence a
Contract between us and merely serves as notice of our intentions with respect
to the above Tender.

4) any work which you may elect to do in anticipation of a Contract between us

shall be entirely at your own risk and we will not be liable for any costs incurred
by you prior to execution of any future contract between us with respect to the
subject Work/Service.

If all negotiations are complete insert

5) we are currently preparing Contract Documents which we will forward to you for
execution in the near future.

If negotiations are on-going insert

6) subject to a satisfactory conclusion of our current negotiations, we expect to be
in a position to commence preparation of Contract Documents shortly which
when ready will be forwarded to you for execution.

7) in the event that no formal Contract is entered into between us neither you or us
will have any liability to the other in respect of the subject matter of this letter.

8) kindly acknowledge receipt of this Letter of Intent and confirm your willingness
to enter into a Contract if requested to do so by [Client].

For [Name of Client]

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LoI with no outstanding matters but limiting commitment value

To: [Name and address]

Attention:

Reference:

Date:

DESCRIPTION OF WORK/SERVICES: ________________________

CONTRACT NUMBER _______________

LETTER OF INTENT

1) we refer to our tender enquiry reference .......................... dated ...............

and your tender offer reference .................... dated .............. and the
following subsequent relevant correspondence as listed hereunder:-

(insert list of post-tender correspondence containing relevant information

between Client and Tenderer)

1.
2.
3.
4.
5.
6.

Either (If matters remain outstanding)

2) it is our intention to award you the contract for this work generally in accordance
with the terms of the documents listed in paragraph 1) above and it is our
understanding that you will enter into the contract on that basis.

4) pending the execution of a formal contract between yourselves and [Client], the
following arrangement shall apply between us:-

5) this Letter of Intent constitutes an instruction by us to you to make all necessary

arrangements to commence, and actually to commence, the work envisaged in
the documents listed in paragraph 1) herein. you shall carry out the work in
accordance with the terms and conditions contained herein.

6) under this Letter of Intent you shall perform the work and we shall pay you for it
in accordance with the provisions of the documents listed in paragraph 1), all the
terms of which form the basis of this Letter of Intent, and which are to be
incorporated in the formal contract which is to be executed between us.

7) notwithstanding paragraph 6) above, we shall have the right to terminate this

Letter of Intent at any time by giving written notice of this to you, but should we
exercise this right we shall pay you the audited amount due to you in respect of
work carried out by you from the date hereof up to the date of termination
provided that the reason for termination is not a default on your part. the sum
to be paid to you hereunder in respect of the said work shall be calculated in
accordance with the terms of the documents listed in paragraph 1) herein.

8) no information concerning this Letter of Intent or in respect of any formal

contract which is to be executed between us shall be released publicly by you
without our written approval.

9) the contract price for the work envisaged in the documents listed in paragraph
1) of this Letter of Intent is:

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Dhs. ..................(Words..................................)

Note: Following section in [] is optional if further clarification is required

[which sum includes the following:-

(If the intention of the Letter of Intent is to limit initial exposure to enable work
to start, list items covered by this arrangement)

but excludes the following:-

(If optional items/daywork or other Prime Cost sums exist exclude these)

the limit of [Client’s] expenditure under this Letter of Intent shall not
exceed ............... ( .....................................) without [Client’s] prior
authorisation given in writing.]

10) you should make immediate contact with (Mr................ telephone ................)
for agreement of your programme and procedures for this work.

11) this Letter of Intent shall become binding on both of us on the date that you
dispatch your unqualified acceptance of this Letter of Intent which should be
sent by return fax/email/letter confirming the contents of this Letter of Intent.

12) within .......... days of receipt by [Client] of your unqualified acceptance of this
Letter of Intent you are to submit to [Client] the performance bond/parent
company guarantee (delete as applicable) as specified in the conditions of
contract referenced in paragraph 1) above.

13) it is understood and agreed that upon your acceptance of this Letter of Intent
you further undertake on request by [Client]to enter into a formal contract with
[Client]in accordance with the terms of the documents listed in paragraph 1)
herein. the execution of the formal contract between us shall supersede this
Letter of Intent and all work performed and payments made under this Letter of
Intent shall be deemed respectively performed under the contract which shall be
deemed to have been executed on the date of your signed acceptance of the
terms and conditions contained therein.

14) you agree that your refusal or failure for whatever reason to enter into a formal
contract in the terms of paragraph 13) above shall be deemed a default by you
under this Letter of Intent.

please confirm your unqualified acceptance of this Letter of Intent by return

fax/email/letter.

for [Client]

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LoI with outstanding matters clearly stated in the LoI

Letter of Intent

1) we refer to our tender enquiry reference .....................................

dated ................... and your tender offer reference .......................
dated ................... and the following subsequent relevant correspondence as
listed hereunder:-

(insert list of post-tender correspondence containing relevant information

between Client and Tenderer)

1.
2.
3.
4.
5.
6.

Either (If matters remain outstanding)

2) subject to agreement being reached on the outstanding matters which are

referred to in paragraph 3) below, and which are the only matters remaining for
discussion between us, it is our intention to award you the contract for this work
generally in accordance with the terms of the documents listed in paragraph 1)
above and it is our understanding that you will enter into the contract on that
basis.

3) the matters upon which agreement has yet to be reached are as follows:-
(Insert list of all outstanding matters to be resolved)

1.
3.
4.
5.

4) pending agreement upon these outstanding matters and the execution of a

formal contract between yourselves and [Client], the following Letter of Intent
Letter of Intent shall apply between us:-

5) this Letter of Intent constitutes an instruction by us to you to make all necessary

arrangements to commence, and actually to commence, the work envisaged in
the documents listed in paragraph 1) herein. you shall carry out the work in
accordance with the terms and conditions contained herein.

6) under this Letter of Intent you shall perform the work and we shall pay you for it
in accordance with the provisions of the documents listed in paragraph 1), all the
terms of which form the basis of this Letter of Intent, and which are to be
incorporated in the formal contract which is to be executed between us.

7) notwithstanding paragraph 6) above, we shall have the right to terminate this

Letter of Intent at any time by giving written notice of this to you, but should we
exercise this right we shall pay you the audited amount due to you in respect of
work carried out by you from the date hereof up to the date of termination
provided that the reason for termination is not a default on your part. the sum
to be paid to you hereunder in respect of the said work shall be calculated in
accordance with the terms of the documents listed in paragraph 1) herein.

8) no information concerning this Letter of Intent or in respect of any formal

contract which is to be executed between us shall be released publicly by you
without our written approval.

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9) the contract price for the work envisaged in the documents listed in paragraph
1) of this Letter of Intent is:

Dhs. ..................(...................................)

Note: Following section in [] is optional if further clarification is required

[which sum includes the following:-

(If the intention of the Letter of Intent is to limit initial exposure to enable work
to start, list items covered by this arrangement)

but excludes the following:-

(If optional items/daywork or other Prime Cost sums exist exclude these)

the limit of expenditure under this Letter of Intent shall not exceed ...............
( ....................... US$) without [Client’s] prior authorisation given in writing.]

10) you should make immediate contact with (Mr............. telephone ..............) for
agreement of your programme and procedures for this work.

11) this Letter of Intent shall become binding on both of us on the date that you
dispatch your unqualified acceptance of this Letter of Intent which should be
sent by return telex confirming the contents of this Letter of Intent.

12) within .......... days of receipt by [Client] of your unqualified acceptance of this
Letter of Intent you are to submit to [Client] the performance bond/parent
company guarantee (delete as applicable) as specified in the conditions of
contract referenced in paragraph 1) above.

13) it is understood and agreed that upon your acceptance of this Letter of Intent
you further undertake on request by [Client] to enter into a formal contract with
[Client] in accordance with the terms of the documents listed in paragraph 1)
herein, subject only to such additions or amendments thereto as may be
necessitated by our agreement on the outstanding matters referred to paragraph
3) herein. the execution of the formal contract between us shall supersede this
Letter of Intent and all work performed and payments made under this Letter of
Intent Letter of Intent shall be deemed respectively performed under the
contract which shall be deemed to have been executed on the date of your
signed acceptance of the terms and conditions contained therein.

14) you agree that your refusal or failure for whatever reason to enter into a formal
contract in the terms of paragraph 13) above shall be deemed a default by you
under this Letter of Intent.

please confirm your unqualified acceptance of this Letter of Intent by return telex.

for [Client]

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LoI with No outstanding matters but Limit of Commitment Value

Contractor name and full address

Attn:

Email:

Tel.:
Fax.:
Mobile:

Dear sir’s,

Letter Reference:

Date:

CONTRACT NUMBER:
CONTRACT FOR:
“Letter of Intent”

Letter of Intent

1. _______________________________________ (“COMPANY”) hereby confirms

its intention to enter into a contract with [name of Contractor] a company whose
registered office is situated at: [address of Contractor] with registration number
(“CONTRACTOR”) under terms and conditions agreed between them and
specified in the relevant documents referred below and copies of which are
attached as Attachment 1 hereto:

1.
2.
3.
4.
5.
6.
7.
8.
9.
10.

(hereinafter called the “CONTRACT”). In this Letter of Intent the terms in upper
case have the meaning assigned to them under “Definitions” of the Terms and
Conditions of CONTRACT.

2. In the event that COMPANY exercises its option to enter into the CONTRACT,
such CONTRACT will supersede in its entirety this Letter of Intent and be
deemed to be effective from the date of this Letter of Intent.

3. This Letter of Intent is effective on [insert date when the CONTRACT is effective]
and, subject to Item 7 below, shall be valid until [insert date if the CONTRACT
needs an expiry date] OR [a formal CONTRACT is signed between both parties]
when the Letter of Intent shall automatically expire.

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4. CONTRACTOR shall commence the SERVICES on [insert CONTRACT

commencement date].

5. In consideration for the performance of SERVICES by CONTRACTOR hereunder,

COMPANY agrees to compensate CONTRACTOR for the SERVICES under this
Letter of Intent in accordance with the invoicing and payment terms contained in
the CONTRACT. The limit of COMPANY liability in respect of such compensation
under this Letter of Intent shall under no circumstances exceed in the aggregate
[insert maximum financial liability/ amount payable to CONTRACTOR under the
LOI]. CONTRACTOR shall not be entitled to any compensation whatsoever in
excess of the limit of liability stated above.

6. Each PARTY agrees that for the duration of this Letter of Intent, the terms and
conditions of the CONTRACT shall apply and the CONTRACTOR shall perform the
SERVICES as if the CONTRACT was in full force and effect

7. COMPANY shall have the right to terminate this Letter of Intent with immediate
effect at any time by giving written notice of such termination to CONTRACTOR.

8. CONTRACTOR agrees to keep confidential the terms of this Letter of Intent, the
CONTRACT and all related data and information and not to disclose such terms,
data and information in whole or in part to any person.

9. This Letter of Intent shall be governed by the [insert applicable law] Law.

For and on behalf of

[insert name of COMPANY]

Signature:

Name:

Title:

Date:

Accepted for and on behalf of

[insert name of CONTRACTOR]

Signature:

Name:

Title:

Date:

Page 7 of 7 Letter of Intent - Sample Formats