Document background
A Letter of Intent to Sell is commonly used in German business transactions as a preliminary step before entering into a definitive sale agreement. It is particularly valuable when parties need to establish a framework for complex negotiations while maintaining flexibility. The document typically precedes detailed due diligence and final contract negotiations, outlining key commercial terms such as the asset or business to be sold, approximate purchase price, and timeline. Under German law, while most provisions are non-binding, certain aspects like confidentiality obligations and exclusivity periods can create legally binding commitments. The document helps parties align their expectations and demonstrates serious intent while preserving room for detailed negotiations. It's especially useful in cross-border transactions where parties need to establish clear parameters within the German legal framework before committing significant resources to the transaction.
