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While most are not legally binding, there may still be consequences for not complying with the agreed upon portions of the letter. A Letter of Intent is often seen like purchase or crowd-sourced orders, so they are often used to help secure funding or prove the value of the business. If the other party drops out or doesn't honor "in good faith" the letter, actual financial damage may be incurred to the company. In court, most often the judge will make decisions based on what implied intent is expressed in the letter. Sometimes there can be recourse if the parties do not follow through towards an actual legal agreement.

Here are some other terms that may also be included: Confidentiality » the agreement and any information learned will remain confidential. Covenants » things each party must do while negotiations are taking place. Special Terms » any special terms that the parties agree will be in the purchase agreement, such as leaving certain items of furniture or hiring certain employees.

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