ExistBefore
IT

Corporate

How to protect a Letter of Intent

A Letter of Intent (LOI) often looks like a "preliminary", almost harmless document. Then a negotiation collapses, the price changes, a new partner steps in, or someone claims certain commitments were never on the table. Protect it immediately: keep versions, exchanges, and context before negotiating memories turn elastic.

5 min read

1. How it usually happens

A Letter of Intent usually comes to life during a phase where everyone smiles a lot: corporate transactions, investor onboarding, acquisitions, partnerships, incentive plans, executive hires, shareholder agreements, reorganisations, or delicate governance transitions.

Early on, everything is "still to be defined". Drafts are swapped, clauses tweaked, terms polished, and a PDF is sent "just to align". Then comes the curious moment: the very document everyone called informal takes centre stage in the argument.

It happens that one party uses the LOI as negotiating leverage: to claim the deal was virtually closed, to secure better terms, to pressure management, to block alternatives, or to accuse the other side of backing out after raising expectations. In other cases, someone prefers keeping the text blurred, so every phrase can be stretched like mozzarella on a pizza.

The most delicate part is the sequence of versions. An added word, a deleted condition, a shifted date, or a swapped attachment can alter the meaning of the negotiation. And when relationships stiffen, the question is always the same: which version was truly on the table?

2. What you need to prove

When protecting a Letter of Intent, you must be able to prove that a specific version of the document existed at a certain moment, and that it was linked to a particular negotiating exchange.

In concrete terms, it can be useful to prove:

  • the existence of the LOI on a given date;
  • the exact content of the version sent or received;
  • who drafted, modified, or transmitted the document;
  • what conditions were present, absent, or still open;
  • whether the text was a draft, a negotiated version, or a signed version;
  • which attachments were linked to the letter;
  • which emails or messages accompanied the submission;
  • what edit requests came afterwards;
  • what points were accepted, debated, or left hanging;
  • whether the letter was subsequently used to exert pressure, block choices, or renegotiate advantages.

The practical point is reconstructing the negotiation timeline, so as to prevent a draft from being spun as a final agreement, or an essential condition from vanishing from the narrative.

3. What to collect

To properly document an LOI, collect both the document and the path that produced it. The letter alone is important, but the exchanges surrounding the document often explain the true meaning of the phrases.

Neatly collect:

  • original LOI file;
  • sent or received PDF version;
  • prior drafts;
  • versions bearing revisions or comments;
  • cover emails;
  • relevant corporate messages or chats;
  • attachments cited in the letter;
  • linked term sheets, presentations, business plans, cap tables, budgets, or reports;
  • any internal negotiating authorisations;
  • minutes, meeting notes, or internal memos;
  • counterparty replies;
  • edit requests;
  • proofs of sending and receipt;
  • signed version, if any;
  • summary of points still open;
  • documents showing activities launched based on the letter.

A simple trick: always save the message transmitting the letter. A phrase like "sending the updated draft, we're still missing two points" can prevent weeks of arguing over that file's standing.

4. How to proceed

Before sharing the LOI, organise your material. Create a folder dedicated to the negotiation and separate drafts, sent versions, received versions, attachments, and communications. Document chaos is the best friend of future disputes, closely followed by files named "LOI_veryfinal_good".

Proceed practically:

  • give every version a clear name;
  • save the original file without modifying it;
  • export a PDF copy of the version to send;
  • keep the transmission email or message;
  • state in the text or message if certain points are still open;
  • archive cited attachments separately;
  • preserve replies and edit requests;
  • lock relevant versions in time, especially those sent, received, or signed;
  • if the letter changes, create a new version instead of overwriting the previous one.

If the letter contains economic terms, exclusivity, confidentiality, timelines, operational commitments, or corporate steps, document the internal context too: who authorised sending it, what limits the negotiator was given, which points were deemed essential. This stops a proposal from later being morphed into a broader promise than it was.

5. Mistakes to avoid

The most common mistakes stem from the idea that an LOI is "just a draft". Exactly because it sits halfway between a conversation and an agreement, it demands attention.

Above all, avoid:

  • overwriting previous versions;
  • sending editable files without keeping a stable copy;
  • leaving key conditions solely to chat messages;
  • failing to distinguish between draft, proposal, and accepted version;
  • forgetting cited attachments;
  • deleting comments and revisions without saving them;
  • using overly vague wording on price, timing, exclusivity, or conditions;
  • leaving the counterparty's edit requests untracked;
  • initiating operational activities without documenting which version you are relying on;
  • keeping only the signed version, losing the negotiating trail.

A useful tip is writing a brief internal memo after every major step: what changed, who asked for it, what points remain open. It’s less romantic than a handshake, but much more useful when that handshake gets retold in three different ways.

Free certification is useful because it allows you to lock down an LOI version before it gets altered, disputed, or used instrumentally in the negotiation.

6. After the documentation

After documenting the LOI, internally share only the correct version and clarify the document's status: draft, proposal, negotiated text, version to sign, or signed version. Anyone working on the project must know which text to rely on.

If negotiations proceed, update the file at every major step. If, however, disputes, aggressive demands, or personal pressures arise, reconstruct the sequence: first version, sending, comments, edits, potential signing, subsequent activities.

Depending on the situation, it may be useful to involve governance, finance, HR, management, compliance, or external consultants experienced in corporate transactions, contracts, negotiations, or risk management. The goal is to keep the discussion rooted in real documents, actual versions, and genuinely discussed terms.