Letter of Intent: Share Purchase single seller group
Letter of intent for the sale by a single seller of a company which has one or more subsidiaries. It outlines the principal sale terms on a non-legally binding basis with legally-binding provisions covering confidentiality, exclusivity and costs.
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When do I use this document?
- for a proposed transaction involving the sale of a company including one or more subsidiaries
- where the target company is owned by a single shareholder
- to set out the principal agreed terms for the transaction on a non-legally binding basis
- as a preliminary step before preparing long form agreements
- to save time and future discussion and negotiation on the transaction documents
What are the key features?
- comprehensive letter of intent covering aspects such as:
- principal sale terms
- various consideration options, including upfront consideration at closing, deferred consideration, earnout consideration and completion accounts adjustment
- conditions for the transaction
- principal terms of the Share Purchase Agreement
- transaction process and timetable
- legally binding provisions addressing:
- exclusivity for the buyer for a defined period (if agreed)
- confidentiality of the letter of intent
- costs
- governing law and jurisdiction
What other documents are available?
For alternative forms of letter of intent for a company sale transaction, see:
When do I use this document?
- for the shareholders agreement between multiple investors and the founders
- where the investment is being documented in a separate subscription agreement
- for a private limited company incorporated in England and Wales
- in conjunction with a Subscription Agreement and new Articles of Association
- for Paper Rock’s associated Subscription Agreement and Articles of Association, see
What are the key features?
- full form shareholders agreement
- 27 clauses and 4 schedules over 30 pages
- investor rights: exercisable by a majority of the investors
- directors:
- investor director: investors’ entitlement to appoint a director
- other directors: the founder shareholder(s) rights to appoint a director
- board proceedings: how proceedings of the board will be conducted
- information rights: rights to information for the investors and other shareholders about the company and its finances
- future share issues: pre-emption rights on the issue of new shares
- share transfers: rules governing the transfer of shares, including:
- pre-emption rights on share transfers
- compulsory transfer events, including founder good and bad leaver clauses
- tag-along and drag-along rights
- reserved matters: matters requiring prior approval from the investors (acting by investor majority) and other shareholders
- restrictive covenants: restrictions on the founders from competing with the company and soliciting the company’s customers, suppliers and employees
What other documents are available?
For a combined Investment & Shareholders Agreement for an established business with multiple investors, see
For a standalone Shareholders Agreement for an established business with a single investor, see
For standalone Shareholders Agreements for start-up business, see
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Updated by a lawyer on 30/06/2025
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