The Letter of Intent in Ontario: What Is Binding and What Is Not
A letter of intent sets out the framework for a transaction.
Most of its terms are not binding. Price, structure, and timing are typically expressions of intent.
Certain provisions are binding.
Confidentiality, exclusivity, and sometimes break fees create real obligations.
The risk is not misunderstanding what is binding. It is relying on terms that are not.
The letter shapes expectations, even where it does not create enforceable rights.