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Letter of Intent (LOI): All you need to know

You are ready to start your dental practice in California after spending years gathering clinical experience. Launching your practice is no different than starting a new business, and you have to plan things ahead. From scouting locations in your chosen city to finding lenders, there are numerous steps in the process before you can actually start working on the building and equipping your office. Among the first steps is to consult a healthcare business attorney California, who can advise on key matters. Among the initial documents, you would need a letter of intent (LOI). In this post, we are discussing more about this document.

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What is a letter of intent?

Also known as an LOI, a letter of intent is the document that communicates your intention to do business with the other side. Also, LOIs state the important terms of the proposed deal. If you want to purchase a dental practice, you can use a letter of intent to make an offer. It’s like telling the seller that you are interested in the investment. In simpler words, think of this as a practice purchase document. The LOI is prepared based on the info shared by the seller or the real estate broker with regards to price and other details. Before you sign a formal document for purchase, an LOI allows you to discuss and negotiate key aspects. 

What does a letter of intent look like?

In general, a letter of intent is expected to be a brief document with no more than three pages. However, the contents determine the eventual number of pages. If you are selling a dental practice, your broker will write the LOI and vice versa. In some cases, the buyer may rely on their lawyer to draft a letter of intent, which would be eventually reviewed and signed by both parties. An LOI contains – 

  • Introductory paragraph stating the purpose
  • Parties involved with relevant details
  • Details of the dental practice being purchased, with info related to assets that are included with the intended sale
  • Outline the terms of the offer, including loan details and purchase price
  • Disclaimers stating when either party can terminate or void the agreement
  • Date of acceptance
  • A small summary
  • Signatures of both sites

Want to know more? Talk to a healthcare business attorney today, and don’t shy away from asking questions about the entire process. Buying a dental practice would be easy if you have a good team at work.

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