JP 3E Holdings Inc (JPTE)

[shotsky]

As a previous director in a public company, we used both MOU's and LOI's previous to making a signed contract. Upon first meeting, if mutual interest exists, a MOU is created by the initial company. An NDA (non-disclosure agreement) is generally signed by both parties at that point.The MOU is agreed to by both parties, but it is merely a roadmap for next steps. Further meetings firm up the milestones required to achieve the 'goal', at which time an LOI is generally created. That lists the major requirements for both sides, and is the first indication that the parties intend to complete the arrangement. The final agreement, or contract, is then created from the LOI and passed back and forth between the two parties until all the I's are dotted and all the T's crossed. Legal from both sides are involved to ensure nothing has been left out. The 'deal' can fall apart any time before the final agreement is signed by both parties. Sometimes, a deal just can't be worked out. There is absolutely nothing binding about either the MOU or the LOI - the final agreement, when signed, is binding.