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There are many different styles of drafting letters of intent, which vary from law firm to law firm and from business lawyer to business lawyer. These styles usually fall into one of three categories: (1) binding, (2) nonbinding, and (3) hybrids, like the model in Figure 4-2. In general, the type to be selected will depend upon (1) the timing and the scope of the information to be released publicly concerning the transaction (if any), (2) the degree to which negotiations have been definitive and the necessary information has been gathered, (3) the cost to the buyer and the seller of proceeding with the transaction prior to the making of binding commitments, (4) the rapidity with which the parties estimate that a final agreement can be signed, (5) the valuation ranges for the seller's company that have been discussed to date, (6) the degree to which the buyer needs or wants a period of exclusivity (and the degree to which the seller is willing to grant an exclusivity period, (7) the relative status of the parties and leverage that both the buyer and seller have, and (8) the degree of confidence each party has in the good faith of the other party and the absence (or presence) of still other parties that are competing for the transaction. In most cases, the hybrid format, which contains both binding and nonbinding terms, is the most effective format to protect the interests of both parties and to level the playing field from a negotiations perspective.