Corporations and many other businesses can use this type of letter as a precursor to a formal agreement. In it they can list the salient points of their intentions and what they intend to include in formal contractual agreement if both parties can come to an amicable agreement. Thus it can be used as a fall back document should any questions arise during the final contract negotiations. A good example of this might be a letter sent to a company's investor explaining their intentions to buyout another company and what it is expected to do to the value of their stocks.
2.Seller warrants that at the time physical possession is delivered to Buyer, all equipment will be in working order and that the premises will pass all inspections necessary to conduct such business. 3.The Seller ensures that it has or will have clear and marketable title to the business being sold.