PRIVATE AND CONFIDENTIAL

Your Ref: [Ref No.]

To FIRST LAST, 

[Address]

06 May 2024

 

Dear [Title] LAST,

Re: Memorandum of Understanding dated [date]  (“MOU”) on the Sale and Purchase of [Quantity] of [Products] for delivery in [Location] (the “Transaction”)

Thank you very much for your letter dated [Date]. We appreciate your efforts in getting the approvals from the relevant stakeholders for the Transaction under the MOU.

Just to let you know that we are also keen to transact in higher volumes with you. However, as we have no previous trading relationship, the [quantity] under the MOU is purely a trial run in order to build trust between the parties. We do have trading relationships with very large buyers who can potentially absorb in excess of [quantity] per annum. 

As the proposed Transaction is large and involves many parties – buyer, seller, bank, transport, warehouse etc. It would be prudent to have an initial trial run with a relatively small initial volume to resolve any potential delivery, payment and timing issues we may have. Once we have established a smooth payment and delivery workflow acceptable to all parties involved, we would be able to gradually increase our daily intakes to more than [quantity] per annum. We are confident that we will be able to dispose of all [total volume] over time.

As you are aware, ACCOUNT_JOB_COMPANY is an established player in the [Product] market and has been providing professional solutions to our clients. Our strategic partner, [Name], has been in the [Product] business for more than [number] years and is very well regarded in the industry. We believe the best strategy to dispose of such a large quantity of [Product] is by small daily volumes over a period of time instead of a large block trade of [total volume], which will no doubt have a very negative impact on the pricing. Small daily volumes will minimise the impact on market price, resulting in a lower discount required by the dealer. It will also allow the Seller to sell at a fair, average price for the year, instead of a temporarily depressed price as a result of the negative impact of each large sale to the market. 

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