[Date]

[Addressee]

Dear [Name]:

Thank you very much for the proposal you submitted to us 
on [date] in response to our request. 

We are aware of the great deal of time and work that went 
into your bid. Therefore, regret to inform you that we have 
awarded the contract to another firm. We based our 
decision on [reason for rejecting bid]. 

We will certainly be inviting your firm to bid on our future 
projects and thank you once again for your proposal. 

Very truly yours,