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A letter of intent (LOI) is a document indicating that parties may agree to terms in the future, often causing confusion among clients. Many people are unsure of its purpose. Tom Riley explains that an LOI is not a binding contract but serves as a preliminary agreement, outlining intentions and setting the stage for a potential future contract. It's likened to a substitute teacher who discusses a quiz that will happen later, emphasizing that it doesn't establish immediate obligations but rather indicates a desire to negotiate further. Overall, it acts as a framework for future discussions and agreements.
