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A letter of intent (LOI) is a document where parties express their intention to agree on certain terms in the future. It is often misunderstood by clients, as many are unsure of its purpose and significance. Tom Riley explains that an LOI is akin to a preliminary agreement, serving as a non-binding outline of terms that may lead to a formal contract. The LOI communicates the parties’ intentions without being a definitive agreement, making it a common source of confusion. Essentially, it acts as a way to signal potential future agreements, similar to discussing plans for a quiz at a later date rather than confirming it outright.
