LOI
Law & Legal abbreviation · Contract
| Stands for | Letter of intent |
|---|---|
| Categories | Law & Legal |
LOI stands for Letter of intent, a contract abbreviation also used in business.
Preliminary document outlining the main terms of a proposed transaction, such as an acquisition, lease or joint venture, before the parties negotiate a definitive agreement. Most of its terms are usually declared nonbinding, while provisions on confidentiality, exclusivity and expenses are often made binding.
Example: The buyer signed an LOI at $40 million, subject to due diligence and a 60-day exclusivity period.
Usage notes
Courts sometimes hold an LOI binding when it contains all essential terms and lacks clear nonbinding language; the famous Texaco v. Pennzoil verdict turned partly on whether a preliminary deal was binding. Similar documents are called term sheets, heads of terms (UK) or memoranda of understanding. In job hunting and admissions, LOI can also mean letter of interest.
Related abbreviations
More contract abbreviations
- FIDIC – International Federation of Consulting Engineers
- GMP – Guaranteed maximum price
- IDIQ – Indefinite delivery, indefinite quantity
- ISDA – International Swaps and Derivatives Association
- JVA – Joint venture agreement
- LDs – Liquidated damages
- LPA – Limited partnership agreement
- MAC – Material adverse change
- MAE – Material adverse effect
- MNDA – Mutual nondisclosure agreement
- MOA – Memorandum of agreement
- MOU – Memorandum of understanding
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This entry is for general education and is not legal advice. Abbreviation use varies between institutions; always confirm in context.