# Letter of Intent

*Corporate Finance & M&A — Finicade finance glossary*

A letter of intent sets out the headline terms of a deal before the binding contract — price, structure, timetable, exclusivity. Most of it is deliberately non-binding, with a few clauses that aren't: exclusivity, confidentiality and cost allocation. Its real function is to anchor the negotiation and to lock the seller out of talking to anyone else while the buyer spends money on diligence.

**Also known as:** LOI, term sheet, heads of terms, MOU

**Related terms:** [Data Room](https://finicade.com/glossary/data-room), [Due Diligence](https://finicade.com/glossary/due-diligence), [Break Fee](https://finicade.com/glossary/break-fee), [Mergers and Acquisitions (M&A)](https://finicade.com/glossary/mergers-and-acquisitions), [Earnout](https://finicade.com/glossary/earnout)

Source: https://finicade.com/glossary/letter-of-intent