Confidentiality Agreement and Letter of Intent _ Two Steps to Creating a New Business Relationship. One of the largest dilemmas faced by anyone who is forming a new business idea is who they should disclose their concept to in order to bring it to commercial reality. Disclosure is generally to potential funders, future customers and in some instances to future suppliers.
An LOI is a nonbinding legal agreement that not only expresses interest, but typically details the initial terms for the contemplated transaction, timing for due diligence, any contingencies (financing, Board approval, etc.), and specifies the timing to execute a final definitive agreement and close the transaction.