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Confidentiality Agreement. A confidentiality agreement is a "first date" agreement.. Often the two parties have had little business dealings with each other prior and the purpose of the discussions is to determine whether there is a mutual interest in what is being discussed. Note however that it is just as necessary to have a confidentiality agreement when the parties know each other well. Discussions under confidentiality allow the information receiving party to stay "Stop, let's not take this discussion further as I am already doing what you are disclosing to me".

Many individuals will use the terms Letter of Intent, Memorandum of Understanding, and Term Sheet interchangeably, however there are slight, mainly style, differences. Memorandum of Understanding (MOU): The main difference between the MOU and LOI is the nature of the signatories. While two parties are involved in a LOI, a MOU can involve more than two parties. Additionally, while a letter of intent needs only the party which proposes the agreement to be a signatory, a MOU implies that all the parties involved have to be signatories.

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