A letter of intent (LOI) is a document that summarizes the understanding between two or more parties regarding a potential transaction. LOIs are commonly used when the parties are contemplating a merger-acquisition, joint venture, real estate purchase or lease, or other significant transaction. An LOI outlines the general terms of the deal, often with the stated understandings that the specific terms of any deal are subject to further negotiation, and that the parties are not obligated to complete a transaction. Because the parties will likely be disclosing confidential information—including the fact that they are having such discussions—the LOI should usually include confidentiality and nondisclosure terms.

In South Carolina, a Letter of Intent (LOI) is generally considered a non-binding document that outlines the preliminary understanding between parties who are considering entering into a formal agreement, such as a merger, acquisition, joint venture, or real estate transaction. The LOI serves to summarize the key points of a potential deal, indicating the intention to negotiate in good faith and setting the stage for further discussions and due diligence. It typically includes terms that are subject to further negotiation and clarifies that the parties are not legally obligated to complete the transaction based on the LOI alone. However, certain provisions within the LOI, such as confidentiality and nondisclosure clauses, can be binding if explicitly stated. It is important for parties in South Carolina to clearly specify which parts of the LOI are intended to be binding and which are not, to avoid any legal misunderstandings. As with any legal document, it is advisable to consult with an attorney to ensure that the LOI accurately reflects the parties' intentions and complies with applicable state and federal laws.