In law, an agreement in principle is a stepping stone to a

contract A contract is an agreement that specifies certain legally enforceable rights and obligations pertaining to two or more parties. A contract typically involves consent to transfer of goods, services, money, or promise to transfer any of thos ...

. Such agreements with regard to the principle are usually considered fair and equitable. Even if not all details are known, an ''agreement in principle'' may, for example, outline a schedule of

royalties A royalty payment is a payment made by one party to another that owns a particular asset, for the right to ongoing use of that asset. Royalties are typically agreed upon as a percentage of gross or net revenues derived from the use of an asset or ...

. In

real property In English common law, real property, real estate, immovable property or, solely in the US and Canada, realty, refers to parcels of land and any associated structures which are the property of a person. For a structure (also called an Land i ...

transactions, a ''binder'' is a document that sets the sales price for the property.

References

Legal terminology {{law-term-stub