A term sheet is a pre-contractual document that outlines the main terms and conditions of an agreement between parties in relation to a proposed transaction (e.g. sale of a business). This term sheet is designed to specifically cater for the sale or purchase of a business. For a more general term sheet please refer to “Term Sheet / Heads of Agreement – General”.
A term sheet generally serves the same purpose as a heads of agreement, memorandum of understanding or letter of intent, although the form of the document may differ.
A term sheet may be binding or non-binding on the parties. If it is binding, and only subject to the preparation of legal documentation, then the term sheet must be detailed and outline all the clauses to be included in legal documentation to be subsequently prepared by the parties (or their legal representatives). If it is non-binding, then there may be in principle agreement by the parties of a proposal, setting out the terms proposed by one of the parties in relation to the proposed transaction.
After the parties have executed a term sheet, a legally binding contract should be negotiated, prepared and executed by the parties, which should contain detailed provisions and govern all aspects of the proposed transaction (eg. a Sale of Business Agreement, which can by viewed here: “Sale Contract – Business”).
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You will need the following information to generate your document:
- Name of the vendor and purchaser
- Address of the vendor and purchaser
- Assets included / excluded in the sale
- Purchase price
LegalVision’s LVDox™ Free Term Sheet/ Heads of Agreement sets out:
- basic definitions of the parties and the transaction;
- a basic conditions precedent to the transaction clause;
- a basic costs clause; and
- a basic confidentiality clause.
You can choose to upgrade your LVDox to a LVDox Pro document. Upgrading your legal document has the following benefits:
- Consultation with a lawyer specialising in your industry
- Review of the legal requirements for your business
- Drafted specifically for your business and industry
- Document reviewed and signed off by a lawyer
- Covered by LegalVision’s professional indemnity insurance
- We provide a fixed-fee service so there are no surprises