What Is a Term Sheet?

A document setting out key proposed commercial or investment terms, often as a basis for further negotiation and documentation.

What Does Term Sheet Mean?

A term sheet summarises the key commercial terms proposed for a transaction, such as an investment or acquisition. It is typically a starting point for negotiation and final documentation.

Why It Matters

Term sheets focus discussions on the essential terms before expensive documentation begins. Whether a term sheet is binding depends on its wording and the intention of the parties.

Related Information

Related legal terms: Due Diligence, Shareholders’ Agreement

Related practice area: Startup Legal Services →

Dealing With a Related Matter?

This explanation is a general starting point. If the term matters in a specific situation you are facing, a conversation about your facts can help you decide the right next step.

Contact Gyanendra Singh →

This definition provides general information and does not constitute legal advice. Laws change, and their application depends on the facts of a matter. For advice on your specific situation, consult a qualified lawyer.