What is the difference between a term sheet and a letter of intent?

What is the difference between a term sheet and a letter of intent?

A term sheet outlines the key terms of a deal, while a letter of intent expresses interest in a transaction.

Can you give me examples of what might be included in a term sheet?

Sure! A term sheet typically includes details like the purchase price, payment terms, and timelines.

And what about a letter of intent? What does that usually contain?

A letter of intent usually includes the parties involved, the purpose of the agreement, and any preliminary terms.

Which one is more legally binding?

Generally, a term sheet is more binding than a letter of intent, but it depends on the specific language used.

Are there situations where one is preferred over the other?

Yes, a term sheet is often preferred in later stages of negotiations, while a letter of intent is used earlier to show interest.