Before entering a term sheet, you should decide whether the document is legally binding, partially binding or not at all binding. As a founder, you should be especially careful about binding commitments that affect your ability to work with other investors for too long, and be even more cautious of an investor who would like to impose a penalty on you if, for some reason, the terms of the letter are violated. Since the position cannot always be clear, legal advice and the development of clear legislation will eliminate most uncertainties. If in doubt, get a judged force of things. An appointment sheet implies the terms of a transaction as proposed by a party. It can be either binding or non-binding. An agenda gives you the opportunity to negotiate and ensure that all the terms of the agreement have been agreed before formalizing the agreement and issuing shares to your investors. The main difference is that an appointment sheet does not usually have to be legally binding, while shareholder agreements are legally binding. The advantage of the short format of the timesheet is first of all that it speeds up the process. Experienced consultants immediately know what is meant by “recording requirements at the transmitter`s expense, unlimited piggybacking at the issuer`s expense, weighted average anti-dilution”; He saves time for not having to express the long version of these references. Second, it is less likely that a court will find an unexpected change in sola, since the terminology sheet does not propose any agreement of any kind; A “declaration of intent” can be a dangerous document, unless it clearly states which parties should be binding and which parties merely guide the discussion and the project.
It is clear that parts of a terminology sheet can have a binding effect if and to the extent that an interpersonal reminder of certain binding promises, i.e. the confidentiality of the information provided during the negotiations, is necessary. However, the summary format of a term sheet makes it less likely that a party will be misled if it believes that a form of opposable agreement has remained in the memory if it has not.  All termsheets contain information about the assets, the initial purchase price, including any eventuality that could affect the price, a time frame for a response and other important information. A terminology sheet may be akin to a statement of intent (LOI) if the act is predominantly one-sided, as with acquisitions, or a discussion paper intended to serve as a starting point for more intense negotiations. The main difference between a LOI and a concept sheet is stylistic; The first is written as a formal letter, while the second is composed of enumeration signs that orients its terms. This roadmap is not a binding contract or agreement, but only an expression of a possible commercial transaction between the objective and the buyer.