HTML Preview Sales Term Sheet page number 1.
Attorney Feuerbach’s practice concentrates in real estate, business, construction, and
environmental law. Attorney Feuerbach obtained his LEED
®
Accredited Professional
(LEED AP) qualification in March 2009. 617-330-7136, pfeuerbach@rubinrudman.com
Copyright
July, 2012, Rubin and Rudman, LLP
This is an occasional information service provided by Rubin and Rudman, LLP
As such, it is required to be labeled “advertising” according to rules of the Supreme Judicial Court of MA.
1
1285477_1
T: 617.330.7000 F: 617.330.7550
50 Rowes Wharf, Boston, MA 02110
Peter J. Feuerbach
Direct Dial: 617-330-7136
E-mail: pfeue[email protected]
Real Estate, Business, Construction and Environmental Law Alert
10 Terms For Your Term Sheet
By: Peter J. Feuerbach, Esquire
Rubin and Rudman, LLP
617-330-7136
pfeuerbach@rubinrudman.com
masslegalalerts.blogspot.com
Clients often ask what steps they need to take to buy or sell (or invest in) a
business. Commonly, they need to finish hammering out the business terms with the
other side and then prepare a Term Sheet (or a Letter of Intent (LOI), or Memorandum
of Understanding (MOU)) to outline the principal business points.
The purpose of the Term Sheet is to create a road map for the transaction, so the
parties know where they are headed as they enter into the deal. Although the “typical”
Term Sheet is non-binding (more on that, below), it nonetheless is important to identify
the key terms the parties have “agreed to agree” on if they ultimately go forward. The
terms in the Term Sheet can be replaced with the final deal documents.
Here are “10 Terms for Your Term Sheet” for discussion with the other side along
with other items unique to your deal:
1. Price and Consideration: This should identify what the parties are
exchanging, for instance, a certain dollar amount in exchange for all or part of the
company or a certain parcel of land or interest in a building. In addition, discuss
whether the price will be paid in cash or some other property (e.g., stock in a company,
real estate, services, etc.) and if financing is involved.
2. Structure of the Deal: If it is a business sale, confirm whether it is an asset
purchase or a stock purchase. With an asset purchase, the buyer acquires certain assets