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Common Paper Business Term Sheet

Common Paper's one-page non-binding term sheet for a business deal, such as a partnership or big sale, with a row per agreed topic and binding confidentiality.

By Common PaperUpdated
  • term sheet
  • non-binding
  • partnerships
  • Common Paper
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About this document

A business term sheet is a short, non-binding summary of the main points two companies have agreed, written before lawyers draft the full contract. This is Common Paper's Term Sheet, shown word for word as Common Paper publishes it, without a version number.

Use the Common Paper Business Term Sheet for a partnership, reseller deal or large sale, where you list each agreed topic in its own row. For a customer committing to a product you are still building, the Common Paper Letter of Intent has set fields. For an investment, use a financing term sheet such as the Series Seed Preferred Stock Term Sheet. Only the confidentiality section binds the parties, so neither side has to sign the final deal.

How to fill it in

  1. List each agreed topic. Add one row per topic, such as price, scope, territory, timing or exclusivity, and write what you agreed in plain words. Add or delete rows as needed.
  2. Keep the confidentiality section. Leave the confidentiality section as written. It is the only part that binds both companies, and it covers what each side shares during the negotiation.
  3. Sign for both companies. Enter each company's official name, and have a person who can speak for each company sign, print their name and title, and add a contact address and date.
Common Paper Business Term Sheet

Term Sheet

This non-binding Term Sheet ("Term Sheet") expresses our mutual excitement and intention to work together as detailed below. Final details, terms, and conditions will be as mutually agreed in a separate, binding agreement ("Definitive Agreement"). This Term Sheet is meant to assist our negotiation of the Definitive Agreement. As such, this Term Sheet is non-binding and no liability nor obligation is intended to be created between either of us, except for the portion called Confidentiality. This Term Sheet does not require either of us to enter into a Definitive Agreement nor does it preclude the Definitive Agreement from including additional provisions.

Our current intentions are as follows:

[ Topic ]

[ details about the topic ]

[ Topic ]

[ details about the topic ]

Confidentiality

We each have or may disclose information about our company that is confidential or proprietary in nature or that should be reasonably understood as confidential or proprietary due to its nature and the circumstances of its disclosure ("Confidential Information"). Neither of us will (a) use the other's Confidential Information; nor (b) disclose the other's Confidential Information to anyone else except as required by applicable law. In addition, we each will protect the other's Confidential Information using at least the same protections that we use for our own similar information but no less than a reasonable standard of care.

By signing this Term Sheet, each party acknowledges their intent as outlined in the Term Sheet and agrees to the confidentiality terms.

PARTY 1: [official company name]

PARTY 2: [official company name]

Signature

Print Name

Title

Contact Address

Date

Common Paper Term Sheet free to use under CC BY 4.0.

Page 1 of 1268 words

Frequently asked questions

Is a term sheet legally binding?

Mostly not. The Common Paper Term Sheet says it is non-binding and creates no obligation except its confidentiality section, and it does not require either side to sign a final agreement. Rules vary by state, and wording that reads like a firm promise can still create obligations.

What goes in a business term sheet?

The points both sides have agreed and want the final contract to reflect, such as price, scope, length, territory, exclusivity and who does what. Leave detailed legal terms, such as liability limits, to the full contract. The Common Paper Term Sheet gives one row to each topic.

What is the difference between a term sheet and a contract?

A term sheet records the deal points while the parties are still negotiating, and it is usually non-binding. The contract, which Common Paper calls the definitive agreement, is the signed document that creates the actual obligations. A term sheet makes the contract faster to draft.

Related documents

Common Paper Letter of Intent

Common Paper's non-binding letter of intent between a provider and a customer: the product, what it does, fees, launch date and five confidentiality options.

Referral and Co-Marketing Partnership Agreement

Common Paper's standard partnership agreement, version 1.1, for referral, co-marketing and sponsorship deals, with a cover page for each side's duties and fees.

Common Paper Mutual NDA

Common Paper's standard mutual NDA, version 1.0: a one-page cover page for the purpose, term and governing law, plus standard terms both sides keep as written.