Heads Of Agreement Template
What is a Heads of Agreement?
A Heads of Agreement template is a non-binding document outlining the main issues agreed between two parties before entering into a full legally binding agreement. It’s a useful document to be used during the negotiation stages, and allows you to record proposed terms which will be invaluable when the time comes for further documentation.
Why do I need This?
It acts as a guideline for the roles and responsibilities of the parties involved which may include investing in a company, buying or selling a business or setting up a partnership. It will come in handy when it comes time to enter into a legally binding agreement – since you have a paper record this will allow for a smooth and streamlined process, and minimise any conflict.
What’s the Main Benefit?
This agreement gives the parties involved a degree of confidence that a deal is probable before the parties incur further expense.
Additional key points for a Heads of Agreement is to provide:
- a framework for the parties to negotiate a final contract;
- a record of key terms agreed on to date;
- evidence of a party’s commitment for the benefit of third parties such as banks or potential investors;
- a mechanism for dealing with pre contractual issues such as exclusivity, confidentiality, due diligence and intellectual property