This article posted to our partner site Mondaq.com discusses the legal risks associated with letters of intent or term sheets, namely, that they can be found to be a binding agreement between the parties.
Cases dealing with this issue normally turn on the language of the letter, as well as the oral communications and actions of the party. The article also suggests dividing the document into two (2) distinct sections and labelling them as ”binding provisions” and ”non-binding provisions” in order to avoid any unwanted consequences.