When dealmakers make the decision to enter into a deal, parties will typically want to proceed full steam ahead. It is important to remember, however, that hasty decisions can lead to headaches down the line. Here are seven points to consider when preparing to enter into a buy-sell, merger, joint venture or other type of M&A transaction:

1. Be wary of term sheets that claim to be non-binding but create an agreement to negotiate in good faith. Most deals start with a term sheet (also known as a letter of intent or memorandum of understanding) that sets out certain terms of a transaction that have been agreed to between the parties. Recent precedent from Delaware has increased the likelihood that a term sheet may not be categorized as simply “an agreement to agree,” but instead may be construed under certain circumstances as an enforceable obligation. Moreover, in Delaware, expectation damages (based on lost profits) could be awarded for breach of a preliminary agreement, such as a letter of intent or term sheet, where some material terms are included but others remain open to negotiation.

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