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term sheets could be handshake agreements or two-pager documents which define the terms at which an investor puts money in a startup a lot of times founders are expected to sign them and send them back to the investor but are these term sheets legally binding well not as much as the definitive agreements which is the shareholders agreement and the share subscription agreement which follows these term sheets however there are certain clauses of the term sheet which could come back and bite the startup founder in the posterior if not followed one pertaining to confidentiality which means they will not go disclose the terms to anyone and the second could be a no-shop clause which means you will not use this term sheet to go to other proposed investors and fetch better terms for yourself share it with the star of founder you know
