A heads of agreement (HoA) in an Australian M&A context is a preliminary document setting out the principal commercial terms agreed between buyer and seller before the formal share sale or asset sale agreement is drafted. Most provisions are non-binding (subject to formal documentation), but specific clauses such as exclusivity, confidentiality, and costs are typically expressed as binding.
The terms agreed in the heads of agreement substantially shape the eventual deal; renegotiating them later is difficult.