Scenario 02

Skill: Extract Key Terms from Commercial Property Purchase and Sale Agreement

1. Subject-matter triage

• Treat the PSA as the primary source and the supporting diligence materials as issue-amplifiers, not replacements for the deal documents.
• Confirm whether the record set includes one property, multiple parcels, or layered ownership/occupancy interests; if multiple are present, separate the analysis by asset or interest before drafting the term sheet.
• Distinguish core economic terms from diligence-driven risk terms, then from mechanics and closing logistics.
• If the file includes client instructions or issue lists, treat them as controlling priorities for what to surface and flag.

2. Failure modes the skill is correcting

• Extraction is done from the PSA alone, so diligence findings that affect title, environmental risk, use restrictions, or closing risk are missed.
• The output is a flat recap instead of a topic-based term sheet that a real estate lawyer can use for underwriting and negotiation.
• Key terms are stated without section citations, exhibit references, or schedule cross-references, making verification difficult.
• Unusual, seller-favorable, ambiguous, or internally inconsistent provisions are described but not flagged as issues.
• Supporting documents are summarized generically rather than tied back to the specific PSA provisions they affect.
• The draft reads like a narrative memo instead of a deal term sheet with clear headings and issue calls.
• The work assumes one set of terms when the file may contain multiple properties, parties, contingencies, or closing tracks that must be separated.

3. Legal frameworks / domain conventions that apply

• Use standard PSA topic groupings: parties and transaction structure; property description and included/excluded assets; purchase price and deposit mechanics; due diligence and inspection rights; title, survey, and objection process; representations, warranties, and disclaimers; covenants between signing and closing; conditions to closing; casualty, condemnation, default, and remedies; prorations, closing costs, and closing deliverables.
• Cross-reference the PSA with any exhibits, schedules, addenda, disclosures, title commitments, surveys, environmental reports, lease abstracts, estoppels, or other diligence materials when they alter the meaning or risk profile of a PSA term.
• Read defined terms in the context of their definitions and any incorporated schedules; do not extract a term in isolation if its content is materially shaped by a definition or exhibit.
• Issue-spotting should focus on deviations from market expectations, ambiguity, internal inconsistency, missing protections, or mismatches between diligence findings and contract allocation of risk.
• When a provision depends on a legal standard or market convention, identify the governing doctrine or document-based authority in the analysis rather than implying a conclusion without support.
• When the agreement allocates obligations across periods or entities, note the operative timing and the responsible party.

4. Analytical scaffolds

• Read the entire PSA first, then the supporting documents, then return to the PSA to extract terms in light of the diligence record.
• Build the term sheet by topic, not by article order, but preserve each controlling section reference and any exhibit or schedule citation.
• For each topic, state the operative business term in plain language, then note the contractual source, then identify any issue or inconsistency.
• If the same concept appears in multiple places, synthesize it into one topic entry and cite all relevant locations.
• If the file contains more than one property, party, closing condition, date, or diligence issue, list the full set explicitly before analysis and keep the rows separate.
• For each identified issue, explain why it matters in transaction terms, how it interacts with another provision or document, and what the likely consequence is for the client.
• Give special attention to timing provisions, cure periods, election rights, notice mechanics, and survival/liability limits, because these often control the practical effect of the deal.
• Treat omissions as issues when a standard PSA topic is absent but should be present to understand risk allocation or closing mechanics.

5. Vertical / structural / temporal relationships

• Track the sequence from signing through due diligence, title/survey objections, cure periods, closing conditions, closing, and post-closing survival.
• Note how an issue in one document can change the operation of another provision later in the timeline, especially where diligence findings affect closing conditions, indemnities, or termination rights.
• If the PSA contains layered obligations that depend on a later event or election, make the dependency explicit so the reader can see the trigger, the actor, and the consequence.
• Where a term is shared across schedules, exhibits, and body provisions, identify which document controls if there is a conflict.
• If multiple assets or counterparties are involved, keep their rights and obligations separate so the term sheet does not blur distinctions that matter at closing or after closing.

6. Output structure conventions

• Deliver the output as a term sheet organized by topic with concise headings and subheadings that mirror a real estate attorney’s review path.
• Under each topic, include:
  • the extracted term in plain English,
  • the controlling PSA section and any related exhibit or schedule reference,
  • any issue flag with a short explanation of the concern.
• Use a consistent, readable format so each topic can be scanned quickly; do not bury source references inside prose.
• Make issue flags visually distinct from the extracted term, using a separate line or label.
• Where a topic is not expressly addressed in the PSA but is important for deal understanding, note the omission as an issue rather than inventing a term.
• Keep the document practical and client-facing: concise enough for use, but detailed enough to support negotiation and diligence review.
• Name the deliverable exactly as instructed: psa-term-sheet.docx.