Are you looking to negotiate an agreement for your business? Are you uncertain about how to protect your rights? The best course of action is to hire a knowledgeable business lawyer, someone who knows the law and process, who has helped others in similar circumstances. With or without the counsel of a lawyer, there are steps you can take to protect your interests. This blog sets forth measures to take to ensure that you get the contract you want.
- Unless you are ready to be obligated, always make certain that you use language that conveys that any proposal is conditional and preliminary. ”Non-Binding Letter of Intent” or “Non-Binding Term Sheet” are good titles to use for this purpose. Contrary to popular belief, oral agreements can, in many instances, be enforceable as binding contracts. You need all parties to a negotiation to understand that your negotiations are preliminary only, and that a binding contract will be created only when memorialized in a final writing and signed.
- Your final contract must be in writing—Avoid the “He said, She said” or oral agreements.
- Document everything in writing—When you are involved in contract negotiations, with terms changing on a regular basis, confusion can arise. Before your attorney drafts the contract, you want to make certain you are in agreement on all terms.
- Consider all contingencies—In the excitement of securing a new contract, you may be inclined to ignore such issues as what will happen if there is non-performance, or if one of the parties is late with payment or delivery of goods or services. The more specific you can be up front, the less you will have to deal with if problems arise.
- There are three important parts of any well-drafted contract: a) how you get into or buy into the deal, b) how the deal or enterprise unfolds, and, very importantly, c) how you get out.
- Hire an attorney as soon as possible—Your lawyer will know the things you need to include in a contract to protect your interests. The money you save by trying to negotiate and draft your own agreements can quickly be lost when the terms of your agreement don’t address situations that commonly arise, or, if to your great regret and expense, litigation ensues.