Legal Prior to Contract Template

LEGAL PRIOR TO CONTRACT TEMPLATE

This Pre-Contractual Agreement (the "Agreement") is made on Effective Date: by and between Party A: , Entity Type: , Address: ; and Party B: , Entity Type: , Address: .

Recitals

WHEREAS, the parties have engaged in discussions concerning the potential negotiation and execution of a definitive contract regarding: (the "Proposed Contract");

WHEREAS, the parties desire to set forth certain agreed pre-contractual terms, allocation of costs, obligations of confidentiality, and the framework for further negotiation prior to entering into the Proposed Contract;

WHEREAS, the parties intend that certain provisions of this Agreement shall be binding notwithstanding the non-final status of the Proposed Contract, as expressly set forth below.

NOW, THEREFORE, in consideration of the mutual covenants contained herein and other good and valuable consideration, the receipt and sufficiency of which are acknowledged, the parties agree as follows:

1. Definitions

1.1 "Confidential Information" means all non-public information, whether oral, written, electronic or other tangible form, disclosed by one party to the other in connection with the Proposed Contract, including but not limited to business plans, technical data, pricing, financial information, customer lists, proposals, and trade secrets, and any summaries, analyses or copies thereof.

1.2 Terms defined elsewhere in this Agreement have the meanings ascribed to them in the sections in which they appear.

2. Purpose

The purpose of this Agreement is to record certain pre-contractual understandings and to establish procedures for negotiation of the Proposed Contract, including allocation of negotiation costs, the treatment of Confidential Information, and any exclusivity during the negotiation period.

3. Scope and Material Terms

3.1 Material commercial terms that the parties intend to negotiate include, without limitation: term/duration, fees or pricing, scope of services or deliverables, key milestones, and termination rights. A non-exclusive summary of those material terms is set forth below:

3.2 The summary in Section 3.1 is intended for negotiation guidance only and is not a substitute for definitive contractual language in the Proposed Contract.

4. Confidentiality (Binding)

4.1 Each party shall hold in strict confidence and not disclose Confidential Information of the other party to any third party, except (a) to employees, agents and advisors with a need to know who are bound by confidentiality obligations at least as restrictive as those herein, (b) as required by law, or (c) with prior written consent of the disclosing party.

4.2 Confidential Information does not include information that: (a) is or becomes publicly available without breach of this Agreement; (b) was rightfully in the receiving party's possession prior to disclosure; (c) is rightfully received from a third party without restriction; or (d) is independently developed without use of the other party's Confidential Information.

4.3 The obligations in this Section 4 shall survive termination or expiration of this Agreement for a period of three (3) years, except that trade secrets shall be protected for so long as they qualify as trade secrets under applicable law.

5. Exclusivity and Good-Faith Negotiation (Optional Binding)

5.1 For the negotiation period set forth below, the parties agree that they will negotiate exclusively and in good faith with each other regarding the Proposed Contract. The negotiation period shall commence on the Effective Date and continue until unless earlier terminated pursuant to Section 11.

5.2 Either party may seek injunctive relief to enforce the exclusivity obligations, and such remedy shall be in addition to any other available remedies at law or equity.

6. Non-Binding Nature of Negotiations

6.1 Except for Sections 4 (Confidentiality), 5 (Exclusivity), 9 (Notices), and Sections 13 through 16 (Governing Law, Entire Agreement, Severability, Counterparts), the parties expressly acknowledge that this Agreement does not create any obligation on either party to enter into the Proposed Contract and that neither party shall be liable for failure to enter into such contract.

7. Expenses

Each party shall bear its own expenses incurred in connection with the negotiation of the Proposed Contract unless the parties otherwise agree in writing. No obligation to reimburse the other party for expenses shall arise except pursuant to an express written agreement signed by both parties.

8. Representations and Warranties

Each party represents and warrants that (a) it has the full right, power and authority to enter into this Agreement, (b) the individual signing on its behalf is authorized to do so, and (c) this Agreement constitutes a valid and binding obligation enforceable in accordance with its terms.

9. Notices

Notices to Party A

Notices to Party B

Notices shall be in writing and shall be deemed given upon receipt when delivered personally, by nationally recognized overnight courier, by certified mail (return receipt requested), or by confirmed electronic delivery to the contact information set forth above.

10. Amendments and Waiver

No amendment or waiver of any provision of this Agreement shall be effective unless set forth in a writing signed by the party to be bound. A failure or delay to exercise any right shall not constitute a waiver of that right.

11. Termination

Either party may terminate this Agreement upon written notice to the other party. Termination shall not relieve either party of obligations accrued prior to termination, including obligations of confidentiality and payment of expenses agreed pursuant to this Agreement.

12. Counterparts; Electronic Signatures

This Agreement may be executed in counterparts, each of which shall be deemed an original, and all of which together shall constitute one and the same instrument. Signatures delivered electronically or by facsimile shall be deemed original for all purposes.

13. Severability

If any provision of this Agreement is held invalid or unenforceable by a court of competent jurisdiction, the provision shall be reformed only to the extent necessary to make it enforceable, and the remaining provisions shall continue in full force and effect.

14. Entire Agreement

This Agreement constitutes the entire agreement between the parties with respect to the subject matter hereof and supersedes all prior oral or written communications, understandings, or agreements relating to such subject matter, except for any separate confidentiality agreement in effect between the parties.

15. Governing Law

This Agreement shall be governed by and construed in accordance with the laws of the State of without regard to its conflicts of law principles. The parties submit to the exclusive jurisdiction of the state and federal courts located in that State for resolution of disputes arising under this Agreement.

16. Miscellaneous

16.1 No Third-Party Beneficiaries. This Agreement is intended for the benefit of the parties and their permitted successors and assigns and is not intended to confer any rights on any other person.

16.2 Further Assurances. Each party shall execute and deliver such further documents and take such further actions as may be reasonably required to carry out the intent of this Agreement.

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