Free Preliminary Agreement Template
Preliminary Agreement
This preliminary agreement ("Agreement") is entered into on [Effective Date], by and between [Your Name] (hereinafter referred to as the "First Party") and [Business Partner's Name] (hereinafter referred to as the "Second Party").
I. Purpose of the Agreement
Both parties involved come to a mutual agreement and understanding that the primary purpose of this Agreement demonstrates their initial intent to commence a potential business relationship in the future.
This Agreement functions as an initial comprehensive understanding between both parties and falls short of and does not legally bind either party into a contractual relationship.
Both parties understand and recognize that the specific terms and conditions that are outlined within this Agreement are not final. They are rather, still open to further negotiation and discussions, and there may be possibilities for alterations or changes once the Definitive Agreement is established.
II. Terms and Conditions
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Scope of Relationship: The Parties plan to pursue a joint venture to create and market a new healthcare software, utilizing mutual expertise and resources for a successful, innovative product for healthcare providers to enhance patient care.
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Due Diligence: Both Parties shall conduct due diligence on each other's businesses, including financial, legal, and operational aspects, to assess the feasibility and desirability of the proposed relationship.
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Non-Binding Nature: This Agreement, as it currently stands, is not legally binding, nor does it impose any type of legal obligation on either the first or the second Party. This agreement should not be interpreted as a requirement for either Party involved to enter into a definitive and binding agreement or contract.
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Expenses: Each Party shall bear its own expenses related to the negotiation, due diligence, and preparation of the Definitive Agreement, unless otherwise agreed in writing.
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Confidentiality: The Parties agree to maintain the confidentiality of all information exchanged during the negotiation process, including but not limited to financial information, business plans, and technical data.
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Term: This Agreement is set to begin on the Effective Date. It will continue to be enforced and applicable until such time that it is terminated, following the procedures and conditions that are provided and set within this document.
III. Confidentiality
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Confidential Information: The Parties agree to treat all information exchanged during the negotiation process as confidential. This includes, but is not limited to, financial information, business plans, and technical data.
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Use of Information: The Parties have come to a mutual agreement whereby they will use the Confidential Information with the sole intention and exclusive purpose of both evaluating and negotiating the proposed business relationship that is under consideration.
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Non-Disclosure: The parties involved in this agreement are strictly not permitted to share, disseminate, or divulge any information considered as confidential, to any third-party individuals or entities. This condition can only be bypassed if there is a prior written and formal consent provided by the party which originally disclosed or provided the said confidential information.
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Survival of Obligations: The responsibilities pertaining to maintaining confidentiality, as per this agreement, will continue to persist even after the completion or termination of this Agreement itself.
IV. Negotiation Process
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Commencement of Negotiations: The Parties involved have reached a consensus that they will begin to undertake negotiations swiftly and without any undue delay, and this will occur immediately after the execution and implementation of this Agreement.
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Negotiation Period: The Parties shall negotiate in good faith and use their best efforts to reach agreement on the terms of the Definitive Agreement within [specify a reasonable time frame, e.g., 60 days] from the Effective Date of this Agreement.
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Extension of Negotiation Period: Should the Parties find that they need additional time to perform their negotiations, it is permissible for them to both agree, with mutual consent, in a written format, towards the extension of the period dedicated specifically for these negotiations.
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Termination of Negotiations: If the Parties are unable to reach an agreement within the negotiation period, either Party may terminate this Agreement by providing written notice to the other Party.
V. Termination of Agreement
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Automatic Termination: This Agreement shall automatically terminate upon the execution of the Definitive Agreement.
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Termination by Notice: Either Party can end this Agreement by sending a written notice, effective [e.g., 30 days] after it's sent. Upon termination, both Parties must immediately return or destroy any Confidential Information from the other and won't have any responsibilities under this agreement, except those specified to continue after termination.
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Effect of Termination: Upon termination of this Agreement, each Party shall promptly return or destroy all Confidential Information received from the other Party. Additionally, the Parties shall have no further obligations under this Agreement except those that expressly survive termination, including the confidentiality obligations set forth herein.
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Survival of Obligations: The obligations that pertain to confidentiality and non-disclosure, as mandated by this Agreement, shall continue to remain in effect and will not cease to exist even after the termination or conclusion of this Agreement.
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Termination for Cause: Either Party may terminate this Agreement immediately upon written notice to the other Party if the other Party breaches any material provision of this Agreement and fails to cure such breach within [specify cure period, e.g., 15 days] after receiving written notice of the breach.
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Rights and Remedies: Termination of this Agreement shall not prejudice any rights or remedies that either Party may have against the other Party for any breach of this Agreement occurring prior to termination.
VI. Governing Law
The Agreement stated herein, inclusive of all the provisions, terms, and conditions detailed within its content, will be subject to strict regulation by and will be interpreted in accordance with, the legal systems, norms, legislation, and regulations specifically pertinent to the jurisdiction of the [State/Country] where it is applicable and holds relevance.
The laws and legal principles formulated within the geographical and jurisdictional confines of the [State/Country] will provide integral guidance and act as the foundation of the legal basis upon which this agreement stands and is to be understood and executed.
VII. Entire Agreement
The Agreement presented herein stands as a full and comprehensive representation of the mutual understanding that has been arrived at between the Parties involved, with respect to the subject matter specifically mentioned in this document.
It carries with it the intention to supersede, invalidate, and replace any and all agreements and understandings that may have been previously established between the Parties.
This clause applies irrespective of how these previous agreements and understandings were expressed, be it documented in written form or simply articulated verbally. It is important to highlight that this Agreement is specifically tailored to address the said subject matter only, as explicitly stated within the content of this document.
VIII. Counterparts
This Agreement has the capability to be executed in any specified number of counterparts. It is important to note that every single one of these counterparts shall be considered an original in itself.
However, when all these counterparts are brought together, they shall not be viewed as separate entities. Instead, they will be collectively recognized, considered, and treated as one single instrument or entity.
IX. Signatures
IN WITNESS WHEREOF, the Parties have executed this Agreement as of the Effective Date first above written.
First Party:
[Your Name]
Date: [Date Signed]
Second Party:
[Business Partner's Name]
Date: [Date Signed]
