ICOnic News | Why Boilerplates Clauses are Your Secret Weapon in Contract Negotiation
WHY BOILERPLATE CLAUSES ARE YOUR SECRET WEAPON IN CONTRACT NEGOTIATION
When selling a company, or negotiating some other transaction, business people are often and understandably focused on the business terms, such as the purchase price or the payment terms. Ideally, the transaction will go smoothly and neither party will have a reason to fight down the road. However, if a dispute does arise, the terms in the back of the agreement-often referred to as the boilerplate provisions-can make all the difference. Here is a quick introduction to five of those provisions, what they are, and why they matter.
Choice of Law/Venue - in the event of a dispute, where will the fight occur and what law will apply? If the other side is from New York, will you be forced to litigate in their backyard, or will they have to fight in yours? Different venues have different approaches to legal issues and those differences stand to significantly impact your available rights and remedies. What are those differences? Which law will control? Also, should you agree to waive the right to a jury trial and, instead, let the judge decide the matter?
Arbitration - rather than litigating in federal or state court, should you consent to arbitration? Arbitration is the process by which a dispute is submitted, on the agreement of the parties or pursuant to a contract, to one or more arbitrators (often former judges and/or attorneys with subject matter expertise) who will make a binding decision. Which is faster? Which is more expensive? What are the pros and cons of each?
Limitation of Damages - can and should you agree to limit the available damages in the event of a dispute? What are consequential versus direct damages? Does the difference between the two matter?
Confidentiality - should the agreement contain a confidentiality clause? What should be the available remedy if a party violates its confidentiality obligations?
Attorneys' Fees - in the event of a dispute, should the "prevailing party" be entitled to recover its fees? Is the recovery of fees available without such a provision and, if so, can both sides recover? Just one? Neither?
Of course, my hope is that the transaction will close smoothly, but the reality is that post-deal issues can and do arise. When they do, the more thoughtful and intentional you were on the front end when negotiating these boilerplate provisions, and others, the better prepared you will be when a fight ensues.
- Alex Wolf - Senior Associate, Litigation Group at BoyarMiller
SERVING WITH LUNCHES OF LOVE
ICO believes that serving in our community is an essential part of our company's culture and is something that sets us apart and gives us a platform that helps to positively shape our community.
One organization and service opportunity that ICO has participated in for many years is Lunches of Love (LOL) located in Rosenberg. Lunches of Love is committed to helping end childhood hunger in the Fort Bend County community by providing children and low-income families a free sack lunch during the summer, extended school holidays and weekends. This summer LOL packaged over 82,000+ lunches with the help of 3,500+ volunteers and ICO was able to help package1,500 lunches for children the day we served.
Our ICO team had a great time serving together to package lunches and helping to support LOL in their endeavor to reach their goal of ending childhood hunger in Fort Bend County!
