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Pre Contract Agreement for Nigeria

Pre Contract Agreement Template for Nigeria

This document serves as a preliminary agreement under Nigerian law, establishing the framework for negotiations between parties contemplating a significant commercial transaction. It outlines the parties' intentions, sets parameters for negotiations, and includes both binding and non-binding provisions. The agreement incorporates key elements of Nigerian contract law while providing mechanisms for confidentiality protection, exclusivity arrangements, and clear pathways for progressing toward a definitive agreement. It addresses specific requirements under Nigerian jurisdiction regarding formation of contracts and pre-contractual obligations, while also considering common law principles that form part of Nigerian legal system.

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What is a Pre Contract Agreement?

The Pre-Contract Agreement is a crucial document utilized in the Nigerian business environment when parties are entering into significant commercial negotiations but aren't yet ready to execute a final contract. It serves as a roadmap for negotiations while providing legal protection for the parties involved. This document is particularly relevant in complex transactions where detailed due diligence and extensive negotiations are anticipated. Under Nigerian law, while certain provisions of the Pre-Contract Agreement (such as confidentiality and exclusivity) are typically binding, others are explicitly non-binding to allow flexibility in negotiations. The agreement needs to comply with Nigerian contract law principles and may require consideration of specific regulatory requirements depending on the industry sector. It's commonly used in mergers and acquisitions, joint ventures, major supply contracts, and investment transactions where parties need to formalize their preliminary understanding while maintaining confidentiality and structure in their negotiations.

What sections should be included in a Pre Contract Agreement?

1. Parties: Identification of all parties to the agreement, including full legal names and addresses

2. Background: Context of the proposed transaction and purpose of the pre-contract agreement

3. Definitions: Definitions of key terms used throughout the agreement

4. Scope of Proposed Transaction: Overview of the main transaction being contemplated

5. Negotiation Process: Framework for how parties will conduct negotiations

6. Binding and Non-binding Provisions: Clear designation of which provisions are legally binding and which are not

7. Confidentiality: Obligations regarding confidential information exchanged during negotiations

8. Exclusivity: Terms preventing parties from negotiating with other parties during the negotiation period

9. Duration and Termination: Period of validity and circumstances under which the agreement can be terminated

10. Costs and Expenses: Allocation of costs incurred during the negotiation process

11. Governing Law and Jurisdiction: Specification of applicable law and courts having jurisdiction

What sections are optional to include in a Pre Contract Agreement?

1. Break Fee: Provisions for compensation if one party withdraws from negotiations, used in high-value transactions

2. Due Diligence: Framework for conducting due diligence investigations, included when significant investigation is required

3. Regulatory Approvals: Provisions regarding necessary regulatory clearances, included when regulatory oversight is relevant

4. Intellectual Property Protection: Additional IP protection provisions, included when significant IP will be disclosed during negotiations

5. Force Majeure: Provisions for unforeseen circumstances, included in longer-term pre-contract agreements

6. Assignment: Rights to assign the agreement, included when assignment possibilities need to be addressed

7. Public Announcements: Controls over public statements about the negotiations, included in high-profile transactions

What schedules should be included in a Pre Contract Agreement?

1. Schedule 1 - Timeline: Detailed timeline for negotiations and key milestones

2. Schedule 2 - Information Requirements: List of information and documents to be exchanged

3. Schedule 3 - Authorized Representatives: List of authorized representatives for each party

4. Schedule 4 - Term Sheet: Key commercial terms agreed in principle

5. Appendix A - Confidentiality Terms: Detailed confidentiality obligations and procedures

6. Appendix B - Due Diligence Requirements: Detailed due diligence procedures and requirements if applicable

Authors

Alex Denne

Head of Growth (Open Source Law) @ Ƶ | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Jurisdiction

Nigeria

Publisher

Ƶ

Document Type

Agreement Contract

Cost

Free to use
Relevant legal definitions






























Clauses





























Relevant Industries

Oil and Gas

Banking and Financial Services

Real Estate and Construction

Manufacturing

Telecommunications

Mining and Natural Resources

Agriculture and Agribusiness

Technology and Digital Services

Infrastructure Development

Healthcare and Pharmaceuticals

Power and Energy

Maritime and Shipping

Relevant Teams

Legal

Corporate Development

Mergers and Acquisitions

Commercial

Finance

Business Development

Compliance

Risk Management

Strategy

Operations

Project Management

Executive Leadership

Relevant Roles

Chief Executive Officer

Managing Director

Chief Legal Officer

Legal Counsel

Commercial Director

Business Development Manager

Chief Financial Officer

Investment Manager

Corporate Secretary

Compliance Officer

Risk Manager

Strategy Director

Operations Director

Project Manager

Procurement Manager

Industries







Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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