When a consultant breaches his or her consulting agreement, he or she is subject to remedies available to the company. These remedies are typically provided for in the agreement, and often include equitable relief and/or monetary damages.

Equitable relief refers to non-monetary remedies “in equity” that the Court can provide to a non-breaching party, such an injunction (the Court saying the consultant must refrain from doing something) or an order commanding specific performance (the Court saying the consultant must do something.) An injunction against the breaching consultant helps prevent any further breach of the agreement. A typical injunction might prevent the consultant from performing similar consulting work for a competitor, if the Judge finds that the consultant is in breach. Another injunction might prevent the consultant from sharing any confidential information, if the company asserts that the consultant breached the non-disclosure provision of the consulting agreement.

It may also be possible to enforce specific performance under the agreement - especially if the consultant was hired to perform specific duties that only he or she has the knowledge and ability to complete. Specific performance means that the consultant must follow through on his or her obligations under the agreement. To enforce the agreement specifically, the Court will have to find that the services can only be provided by the breaching consultant and that monetary damages are insufficient to address the breach.

If a court does enforce an injunction and refuses to require specific performance because the services can be performed by another party or for other reasons, the court will likely award monetary damages. The most common form of monetary damages is “compensatory damages”, meaning damages awarded to the non-breaching party that serve to “make whole” that party. These damages would likely be the cost incurred by the company to replace the breaching consultant.

Popularity: 11% [?]

Consulting agreements are commonly used by businesses today. Consulting agreements can range from one page to 20 or more pages depending on the subject matter of the agreement and whether other agreements between the parties are included or are incorporated by reference. This summary will discuss in more detail the terms of the Sample Consulting Agreement form and the legal rights and obligations created under the agreement, as well as provisions that could be adapted to specific circumstances and arrangements.

Provisions of the Agreement and Duties and Obligations Created

The consulting agreement is an agreement between a consultant and a client that wishes to retain certain specified services of the consultant for a specified time at a specified rate of compensation. As indicated previously, the terms of the agreement can be quite simple or very complex. Below is a discussion of the more important issues to be considered in every consulting agreement.

Scope of Work; Time; Compensation

It is important that the agreement for consulting services outline the specific services to be provided. Often a consulting agreement will contain an exhibit that lists the services expected of the consultant. This list can then be amended if necessary without the need to amend the entire agreement.

The time period in which the consultant is expected to complete his or her task should also be included in the agreement if applicable. Depending on the situation, the consultant may be expected to devote a specific number of hours per week or per month to the project, or may charge a flat fee when the services are more specific in nature. The hiring company may wish to include a “hold-back” provision alerting the consultant that a certain amount of the compensation will be withheld until the consultant has completed the task. Obviously, the inclusion of a hold-back provision and the amount that is “held-back” are often points of contention and should be negotiated.

Term and Termination

The term of the agreement is typically quantified in months or years. Most likely it will coincide with the compensation schedule. The client should also protect its interests by allowing it to terminate the agreement under certain conditions. Typically these conditions are (1) breach of confidentiality or non-solicitation provisions of the agreement, or (2) illegal activities that affect consultant’s performance under the agreement. Without this right to terminate the agreement, the client is obligating itself to the consultant even if the consultant has taken actions contrary to the client.

Copyrights and Data

The consulting agreement should address the use of the consultant’s work. Some agreements allow the client complete use of the physical product delivered by the consultant and may not include an assignment of copyright on the assumption that the consultant will want to retain the copyright. The best position for the client is to get complete ownership of not only the tangible documents that the consultant prepares, but also the copyrights to those documents. However, the consultant may demand considerable more compensation to assign this right making it impractical. It is very important, however, for the parties to clearly understand their respective rights relating to not only the physical documents but the copyrights as well.

Conflict of Interest; Non-Solicitation

Clients should consider including a non-competition clause in the agreement, at least for the term of the agreement and within the market area of the client. Any non-competition clause must be reasonable to be enforceable. Most consulting agreements also include a statement that the consultant will not solicit the client’s employees for at least the term of the agreement.

Miscellaneous Provisions

After spending considerable time negotiating the services to be performed, the compensation, the ownership rights to the work product, etc. it is often easy for parties to neglect the miscellaneous provisions that one typically finds at the end of the agreement. The parties should always pay careful attention to what law will govern the agreement, how disputes will be resolved, and, probably most importantly, the assignability of the rights and obligations under the agreement. Typically, the rights and obligations are not assignable since the client is hiring the consultant because of the consultant’s specific expertise and the consultant is agreeing to perform the services only for the client. There may be situations, however, where an assignment may be necessary, i.e. the client merges with or into another entity.

Summary

Consulting agreements are frequently used in today’s business world and vary in complexity from simple, one-page documents to very complex, 20+ page documents. The terms detailed above, however, should be considered as basic requirements for any consulting agreement. With the key terms detailed in a written agreement, the parties will have reasonable expectations about services to be performed under the agreement and the consequences if those expectations are not met.

Popularity: 14% [?]

An exclusivity agreement is a written agreement in which two or more parties agree to have business dealings only with one another, to the exclusion of third parties. Exclusivity agreements can span days or years, depending on the area of law involved. They can also be bilateral or unilateral.The majority of exclusivity agreements are found in the commercial buyer-seller relationship, in mergers and acquisitions, and in real estate.

In commerce:
• Usually used to restrict the buyer from buying from only one seller, such as Ford having to buy all its steel from only US Steel.
• Can happen in reverse, where US Steel must sell all its steel only to Ford, but less common.
• Agreements can last months, even years.

In mergers and acquisitions:
• Used to focus two parties on their potential merger, to exclude other partners/targets.
• Span the discussion phase, usually a few weeks or months.
• Allow for access to files, so due diligence can occur.
• Parties are exclusive with one another, but no agreement to consummate a deal.
• Termination-expiration or one party terminates early, when deal is not likely.
• Includes provisions to refrain from making decisions that materially change business during the exclusion period.

In real estate:
• Called Exclusive Listing Agreements.
• Homeowner grants only one realtor (or company) access to home and sale-homeowner “locked in.”
• One catch-homeowner can cancel agreement, but realtor may still get commission if house sells within 30 days of cancellation.

Popularity: 13% [?]

Exclusivity agreements, because they are present in a number of different areas of the law, come in a variety of forms and are designed to meet a range of goals. The overriding purpose of each exclusivity agreement is, however, to define a relationship in which (generally) two parties agree to deal only with one another, to the exclusion of third parties. The duration of the agreement; whether it is bilateral or unilateral in its rights and restrictions; if it includes only two parties or perhaps more-all such matters are dependent to a large degree on the area of law from which the agreement springs.Today, one is most apt to find exclusivity agreements in three different areas of the law-in the commercial world, in mergers and acquisitions, and in real estate.

When two commercial parties deal with one another, they may sign an exclusivity agreement to solidify the economic relationship between them and to prevent third parties from interfering. The nature of this sort of exclusivity agreement-and the desire to build stability into the relationship-means that such agreements can endure months or years-until the bargaining power of one or the other party materially changes. Often, the relationship is one between buyer and seller, and the seller obliges the buyer to purchase its goods only from this seller and not from the seller’s competitors. An example of this situation would be Del Monte obliging Whole Foods grocery stores to buy all of its bananas only from Del Monte and not from Chiquita or another grower. Certainly, the opposite situation can occur, as well: Whole Foods could lock in Del Monte such that the latter could sell its bananas only to the former. This scenario is much less common, however.

Two companies contemplating a merger sign an exclusivity agreement to prevent one or both of the parties from seeking other third party targets or partners. Shorter in length, these agreements keep the parties’ attention focused during the discussion phase. Inherent to these agreements are certain provisions, such as articles on access, no agreement, termination, and changes. The parties allow one another access to files and pertinent data. The parties are of course bound by confidentiality provisions, especially if the deal is not consummated. Just such a scenario is dealt with in the “no agreement” provision, which states that even though the parties are dealing exclusively with one another, they under no duty to conclude a deal. They can walk away, in other words. A termination provision talks about the natural expiration of the agreement or early termination by one of the parties. And finally, certain provisions in the agreement may well forbid parties from making material changes to the way the business is run during the exclusion period.

Realtors use exclusivity agreements-called exclusive listing agreements-throughout their business. When a homeowner signs an exclusivity agreement, he is agreeing to use only one realtor-or that realtor’s company-to sell his home, including listing it, showing it, and closing the sale on it. No other realtor may interfere with the transaction, and the homeowner is “locked in,” as they say. The homeowner, for his part, receives the benefit from the realtor’s resources, such as the latter’s business acumen or large register of buyers. The homeowner is free at any time to cancel the exclusive listing agreement. However, to do so can carry a penalty. If the home is sold to a buyer within (usually) 30 days of the agreement’s cancellation and the buyer was brought in by the realtor, then the realtor in question is still entitled to collect a commission on the sale.

Popularity: 16% [?]

A severance agreement is a formal written agreement between a company and one of its executives to compensate the executive for relinquishing certain of his rights in the event that his employment is terminated by the company.Two common scenarios in which the severance agreement is present are 1) when a company lays off a number of employees, including the executive, and 2) when a company desires to let go of a liability in the person of a specific executive. In these cases, the company will entice the executive, prior to his termination, to sign a severance agreement in exchange for giving up certain of his rights. Primarily, these rights are claims that the executive might bring against the company for disputed wages, discrimination, or wrongful termination.

Severance agreements are not compulsory. But they are a form of goodwill, for the terminated executive can be mollified and the remaining executives can be comforted through their use. No law obligates a company to provide severance agreements. However, if a company uses them, the company and the agreement must conform to certain legal strictures. For one, the agreement must be in writing. For another, the company must allow the executive a reasonable period of time to consider the agreement and to consult a lawyer. Additionally, the executive is afforded a statutory period of time in which he may revoke his acceptance of the agreement.

Importantly, despite the fact that the severance agreement has been labeled a legal bribe, the existence of severance agreements does not give companies carte blanche to intimidate their executives. That is, a severance agreement must offer the executive an additional incentive to what he is already due. The company may neither offer to pay the executive what he has already earned (salary, bonuses, benefits), nor threaten to withhold the same. The severance agreement is meant to be an additional carrot.

It may happen that a company will have a de facto severance agreement, whereby executives are compensated in the event of termination, but no written company guidelines exist to govern the process. This can be tricky for both sides, but if the executive can establish company patterns that support a de facto severance system, then he will likely prevail.

An executive may reject the agreement and perhaps should if he believes he has a legitimate grievance against the company that may entitle him to greater compensation than what the severance agreement offers. Alternatively, he may also counter the company’s offer with a more favorable one. There is a caveat, however. The executive’s counteroffer is effectively a rejection of the company’s offer, and the company is not obliged to maintain its offer after the executive has put forward a counteroffer. That most companies do just this in the normal course of business should not overshadow the fact that a counteroffer could theoretically leave the executive empty handed after his termination.

Severance agreements consist of compensation elements (base pay for a year or several; bonuses; stock options; health benefits perhaps); restrictive covenants (declarations not to bring claims against the company; turning over of proprietary company material); and other agreements (the company’s agreement to provide letters of recommendation or to help finding the executive another job). Many agreements also contain confidentiality and non-compete clauses that limit the executive’s ability to hurt the company after his termination. These clauses must protect the company’s legitimate business interests without impinging on the executive’s ability to work. It happens, of course, that companies overzealously protect themselves and try to hold their executives to unreasonable confidentiality and non-compete clauses.

Popularity: 8% [?]

An asset purchase agreement is the written agreement by which one company buys another company. Asset purchase agreements define the assets and liabilities to be sold. The buyer is purchasing whatever the two parties define as “the Business,” including the rights to conduct this Business. Asset purchase agreements are very commonly used agreements, but that is not to say that they are simplistic documents. Because they are concerned to a large degree with delineating and controlling the behavior of the buyer and the seller, asset purchase agreements are often lengthy documents, replete with provisions that limit the actions of the parties.Some of these provisions, which no asset purchase agreement should be without, include;

1. A definitions section, where the parties define their own universe, to a degree;

2. A section on assets and liabilities, both assumed (those that are part of the deal) and excluded (those that are not);

3. A closing provision;

4. A section on the purchase price that answers the pertinent questions of how much, when, and in what manner;

5. Representations and warranties of the seller, representations and warranties of the buyer; the former being more important;

6. Covenants and agreements, such as non-competition, non-disclosure, any duties to comply with the law;

7. Conditions to the closing, such as that everyone who needs to agree to the deal does in fact agree to the deal;

8. A termination provision, by mutual agreement, or for breach, undue delay at the closing, a governmental action, or an inability to perform due diligence;

9. Indemnification provisions for buyer and seller, in the event that one party is mistaken in its representations, or worse, lies; and

10. Miscellaneous provisions, such as those dealing with governing law or assignment.

Popularity: 7% [?]

A change of control agreement is an agreement between a company and one of its executives to safeguard the remunerative rights of the executive in exchange for his continued service with the company. If a company undergoes a change of control and if the executive is fired without Cause or quits for Good Reason following this change of control, the company will pay out a severance package to the executive, usually consisting of his salary (several times over) and stock options. The theory behind the change of control agreement is that an executive can better focus on his fiduciary duties when he’s not worried about losing his job in a hostile takeover.There are a number of points to look for in a change of control agreement:

1. A change of control, be it:

a. the sale, lease, or other conveyance of the company’s assets;

b. the acquisition of 20% of the company’s outstanding common stock in one year;

c. a merger or consolidation;

d. a change in the majority of the Board members;

e. a decision by the Board to dissolve or liquidate the company; or

f. a resolution by the Board that states that a change of control has occurred.

2. Definition of Cause

3. Definition of Good Reason

4. Death / disability provisions

5. Gross-up provisions

6. The term, and of course…

7. The benefits that may result from a change of control-severance pay, stock options, and the like.

Popularity: 8% [?]

I have always wondered about my legal rights and responsibilities as a blogger. Our tech-culture is based around the rapid universal exchange of information. Sometimes this information is fact, sometimes it’s opinion. For our readers, this line between fact and opinion is often blurry, since a portion of them reach our sites after searching for the answer to a question. This scenario is creating questions by concerned bloggers regarding their legal responsibility for the information they put out for the public. I began to ponder this subject so I turned to my trusty search engine and started inputting some terms. After some searching to no avail, I switched up my keywords and I came across this article over at Lawfuel that states:

“The importance of individual responsibility in posting messages online was raised further last month following the conviction of a blogger in Flintshire, Wales, who posted offensive messages about a police officer’s new-born baby and wrote about his perceived mistreatment at the hands of the police and Crown Prosecution Service. He was prosecuted under the Telecommunications Act, relating to the sending of an electronic message”

While reading this scenario I’m sure everyone assumed that there would be some sort of punishment at the hands of the police for this kid. Duh. It is a pretty serious situation to write about a police officer and his child on the internet. But what about situations that aren’t as blatantly malicious. We must keep in mind that any one of us can come under fire for content we post that we think is not that serious or offensive. For this reason, you should play it safe. Look at some of these categories, steer clear of them, and happy blogging!

“User Generated Content: Some of the legal pitfalls:

Defamation: This country has tough libel laws and from the earliest Web 1.0 bulletin boards posters have got into difficulty with defamatory comments - as have the online services that carry them.
Offensive Messages: There are a range of laws from the Protection from Harassment Act to specific restrictions in the Telecommunications Act that can be invoked.
Incitement: There have been high profile cases relating to terrorism but any encouragement of others to commit unlawful acts can result in prosecution.
Intellectual property: There is a copy and paste culture online, but using other people’s material (whether it’s an article, photograph, logo or even another blog posting) can cause problems.
Linking: Bloggers need to think about what is on their own site, but also keep an eye on the links they provide to other pages e.g. to offensive or illegal material.
Reporting: The law of contempt and other statutory reporting restrictions carry strict penalties if breached.
Corporate blogging: The legal pitfalls can be even more pronounced in the case of corporate blogs where additional commercial concerns will apply.”

If you want to take a look at the whole article, check it out.

Popularity: 7% [?]

RealDealDocs.com offers various online legal documents from agreements to contracts for your downloadable and printable convenience. In this release is the THL Managers V LLC management agreement drafted by Amlaw top profit per partner law firm Weil Gotshal that has been released by RealDealDocs.com.

Boston, Massachusetts – RealDealDocs.com, a major resource for online sample legal documents has just released the THL Managers V LLC management agreement drafted by Amlaw top profit per partner law firm Weil Gotshal.

A management agreement is a legal document in which the Provider agrees to provide the Management Services as defined in the agreement. The THL Managers V LLC management agreement with the Simmons Company was produced as a result of a merger between subsidiaries of the two companies and includes details on the terms of services, payment of fees, length of term, and indemnification.

RealDealDocs.com presents a free copy of the THL Managers V LLC management agreement as a template for professionally drafted legal documents. The Weil Gotshal law firm is a well known and Amlaw celebrated law firm that was named the top profit per partner of the year by the Amlaw publication. In celebration of this honor, RealDealDocs.com has decided to release this management agreement free of charge via the link at the bottom of this text.

Amlaw is both a website and magazine focused on legal businesses and lawyers around the world. It is a respected leader in daily news in the legal industry. Every year this respected publication publishes categorized lists of its picks of the best law firms. This annual Amlaw occurrence is the equivalent to the Academy Awards for lawyers! And RealDealDocs.com is happy to host and provide the work of many of Amlaw’s top picks.

All of the documents at RealDealDocs.com are drafted by top US law firms; including documents from Fortune 500 companies and small cap companies alike. From the National Law Journal‘s top 250 law firms, 40 of them use the RealDealDocs.com technology. And a majority of the law firms honored in the Amlaw review have their work on display and available at RealDealDocs.com.

Lawyers who use RealDealDocs.com, do so in order to lower the amount of time needed to draft a legal agreement. Even business professionals can use RealDealDocs.com in an effort to research a company or see how they handle various legal transactions.

Visitors at RealDealDocs.com can search nearly one million documents and 10 million clauses for free. As a member of RealDealDocs.com you can also edit, save and download these documents in a printer-friendly format for your own use.

RealDealDocs.com provides an enormous variety of contracts and agreements for companies in every industry from banking, clothing and marketable goods to the defense industry. And with over 10 million legal documents and clauses in addition to the THL Managers V LLC agreement, RealDealDocs.com has secured itself as an online leader in sample legal documents.

To view the THL Managers V LLC Management Agreement

To view other Management Agreements

Popularity: 5% [?]

It is no secret that the world of real estate legal wrangling can be pretty confusing, especially if you aren’t an experienced legal expert. Many different types of contracts only differ by a small amount, such as the difference between a real estate option contract and a right of first refusal contract. Let’s take a look at how these two types of contracts differ and how each are valuable tools when you want to make the real estate deal of a lifetime.

First, let’s look at a real estate option agreement. When you sign a real estate option, you are paying a seller for the right to buy a particular piece of property for a particular set price for a set period of time. Let’s say that you are looking at a home in a hot neighborhood and the price being asked for the home keeps going up because of a bidding war. You can ask to create a real estate option that will allow you to pay a certain price for that home for the next 3 weeks. After that three weeks has expired, you lose the right to buy that home for that set price. The seller is under no legal binding agreement to sell you the home for that price and the seller can continue to try to sell the home to other buyers.

Now, with a right of first refusal agreement, you have the legal right to refuse another person’s attempt to buy a piece of property. Many people confuse the two of these contracts and assume that the right of first refusal comes with an option contract. Unless you have the right of first refusal spelled out in your option contract, you have to assume that you do not have any way to stop another party from coming in and buying a piece of property that you want.

When you have a right of first refusal contact with a seller, you have the option to buy a piece of property for the same price as another buyer. Let’s say that same home that is in that hot neighborhood gets a bid of one million dollars. You then have the right to cancel out that bid and place a bid for the same amount and the seller would then sell the home to you, instead. If you decline your right of first refusal, than the seller has the legal right to sell the home to that person who made the bid.

A seller may enter into a right of first refusal with a buyer if they had a previous working relationship and the seller wishes to give a friend a chance to pay market price for a property. It is a smart way to avoid any accusations of impropriety when it comes to selling a valuable piece of land because the price the property ends up being sold at is determined by the free market, not by any sort of collusion.

Popularity: 7% [?]