A Partnership Agreement defines the rights, duties, and profit-sharing arrangements among business partners. This playbook explores governance, capital contributions, and dispute resolution.
Why This Matters: Well-defined representations prevent post-closing disputes and establish clear risk allocation for potential liabilities.
Negotiation strategy
If you're the Buyer:
Ensure all representations are backed by thorough due diligence. Insist on detailed disclosure schedules to mitigate risks.
If you're the Seller:
Limit the scope of representations to avoid overcommitment. Negotiate shorter survival periods to minimize long-term liability.
Essential elements
1
Organization and Authority
Entity's legal standing and power.
2
Authorization and Enforceability
Agreement's validity and binding nature.
3
No Conflicts
No legal or contractual breaches.
Action framework
ACCEPT
Propose edits if due diligence reveals inconsistencies or if jurisdictional adjustments are needed.
EDIT
Reject if representations are overly broad or unsupported by evidence.
ADD
Add language for specific risks identified during due diligence.
PRO TIP
Always cross-check representations with due diligence findings to ensure accuracy and completeness.
Example clauses
FAVORABLE
Preferred Representations and Warranties
"Each party represents and warrants to the other party that: [Organization and Authority, Authorization and Enforceability, No Conflicts, Compliance with Laws, Litigation]"
NEUTRAL
Disclosure Schedules
"The representations and warranties of each party are subject to the disclosures set forth in the disclosure schedules delivered by each party to the other party concurrently with the execution of this Agreement."
UNFAVORABLE
Survival of Representations and Warranties
"The representations and warranties of the parties contained in this Agreement shall survive the Closing for a period of twelve (12) months."
Fallbacks
High-Risk Projects
In high-risk projects, representations should be more comprehensive, covering additional areas like environmental compliance and cybersecurity.
Cross-Border Transactions
For cross-border deals, ensure representations address international compliance and currency exchange regulations.
Start-Up Acquisitions
In start-up acquisitions, focus on intellectual property representations and the continuity of key personnel.
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WEEK 1
CLM Readiness and Design
Our CX team works with you to understand your contracting challenges, prioritize key workflows, and identify the biggest impact areas. We build a tailored implementation plan that fits your needs.
WEEK 2
Install Module
We connect DocJuris to your contract repositories, set up admin and user accounts, and ensure your environment is ready for success.
WEEK 3
Deliver & Test
Your team builds initial playbooks, reviews existing clause libraries, and trains the DocJuris agent to align with your internal standards and negotiation positions.
WEEK 4
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