Pre Agreement Contract Template for Hong Kong

The Pre Agreement Contract is a essential tool in Hong Kong's commercial landscape, particularly useful in complex business transactions where parties need to formalize their intention to negotiate while protecting confidential information exchanged during discussions. This document type is commonly used when parties have agreed in principle to pursue a transaction but need time for due diligence, detailed negotiations, or regulatory approvals. It typically includes both binding elements (such as confidentiality and exclusivity provisions) and non-binding elements (such as the proposed commercial terms), reflecting Hong Kong's sophisticated business environment and its common law legal system. The document serves as a bridge between initial discussions and a final agreement, providing structure to negotiations while maintaining flexibility for the parties involved.

1. Parties: Identification of all parties involved in the potential transaction or relationship, including full legal names and registered addresses

2. Background: Context of the proposed transaction or relationship, including the purpose of entering into preliminary discussions

3. Definitions: Key terms used throughout the document, particularly defining 'Confidential Information' and 'Proposed Transaction'

4. Purpose and Scope: Clear statement of the intended purpose of the pre-agreement and its scope, including what is being explored or negotiated

5. Non-Binding Provisions: Express statement of which provisions are non-binding, typically including the main commercial terms under discussion

6. Binding Provisions: Clear identification of which provisions are binding (typically confidentiality, costs, and governing law)

7. Confidentiality: Obligations regarding the protection and non-disclosure of confidential information exchanged during negotiations

8. Duration and Termination: Period for which the pre-agreement remains in effect and circumstances for termination

9. Costs and Expenses: Statement of how costs associated with negotiations and due diligence will be borne

10. Governing Law and Jurisdiction: Specification of Hong Kong law as governing law and Hong Kong courts' jurisdiction

11. Execution: Signature blocks for authorized representatives of all parties