There are certain things you should consider when reviewing or drafting a commercial contract. A commercial agreement usually addresses pricing and payment, representation and warranties, limitations on liability, etc. However, whenever a counsel makes a draft of the commercial contract or reviews it, he should first consult the specific law for his state and industry.
What Are The Things Or Terms You Have To Include While Drafting A Commercial Contract?
The terms that you should include in the contract are as follows.
All the key business provisions of the agreement must be drafted or reviewed and based on the nature of the deal. You have to include material terms. Pricing and payment information, services that will be provided or goods sold, ordering procedures, return and refund information, shipment terms are some of these terms to mention.
You also have to include the other standard terms and conditions like indemnifications, insurance, limitations on liability, representations and warranties, ownership and licensing rights, dispute resolution terms, audit and inspection rights, no assignment, etc.
Here you need to mention terms like ordering and return procedures, territory, shipment and delivery times, minimum guarantee information, delivery and deadline information, and key personnel. You also have to include warranty information and terms related to review rejection and approval.
What Do You Need To Do While Drafting A Commercial Contract?
Not only including these critical terms, but you also have to perform the following duties. A qualified commercial contract lawyer may help you with this.
You Have To Meet With Business Executives
You Have To Set Up The Pricing And Payment Terms
First, you have to consider the transaction type when you will determine the pricing. Here, you have to select a pricing structure that may be fixed or formula-based, like based on time or materials. You should also take the pricing subject and the refund rights provision into account and choose the due dates for payments that can be set at particular dates according to events like ‘completion of all services.’
You Have To Set Up And Make A Review Of Representations And Warranties
Here, you need to incorporate different representations and warranties to give space to losses. These representations and warranties include valid existences of both the parties, their right and ability to carry out business contemplation according to the agreement, and their legal rights to enter into the contract and perform the terms without going against any laws or agreements.
Set Up And Review The Indemnifications To Allocate The Risks
You have to choose which types of liabilities you should cover and which you should exclude.
You May Think Of Including A Limitation On The Liability Clause
Other performing duties include reviewing insurance obligations, agreement terms and termination provisions, ownership and licensing rights, audit and inspection rights, and protecting confidential information. For necessary help, it is practical to look for commercial contract lawyers in Perth. Firms like Commercial Lawyers Perth WA can help you find the best commercial lawyers.
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