When two businesses wish to collaborate to launch a project, they generally enter into a process that entails the mutual disclosure of confidential information. All parties share many of the same obligations during this preliminary phase. When launching such a project, it is important to clearly define the process in order to instil the confidence required to ensure the project's success.

This preliminary agreement to collaborate template sets out the legal framework for this preliminary step in a collaborative project. Note that this template is much broader in scope than our non-disclosure agreement templates (H01210 and H01220) and sets out terms that are similar to a letter of intent.

We recommend using this template to govern the preliminary discussions between two parties who wish to launch a project, but who also need to protect the confidentiality of information that will be disclosed. The absence of such an agreement increases the risk of a dispute arising, as a result of ambiguities concerning the parties' obligations with regard to the project.

0.00 INTERPRETATION
0.01 Definitions
0.01.01 Agreement
0.01.02 Breach
0.01.03 Claim
0.01.04 Confidential Information
0.01.05 Dispute
0.01.06 Evaluation / Evaluate
0.01.07 Force Majeure
0.01.08 Intellectual Property
0.01.09 Law
0.01.10 Legal Representatives
0.01.11 Loss
0.01.12 PARTY
0.01.13 Person
0.01.14 Project
0.02 Entire Agreement
0.03 Applicable Law
0.04 Non-Compliance
0.04.01 Severability
0.04.02 Substitute Provision
0.05 Miscellaneous
0.05.01 Cumulative Rights
0.05.02 No Waiver
0.05.03 Time and Days
a) Time of the Essence
b) Computation of Time
c) Delays
0.05.04 Cross-References
0.05.05 Gender and Number
0.05.06 Headings
0.05.07 Approval
1.00 PURPOSE
1.01 Evaluating Project
1.02 No Obligation
1.03 Conditions
1.03.01 Required by PARTY A
1.03.02 Required by PARTY B
1.03.03 Election
2.00 CONSIDERATION
3.00 TERMS OF PAYMENT
4.00 SECURITY
5.00 MUTUAL REPRESENTATIONS AND WARRANTIES
5.01 Status
5.02 Authority
5.03 Binding Agreement
5.04 Resident in Canada
5.05 Insurance
5.06 Nominee
5.07 Independent Legal Advice
5.08 Disclosure
5.09 Legal Proceedings
5.10 Exclusivity
5.11 Expertise
5.12 Intellectual Property
6.00 REPRESENTATIONS AND WARRANTIES OF PARTY A
7.00 REPRESENTATIONS AND WARRANTIES OF PARTY B
8.00 MUTUAL DUTIES AND OBLIGATIONS
8.01 Confidential Information
8.01.01 Undertaking
8.01.02 Duration of Undertaking
8.01.03 End of Agreement
a) Request for Return
b) Destruction
8.01.04 Penalty
8.02 Continuation of Representations and Warranties
8.03 Indemnification
8.03.01 Scope
8.03.02 Procedure
8.03.03 Third-Party Claim
8.03.04 Duration of Representations and Warranties
8.04 Disclosure of Agreement
8.04.01 Undertaking
8.04.02 Public Announcement
8.04.03 Exception
8.04.04 Default
8.05 Periodic Meetings
8.06 Further Assurances
8.07 Non-Competition
8.07.01 Undertaking
a) Definition
b) Scope
8.07.02 Breach of Undertaking
a) Automatic Penalty
b) Payment
c) Protective Measures
8.07.03 Reasonableness of Clause
8.08 Non-Solicitation of Clients
8.08.01 Undertaking
a) Definitions
b) Scope
8.08.02 Breach of Undertaking
a) Automatic Penalty
b) Payment
c) Protective Measures
8.09 Intellectual Property
8.10 Exclusivity
8.11 Evaluation Timeline
8.12 Liability
8.13 Duty to Keep Informed
8.14 Due Diligence
9.00 DUTIES AND OBLIGATIONS OF PARTY A
10.00 DUTIES AND OBLIGATIONS OF PARTY B
11.00 SPECIAL PROVISIONS
11.01 Assignment
11.01.01 Prohibition
11.01.02 Effect of Breach
11.01.03 Exception
11.02 Force Majeure
11.02.01 Limitation on Liability
11.02.02 Duty
11.02.03 Right of Other PARTY
11.03 Relationship Between the PARTIES
12.00 GENERAL PROVISIONS
12.01 Notices
12.02 Dispute Resolution
12.02.01 Good Faith Negotiations
a) Written Notice
b) Meeting
c) Legal Proceedings
d) Protective Measures
12.02.02 Mediation
a) Process
b) Settlement
c) Arbitration [OR Legal Proceeding]
12.02.03 Arbitration Procedure (if V1 of 12.02.02 c) applies)
a) Notice
b) Reply
c) Appointment of a Third Arbitrator
d) Confidentiality
e) Hearing
f) Ruling
g) Costs
h) Supplementary Rules
12.03 Choice of Forum
12.04 Counterparts
12.05 Amendment
12.06 No Waiver of Rights
12.07 Electronic Transmission and Signature
12.08 Language
13.00 TERMINATION
13.01 Expiry of Term
13.02 Automatic or by Mutual Consent
13.03 No Default
13.04 Event of Default
13.04.01 Without Notice
13.04.02 With Prior Notice
14.00 EFFECTIVE DATE
15.00 DURATION
15.01 Initial Term
15.02 Survival
16.00 SCOPE

SCHEDULE A – EXCERPT OF A RESOLUTION OF PARTY A
SCHEDULE B – EXCERPT FROM A RESOLUTION OF PARTY B
SCHEDULE 8.07.01 – NON-COMPETITION - TERRITORY
SCHEDULE 8.09.01 – NON-SOLICITATION - LIST OF CLIENTS
SCHEDULE 8.12 – EVALUATION TIMELINE