In our last RealDealDocs blog entry, we discussed promotion agreements, lease addendums, and stock transfer agreements. This week, we will cover three other types of agreements: strategic alliance agreements, extension agreements and release agreements.
To review, an agreement can be defined as “a negotiated and usually legally enforceable understanding between two or more legally competent parties. Although a binding contract can (and often does) result from an agreement, an agreement typically documents the give-and-take of a negotiated settlement and a contract specifies the minimum acceptable standard of performance.”
Strategic Alliance Agreement
A strategic alliance agreement is a contract between parties to follow a set of agreed upon goals needed to remain independent from each other. The agreement may be used to share products, gain higher manufacturing capability, access more project funding, as well as the access to more knowledge and expertise than one would have it they did not have a partner. While the partners have the same goal, unlike a joint venture, each company stays independent. A strategic alliance agreement has many advantages. Your business may be able to expand more quickly as you focus on the areas that best match your capabilities. You can also increase access to knowledge and resources you did not have before the agreement, which is beneficial if you have entered a new industry. Regardless of the company, every strategic alliance agreement should state the agreed upon goal for the company, the outline of working towards the company goals, as well as clearly stating the duties of each party. At times, there are strategic alliance agreements that are drafted for companies and their suppliers. These agreements are the same, stating what the supplier and company agree to in order to better their businesses.
An extension agreement is a contract between two parties to extend the term of their original agreement. The extension agreement provides documentation for any amendments or new terms to the original agreement. The agreement is used when your original contract needs to be protracted and any changes need to be made. The agreement is customizable for your company’s usage. Extension agreements are basic forms. They usually list the basics of the company, as well as listings for what amendments will be changed. While the agreements can be used to amend articles in the original agreement, it can also be used to prolong the contractual relationship between parties. Your Contract Extension Agreement should include details like the effective date of the extension agreement, names, addresses, and information about the parties involved, as well as the new end date of the extension. Some choose to attach the original extension agreement onto the revised agreement. Extension agreements are also used by lenders to roll back the due date of a loan, if they see that the borrower’s financial situation is improved.
A release agreement is a contract which releases on party from any liability or legal right to a situation, be it a job or a lawsuit. These are legally binding documents, and are often signed inside an attorney’s office or the courtroom. By using a release agreement, both parties can quickly and easily release themselves from the situation at hand. When a release agreement is used in conjunction with employment, it helps release the employer from having any further responsibility for the employee. This is useful, as it helps deter a lawsuit for wrongful termination, or a lawsuit alleging any other type of employment violation (OSHA or HIPPA violations, for example). The document is usually signed in return for a settlement from the employer. A release agreement can also be beneficial when it comes to lawsuit avoidance. For example, if someone enters your store and falls on a wet floor, you might have them sign a release agreement to prevent the customer from suing you for damages. This does not mean that the party at fault would get out without having consequences. In fact, when a release agreement is signed, the accusing party often gets some form of settlement. Knowing when to have a release agreement can help protect yourself, as well as your company, in times of turmoil.
Drafting an agreement from scratch can be a time consuming and daunting task – plus, without input from a qualified attorney, you may be poised to enter into an arrangement this not legally sound or in your best interest. Fortunately, RealDealDocs allows you access to thousands of agreements that have already been used in a myriad of different industries.