Q: 1. MOU, LOI, term sheet – Is it possible to include a clause that requires the parties to observe a duty of good faith ?
How would they go about doing that? Would you recommend even including such a clause in the MOU/LOI/term sheet?
A: It is generally possible in many contracts. The decision could depend on how well the entire contract is drafted, and whether inclusion of the clause would be beneficial. Another factor to consider is the relationship with the other party to the contract. Under general contract law, good faith is generally implied to be something observed by the parties. Reviewing the contract with an attorney could help make the best decision in terms of inclusion or omission of such a clause in the contract and the related documents. Good luck
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