Pre Partnership Agreement for Hong Kong

Pre Partnership Agreement Template for Hong Kong

A Pre Partnership Agreement under Hong Kong law is a preliminary legal document that establishes the framework and conditions for exploring and negotiating a potential partnership between two or more parties. This document outlines the terms and conditions that govern the pre-partnership phase, including confidentiality obligations, exclusivity arrangements, due diligence requirements, and conditions precedent to forming the final partnership. It provides legal protection and clarity for all parties during the exploratory phase while operating under Hong Kong's Partnership Ordinance (Cap. 38) and related legislation.

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What is a Pre Partnership Agreement?

The Pre Partnership Agreement serves as a crucial preliminary document for parties considering entering into a formal partnership arrangement under Hong Kong law. It is typically used when potential partners need to establish a structured framework for exploring their business relationship before committing to a full partnership. This document addresses key preliminary matters such as confidentiality, exclusivity, due diligence processes, and cost allocation during the exploratory phase. It provides protection for all parties while they evaluate the viability of the partnership and negotiate final terms. The agreement is particularly important in Hong Kong's dynamic business environment, where partnerships must comply with the Partnership Ordinance (Cap. 38) and related regulations. It helps prevent misunderstandings and provides a clear roadmap towards the potential formation of a formal partnership.

What sections should be included in a Pre Partnership Agreement?

1. Parties: Identification and details of all potential partners, including full legal names and addresses

2. Background: Context of the proposed partnership and the purpose of entering into this pre-partnership arrangement

3. Definitions: Definitions of key terms used throughout the agreement

4. Duration and Purpose: Timeline for the pre-partnership period and its intended objectives

5. Due Diligence: Framework for conducting due diligence investigations and information sharing

6. Confidentiality: Obligations regarding confidential information shared during the pre-partnership period

7. Exclusivity: Terms preventing parties from negotiating similar arrangements with others during this period

8. Proposed Partnership Structure: Outline of the intended partnership structure, roles, and responsibilities

9. Conditions Precedent: Conditions that must be satisfied before proceeding to formal partnership

10. Costs and Expenses: Allocation of costs during the pre-partnership period

11. Termination: Circumstances and process for terminating the pre-partnership agreement

12. Governing Law and Jurisdiction: Specification of Hong Kong law as governing law and jurisdiction details

13. General Provisions: Standard boilerplate clauses including notices, entire agreement, and amendments

What sections are optional to include in a Pre Partnership Agreement?

1. Initial Capital Contributions: Preliminary agreement on planned capital contributions - used when parties want to pre-agree financial commitments

2. Intellectual Property: Provisions regarding IP rights during pre-partnership period - important when IP is involved in business

3. Non-Competition: Restrictions on competitive activities - relevant when parties are competitors or in sensitive industries

4. Break Fee: Compensation payable if one party withdraws - useful for high-value or complex arrangements

5. Regulatory Approvals: Process for obtaining necessary regulatory approvals - needed for regulated industries

6. Employee Matters: Preliminary agreements on staff transfers or employment terms - relevant when existing businesses are involved

7. Tax Planning: Preliminary tax considerations and structure - important for complex or international arrangements

What schedules should be included in a Pre Partnership Agreement?

1. Schedule 1 - Due Diligence Requirements: Detailed list of required due diligence items and documentation

2. Schedule 2 - Timeline and Key Milestones: Detailed timeline for pre-partnership activities and target dates

3. Schedule 3 - Proposed Business Plan: Initial business plan and strategic objectives for the partnership

4. Schedule 4 - Required Consents and Approvals: List of necessary third-party consents and regulatory approvals

5. Schedule 5 - Proposed Partnership Agreement Terms: Key terms to be included in the final partnership agreement

6. Appendix A - Confidentiality Terms: Detailed confidentiality obligations and procedures

7. Appendix B - Due Diligence Questionnaire: Standard form questionnaire for information gathering

Authors

Alex Denne

Head of Growth (Open Source Law) @ Genie AI | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Jurisdiction

Hong Kong

Publisher

Genie AI

Document Type

Purchase Agreement

Cost

Free to use
Relevant legal definitions
Relevant Industries

Professional Services

Technology

Manufacturing

Retail

Real Estate

Financial Services

Healthcare

Construction

Consulting

Education

Hospitality

Media and Entertainment

Relevant Teams

Legal

Corporate Development

Finance

Business Development

Risk and Compliance

Strategy

Operations

Commercial

Executive Leadership

Company Secretarial

Relevant Roles

Chief Executive Officer

Managing Director

Business Development Manager

Legal Counsel

Chief Financial Officer

Partnership Manager

Commercial Director

Corporate Lawyer

Business Owner

Entrepreneur

Investment Manager

Operations Director

Risk Manager

Company Secretary

Industries
Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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