Binding and Non-Binding Terms Clause Samples
The "Binding and Non-Binding Terms" clause distinguishes which provisions of an agreement are legally enforceable and which are intended only as statements of intent or guidance. In practice, this clause will specify, for example, that confidentiality and exclusivity obligations are binding, while other sections, such as timelines or future intentions, are not legally enforceable. Its core function is to provide clarity for both parties, reducing the risk of disputes by clearly identifying which commitments must be honored and which are aspirational or subject to further negotiation.
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Binding and Non-Binding Terms. The terms of Sections 18.2, 18.3, 18.5, 18.6, 18.7, 18.8, 18.9, 18.10, 18.11, 18.12., 18.13, 18.15, 18.16, 18.18, 18.19 and 18.20 of this Agreement (the “Binding Provisions”) are binding upon and enforceable by the Parties. All other provisions of this Agreement other than the Binding Provisions (collectively, the “Non-Binding Provisions”) evidence a non-binding expression of the current intent of the Parties with respect to the Transaction. The Non-Binding Provisions of this Agreement shall become binding upon and enforceable by the Parties (and this Section 18.20 shall terminate and become void and have no effect) upon the approval on or before 11:59 p.m. Central Prevailing Time on May 21, 2010 (the “Outside Date”), by each of (i) the Board of Directors of PetroQuest Energy, Inc., and (ii) the Board of Directors of FPL Group, Inc., of the Transaction; provided, however, if such approval has not been granted on or before the Outside Date, this Agreement shall automatically terminate and become void and have no effect, without any liability on the part of either Party or its respective Affiliates or Representatives, except for the Binding Provisions, which shall survive such termination. Neither Party shall have any claim whatsoever against the other, any of its Affiliates, or any of their respective Representatives arising out of or relating to this Agreement or the Transaction contemplated hereby (whether sounding in contract, tort, or otherwise), except for any breach or threatened breach of the Binding Provisions or the Confidentiality Agreement. Nothing in this Agreement, no past or future action, course of conduct or failure to act relating to the Transaction may be relied upon by either Party as the basis for a contract by estoppel or otherwise, and WSGP expressly agrees, on behalf of itself and its Affiliates, that the execution by WSGP or any of its Affiliates of any commodities hedging transaction has not, is not, and will not be made, in reliance upon the consummation of the Transaction contemplated hereby.