Florida Companies Governed by Delaware Law: Duty of Good Faith While Negotiating Term Sheets

This post is devoted to Florida companies that are negotiating term sheets, and that have elected to be governed by Delaware law – either at all times through company organizational documents or for a specific transaction using choice of law election provisions within a term sheet for a specific transaction.  

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What to Know About a “Pre-Contractual” Duty to Negotiate in Good Faith in Preliminary Agreements such as Term Sheets and Letters of Intent

As wonderful and as helpful as term sheets and LOIs can be as pre-contractual tools for efficiency, it is important to know whether your preliminary agreements could create legal obligations for you – based on the governing contract law.  Even though term sheets and letters of intent are usually non-binding in Florida (in the absence of a specific statement otherwise) another duty may still exist.

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LLC as a Holding Company

The limited liability company (“LLC”) has quickly become the favored business structure for many small businesses. This is due to its ability to combine many of the best features of both partnerships and corporations, such as operational flexibility, limited liability for all of its members, and pass-through taxation.A natural development that comes with this trend is the desire to continue reaping these same benefits and use an LLC as a holding company.

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