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Glen Banks, a partner at Fulbright & Jaworski, writes that although courts have developed a framework to be applied to determine whether or not a preliminary document will be deemed to have a binding effect, the law is not as well delineated concerning how a court will determine what that binding effect will be. The lack of clear guidelines is illustrated by a recent Second Circuit decision where the court considered whether a "confidential letter agreement" that set forth the terms of a "presently contemplated" sale of stock constituted a binding agreement for the sale.
October 30, 2008 at 12:00 AM
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