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Christina M. Lyons is a partner in the Corporate & Securities section at Jackson Walker. Her practice is broad and includes counseling both profit and nonprofit entities in matters involving business formation, entity selection, corporate governance, director and officer liability, and fiduciary duties. Ms. Lyons regularly assists clients in the structuring and negotiation of joint ventures, mergers, and stock and asset acquisitions on both the

sale and buy side. Ms. Lyons also has experience in private placement of securities and contract negotiation. Her clients are engaged in various industries, including health care, restaurant services and manufacturing and distribution.

Ms. Lyons is also a registered nurse and has worked at one of Ohio's largest hospitals in its cardiac and level 1 trauma intensive care units.

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Jeri Wechsler is a co-founder and General Counsel of ZeoGas LLC, a development-stage energy company building a portfolio of manufacturing plants converting natural gas into liquid fuels. Ms. Wechsler has contributed to ZeoGas’ development beginning with a mid-2012 advisory role and continuing since she joined ZeoGas full time in January 2013 as General Counsel. Ms. Wechsler negotiated the company’s technology licenses, collaboration agreements, and other contracts, and has participated in all business and legal aspects of the company’s early stage development. She holds a Master of Laws (LL.M.) in Energy, Environment and Natural Resources and leads the company’s environmental permitting and compliance efforts.

Before joining ZeoGas, Ms. Wechsler served as general counsel, acting general counsel, and chief environmental and litigation counsel to two of the largest privately held organizations in the U.S., operating in the chemical manufacturing, oil and gas E & P, wholesale, retail, manufacturing, and financial services industries, each employing approximately 10,000 employees during her tenure. She has provided legal advice and counsel to management teams, boards of directors, and owners. Ms. Wechsler has managed complex governance matters, participated in the legal affairs committees of national industry organizations, led joint defense groups in personal injury class action cases, developed and implemented numerous processes and procedures for environmental, FCPA and other compliance and training programs and managed complex intellectual property portfolios. She has assisted in developing and launching several private label consumer products and provided legal and compliance support to a variety of corporate subsidiaries, including a chain of 80 retail grocery and liquor stores, an employee credit union and an on-campus medical clinic.

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PART 1

BUSINESS COLLEAGUES: “WE HAVE A DEAL”

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What does this mean?

Do the parties already have an agreement?

Is it in writing or only a “handshake”?

Is there a history or course of dealing?

• Is there a Term Sheet or Letter of Intent?

• Are all of the major business points resolved? (Has anyone told you what they are?)

• Are the actual parties to the deal known?

What is the deal and which side am I on?

Dictates approach and negotiation leverage.

Who is asking you for the contract? Who is your client? Who is the counterparty? What is the subject matter?

• Competition Issues?• Compliance Issues?• Reporting Issues?

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How do we get to the finish line?

Are there timing issues? Are there known deal breakers?

• Legal?

• Business?

• Logistical?

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PART 2

BUSINESS COLLEAGUES: “WE NEED TO ‘PAPER IT

UP’!”

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Time for team communication Which side will prepare the first

draft? What are the considerations for

deciding who starts the drafting? In-house? Outside counsel? Counterparty?

Who is the main drafting contact for the client?

Business Person Executive Officer General Counsel

Are there confidentiality issues? Internally - safeguards Externally - competitor

What are the client’s policies and standards?

Internal approval requirements Delegation of authority Standard terms and conditions

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PART 3

LAWYER TO BUSINESS COLLEAGUE: “YOU AGREED

TO WHAT???”

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Get to know the deal fromyour client’s perspective Is this transaction similar to others

in the past? Is this an industry standard

transaction? Is there a relationship with the

counterparty? How important is this transaction

for the client? When must the contract be

signed? Are there key issues to be

considered?

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Do you need to unwind/avoid a bad agreement?

Did your client agree to an illegal act?

Did your client agree to something that violates a company policy?

Will this agreement cause you to breach another contractual obligation?

Does the agreement implicate any reporting or other legal requirement?

THOUGHTS FROM THE AUDIENCE?

PART 4

LAWYER TO SELF: “WHERE DO I START--STANDARDIZED

CONTRACT/BOILERPLATE OR BRAND NEW CONTRACT?”

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Does the client have style or drafting preferences?

What are the key factors? Cost Time to complete contract Length of contract term Nature of agreement

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Inside Lawyer to Outside Lawyer: “Standardized Contract/Boilerplate Advantages”

“Industry standard” Cost effective Efficient One-sided to benefit of drafter Previous review of critical thinking

provisions Adheres to policies Doesn’t reinvent the wheel

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Outside Lawyer to Inside Lawyer: “Standardized Contract/Boilerplate Disadvantages”

May carry-over disadvantageous or outdated provisions

May not include deal specific terms May waive important rights

Arbitration Jury waiver

May deter detailed review of the fine print

Forum selection Choice of law

Thoughts

from the Audience

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Outside Lawyer to Inside Lawyer: “New Contract Advantages” Assures up-to-date provisions

(employment, tax, indemnity, environmental)

Focused work product that captures all necessary provisions

Removes provisions that were deal-specific on a previous transaction

There is no need to rehabilitate the contract

Can be a teaching opportunity

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May require more time May be too expensive May create confusion May not include necessary but

unusual industry or client-specific provisions

Critical provisions have not been vetted

Tax Employment Environmental

Inside Lawyer to Outside Lawyer: “New Contract Disadvantages”

Thoughts

from the Audience

PART 5

BUSINESS COLLEAGUE TO LAWYER: “CAN’T WE JUST SIGN IT AND BE DONE ALREADY? WE

ARE FRIENDS, WHAT COULD HAPPEN?”

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Contract Negotiation

Does the client prefer to take the lead on working group calls?

Make sure the business staff and counsel are on the same page

Don’t be afraid to ask for what you want Adequate due diligence – don’t be hasty Know your role and your client’s perspective

Client – get the deal done and don’t get us sued

Outside counsel – do not harp on legalities if they are unlikely to become a reality

Do not be aggressive on every point

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Tips for easing negotiating process:

Have lawyer-to-lawyer discussions to resolve purely legal issues prior to meeting

Discuss the contract in detail with your business colleagues before meeting with counterparty

Resolve internal disagreements before meeting with counterparty or agree how to handle in the meeting

Understand the most important issues and identify your “throw-down” issues

Start with a reasonable draft—you’ll always get to the middle anyway

Agree with counterparty on approach at the outset: Provision by provision start to end Knock out the easy issues first Finish up hard stuff then go to easy stuff

Thoughts

from the Audience

PART 6

“HOUSTON, WE HAVE A PROBLEM.”

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Why is bad drafting a problem?

Poorly drafted contract creates ambiguity and will result in extra legal costs

Confusing or conflicting language slows negotiation Poor drafting unnecessarily creates legal issues,

opportunity for business mischief through unintended “interpretation” and interferes with business operations.

More likely to result in a dispute between the parties than a well drafted, easily understood document

Distracts from business Can lead to unexpected consequences Requires resolution Disruption could result in competitive disadvantage

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Back to Square One - Drafting Basics

Always use an attorney – whether in-house or outside counsel

Whose responsibility to draft - Everyone’s Contract drafting is a fluid process Specific controls over the general Keep subjects and verbs together Put main clauses early

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When the juice may not be worth the squeeze:

Representations and warranties Indemnification Choice of law Jurisdiction

Concentrate on key provisions

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Common drafting mistakes to avoid and watch for:

Relying on spellcheck or auto-correct From versus form Tis versus this

Defined Terms Capitalized terms with more than one definition Undefined material terms

Avoid Redundancies Indemnify and hold harmless True and correct sell, transfer and convey

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Easy ways to improve any contract:

Lose the archaic terms “Witnesseth” “Now, therefore” “Whereas” “Good and valuable consideration” –

unnecessary in modern commercial contracts

“ Upon” - should be limited to fairy tales

1. Use relevant language

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Use active voice Avoid unnecessary

person/gender references Avoid run-on sentences Limit unnecessary obligations

do not overuse “shall”

2. Use best writing practices

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Different documents for the same transaction should have the same miscellaneous provisions

If possible, keep definitions uniform

3. Review and coordinate all Ancillary Documents

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Start from the end of the document

Check numbering, and paragraph/ section/subsection references

Check all names for correct spelling and references (his/her)

Confirm signature blocks

4. Always Proof your Document

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Suggested Legal Writing Resources1

http://www.acc.com/legalresources/index.cfm Brian Garner’s seminars – www.lawprose.org Ken Adams - www.adamsdrafting.com

“A Manual of Style for Contract Drafting” (ABA 2d ed. 2008)

_____________1. No endorsement or affiliation, only suggestions based on personal experience

Christina LyonsJackson Walker L.L.P.1401 McKinney, Suite 1900Houston, Texas 77010Tel. 713.752.4450www.jw.comclyons@jw.com

Jeri WechslerZeoGas LLC10260 Westheimer, Suite 240 Houston, TX 77042 Tel. 713.751.9138www.zeogas.comjwechsler@zeogas.com