Teaming Agreement Do's and Don'ts
Do
- Execute a Confidentiality/Nondisclosure agreement before exchanging any proprietary data and ensure that such agreement survives termination and/or expiration of teaming agreement
- Carefully define the scope of the information subject to the Confidentiality/Nondisclosure agreement to ensure that both written and orally communicated data is protected
- Carefully consider not only a potential teammate’s skills and resources, but also its performance history to ensure that you will not be caught off-guard by OCI, cost control, or poor past performance issues
- Consider the advantages and disadvantages of exclusivity and the need for “off ramps”
- Anticipate Government intervention in or interference with the relationship
- Clearly define the rights, roles, and responsibilities of each of the parties to the Agreement
- Clearly articulate the scope of the Agreement – one product line? one contract? an entire program? or a line of business?
- Include disputes provisions in the Agreement, defining procedure (arbitration or court proceeding), causes of action (contract and/or tort) and available remedies (indemnity, specific performance, injunctions, liquidated damages, limitations on damages)
- Include a termination provision, inclusive of termination for convenience if desired
Don’t
- Accept a so-called “standard” Teaming Agreement
- Ignore the “boilerplate” – e.g., choice of law, limitation of liability, key personnel clauses
- Narrowly define the information subject to the Confidentiality/Nondisclosure Agreement and ignore the need to protect your know how
- If you are the prime contractor, include provisions imposing an absolute duty to execute a subcontract
- Ignore the cost accounting and tax implications of the potential business structure of your teaming relationship
- Include provisions that may run afoul of the antitrust laws
- Ignore implications of affiliation rules when teaming with a small business to obtain access to small business set-asides
