Exercise 1:
You are the general counsel of a sovereign wealth fund based out of the Middle East (the “Fund”). The Fund was
approached by a private equity sponsor based out of New York (the “PE Sponsor”) to possibly invest $200 million
in a transaction involving the acquisition of a company based in Texas (the “Target Company”) that is valued at
$1.5 billion.
Before giving the Fund any more information on the Target Company, the lawyers for the PE Sponsor sent the Fund
a draft nondisclosure agreement (“NDA”) to sign. The NDA is a one-way NDA that only protects information
disclosed by the PE Sponsor to the Fund.
Recently, the Fund has put in place an automatic data archiving and back-up software that automatically saves all
information received through emails or downloaded on the Fund’s computers to the Fund’s servers.
The NDA has the following provision:
“The Fund agrees that upon request by the PE Sponsor, the Fund shall promptly (and in any case
within  five  days  of  receiving  the  PE  Sponsor’s  request)  destroy  or  return  to  the  PE  Sponsor  the
Confidential Information and certify in writing to the PE Sponsor that all Confidential Information
has been returned or destroyed in compliance with this NDA.”
1. Revise this provision so that the Fund will not be in breach of the NDA because of this new software that it
has put in place. Explain how your changes help the Fund in one paragraph.
The Fund does not like newspapers publishing articles about its investments and is concerned that the PE Sponsor
may use the Fund’s name to garner publicity and more investors.
2. What provisions would you add to the NDA in order to protect the Fund? Explain how these new
provisions help the Fund in one paragraph. 

Exercise 2:
You represent Perfect Equipment Inc. (the “Buyer”), a manufacturer of industrial equipment based in Los Angeles,
California. The CEO of the Buyer is thinking about entering into a supply agreement with Simply Supply Inc.
(the  “Supplier”), a supplier of plastic molded parts based in Shanghai, China.
The Buyer’s CEO sent you the following email.
“Hey. As I mentioned when we last spoke, we are seriously considering using Simply Supply Inc.
out of China. One of our competitors uses them. I want to move quickly to sign up this supplier if
they are good. But I need to have my inspection team visit this supplier’s factory to make sure that
its factory is up to code and we can use its products. The inspection team tells me that they would
need at least two weeks to complete their inspection of this supplier after they get to China. As you
know, it costs a lot of money to fly a team of five inspectors to China and to pay for a two-week
stay. Before I send any of my employees to China, I think it makes sense to have this supplier sign
a letter of intent to agree business terms. Can you please draft a letter of intent for me to review?
When I send my employees over to China, I need to make sure that this supplier gives them full
access to inspect its factory and to ask questions of the managers who run its factory. If this supplier
checks  out,  we  will  purchase  three  tons  of  plastic  molded  parts  every  quarter.  We  have  agreed  a
price of $100,000 per ton of plastic molded parts supplied. After a shipment is received in our factory
in Los Angeles, this supplier would issue an invoice and we will pay it within 30 days.
I have negotiated and agreed with this supplier that we would be responsible for transportation but
this supplier has to get the goods onto the ship at its port. I think in Incoterms that is called CFR
Shanghai or FOB Los Angeles. I cannot remember the difference between these Incoterms. Can you
please tell me which one is the correct one and why? Thx.”
1. Draft the letter of intent for the Buyer. This draft should be one to two pages.
2. Answer the CEO’s question about Incoterms in one paragraph.
3. If you have recommendations for the CEO about adding any provision to the letter of intent, please provide
these recommendations and explain why you are making these recommendations in one to two paragraphs.
4. If you have questions for the CEO in order to finalize the letter of intent, please provide these questions in a
separate page.