How do you know TCPS really even owns or plans to acquire Zimbali?
LOS ANGELES, April 8, 2014 /PRNewswire/ -- TechnoConcepts, Inc. (OTCMarkets/Pinksheets: TCPS) is pleased to announce that it has signed a memorandum of terms to acquire Zimbali, Inc., a recently formed Nevada corporation, as well as the customer list of Zimbali Group, Inc., a Washington corporation, that is currently generating revenues.
A memorandum of agreement is not a legal document, and is not enforceable in court. In most cases, by calling a document a memorandum of agreement, the signers are showing that they don't intend to try to enforce its terms.
GRAY AREAS
Although these definitions seem reasonably clear, there are a number of situations where the picture gets murky. If a memorandum of agreement involves an exchange for a sum of money, for instance, it will nearly always be considered a contract under the law. In addition, there are two other legal conditions under which a memorandum of agreement, or no formal agreement at all, can be treated as a contract.
If one party takes a loss - in money, community standing, etc. - because the other agreed and then failed to do something, the first party may be able to sue .
Two organizations might sign a memorandum of agreement to collaborate on a program . One of them, on the basis of their agreement, spends grant money to set up the program, and then the other - without whose participation the program can't be run - backs out. The first organization may then be required to pay back the grant money, because it was spent on a program that never took place. In that case, even though there was no contract or exchange involved in the original agreement, the second organization might be forced by law to pay the first organization back...or it might not. It would depend on circumstances and the judge's opinion - that's why it's a gray area.
If a particular exchange has become customary, whether or not there's actually a contract covering it, a contract may be assumed to exist.
A participant has been cleaning the offices of a nonprofit health clinic every month for over a year, and getting paid a regular amount - let's say $100.00 each time - for doing so. Then, out of the blue, one month he cleans the office, and the clinic director refuses to pay, saying she didn't ask him to clean. Under the law, he could probably argue that the clinic had created a custom of paying him for this service, and that a contract was implied by this custom. If the judge agreed, the clinic would have to pay him the $100.00 for the cleaning he had already done. (They wouldn't have to continue with his services, but they'd have to let him know that they didn't want him to clean anymore.)
