What Does Side Agreements Mean

Side agreements – An important concept in business negotiations

In the world of business, contracts and agreements are an essential part of any transaction. They help to establish the terms and conditions of the deal and provide a legal framework for the parties involved. However, there is another type of agreement that is often used in business negotiations, known as a side agreement. In this article, we will explore what side agreements mean and why they are important in business negotiations.

What are side agreements?

A side agreement is a separate agreement that is negotiated and agreed upon by the parties involved in a transaction, in addition to the main contract. It is usually a private agreement that is not included in the main contract, but is legally binding and enforceable. Side agreements can take many forms, from a simple letter of understanding to a more complex document that outlines specific terms and conditions.

Why are side agreements important?

Side agreements are often used in business negotiations when there are issues that cannot be resolved through the main contract. For example, if there is a disagreement over the price of a product or service, a side agreement can be used to address the issue and provide a solution that is acceptable to both parties.

Side agreements can also be used to address other issues that may not be covered in the main contract, such as intellectual property rights, confidentiality agreements, and non-compete clauses. By including these provisions in a side agreement, the parties can ensure that their interests are protected and that the transaction is conducted in a fair and equitable manner.

Finally, side agreements can be used to build stronger relationships between the parties involved in a transaction. By addressing specific issues and concerns, the parties can demonstrate their commitment to each other and build trust and confidence in the business relationship.


Side agreements are an important concept in business negotiations. They provide a way to address issues that cannot be resolved through the main contract, protect the interests of the parties involved, and build stronger relationships between the parties. As a professional, it is important to understand the significance of side agreements in business negotiations, and to ensure that they are accurately and clearly presented in any related documents.

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