Sign an Agreement Prior to Negotiating
Domain sale negotiations can be a bit risky. I think two of the biggest potential pitfalls include 1) a prospective buyer using the negotiations in a UDRP or legal proceeding or 2) a buyer failing to follow through with an accepted offer.
I think a creative way that could reduce the risks is to have the prospective buyer sign an agreement prior to negotiating to buy a domain name. The agreement would list the terms and conditions of making an offer and discussing an acquisition. When you receive an offer to buy a domain name or an inquiry about a domain name, you can tell the prospective buyer that you require an agreement to be signed prior to negotiating the sale of a domain name.
I would obviously speak with an attorney to have an agreement such as this drafted, and some of the terms I would want to include in the agreement would be the following (along with my rationale):
- Offers are binding – If an offer is made and accepted by either party, the buyer must follow through with the purchase.
- Buyer must close within a set period of time using a set payment method – A prospective buyer could agree to a price but not be able to use reasonable payment terms. If the timing and payment method is known at the outset (7 day close via Escrow.com), this will prevent the other party from getting out of the deal.
- Disclaim trademarks – By doing this, the domain owner will significantly reduce risk of UDRP and/or cybersquatting lawsuit. If buyer signs agreement but still files a UDRP or lawsuit, I presume the domain owner would have his or her own legal case.
- Confidentiality – Whatever pricing is discussed by either party shall not be shared publicly. I wouldn’t want to give someone a great price on a domain name and have them write about it elsewhere.
- Non-disparagement clause – Negotiations get heated, and I don’t want the other party to write that I am a cybersquatter, scumbag, or other disparaging term.
Keep in mind that this is something I have not done, nor have I consulted with an attorney about whether an agreement like this is feasible. I think it might cause friction at the beginning of a negotiation, but if someone is serious about buying a domain name, they would likely sign the agreement. I think this could replace a disclaimer since this requires a signature from the prospective buyer and it would be binding.
I am curious about what you think of this idea.
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