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a standard contract preamble for agreement on published terms

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Published Terms Preamble

A standard contract preamble for agreement on published terms

WARNING

The Published Terms Preamble is highly experimental legal technology. It is not legal advice.

Do not use without the advice and approval of an attorney.

A what?

Start with a look at the included example.

For lawyers

The Preamble is the first stage in a two-step process of incorporation by reference.

In the first stage, an agreement defines specific terms to refer to the parties and deal-specific terms, like security price or length of contract term. The agreement then incorporates the Preamble by reference to a secure website URL, backed by a cryptographic fingerprint to prevent tampering.

In the second stage, the Preamble, now incorporated by reference, uses similar methods to incorporate the desired form agreement by reference. Terms defined for deal-specific terms in the body of the agreement are "passed through" to the form. The preamble also includes some rules of construction to prevent tampering with the published terms.

For systems programmers

Think of the Preamble as a kind of loader for form contracts. It brings terms written in a document published on the Internet into the context of a legal contract, with some integrity and authenticity checks for good measure. As a loader expects binaries of a certain format (e.g. ELF), the Preamble expects the published form to expose a defined term-based interface. As a loader copies command-line arguments to the stack, the Preamble passes defined terms through to the published terms.

For functional programmers

Think of the Preamble as a higher-order function that binds the terms of a public form contract to a specific legal context. The context includes the identity of the parties making the deal and any deal-specific points they need to plug into the form. The bound function is then "applied" by signing the agreement. (Fun fact: Lawyers call the act of signing "execution".)

For open-source programmers generally

The Preamble also works something like a source code package manager, pulling the terms of a published form contract into a contract for use between two parties.

For finance professionals

When trading, say, futures on an exchange, exchange rules provide the terms and context necessary to turn a simple confirmation or open-outcry order into a security with detailed, legally binding terms. In a private trading context, a master agreement, such as an ISDA Master Agreement between institutions, provides this context for short-form confirmations.

The Preamble allows a document as terse as a confirmation or electronic order, which states the terms of a specific deal, to create the same kind of context for itself, just for that deal. The preamble brings in the terms of a form agreement published on the Internet and uses defined terms to fill in the blanks.

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