I have been working on a contract management spreadsheet for a agri-business client of mine over the last month or so. I think this is a healthy exercise for all food and agri-businesses, no matter the size. It’s a nice way to understand who the company has contracts with, including Non-Disclosure/ Confidentiality Agreements with (potential) customers or employees/independent contractors. When going through this review, I recommend making an Excel spreadsheet with the following information:
– Effective Date;
– Renewal terms (e.g., automatically renews for 1 yr terms unless 60 days notice is given);
– Expiration date;
– Purpose and material terms of the contract;
– Confidentiality (e.g., silent, unilateral or bilateral) including term of confidentiality (e.g., 3 yrs after the termination of the agreement) and special conditions (e.g., must follow-up in writing within 30 days after oral disclosure of Confidential Information);
– Choice of law (if stated);
– Dispute resolution procedures (e.g., non-binding mediation with the New York State Agriculture Mediation Program then arbitration under the rules of the American Arbitration Association in Trenton, New Jersey);
– Procedures for termination of the contract (e.g., 60 days written notice to XYZ Address);
– Suggestions for how the contract can be approved upon renegotiation (e.g., ensuring the contract contains language stating that the parties are not in a joint venture or partnership); and,
– Hyperlink to the electronic file of the contract.
If drafted by an attorney, the document will be confidential and privileged (and should say so), not subject to discovery in litigation. When going through this exercise recently, a client learned that a key contract had recently expired. The parties then extended the current terms of the old contract. Without a valid contract, parties will be subject to the “default rules” under the state’s contract law. I believe this exercise is especially important if a food or agri-business has several Non-Disclosure Agreements, all with slightly differing terms. Once you have a nicely organized “Contract Spreadsheet” then it will be easy to make future updates.