1. Contracting: Designing an Agreement that Reflects Joint Interest and Expectations January 11, 2018
Katherine B. Ilten
Fredrikson & Byron, P.A.
(612)

2. What are lawyers good for?
Reading.
Writing.
That’s why lawyers are good at contracts.

3. When should I start to care about the contract?
Before you even see a draft.
Your contract should reflect the parties’ final decisions about the “deal”.
Unfortunately, the contract is often an afterthought, which can be problematic:
Program implementation hiccups
Disagreement about the deal
Disagreements about performance standards
Unrealistic expectations
No historical parties left to resolve

4. Main deal points Parties Services – who, what, when, where? Standards
Payment
Term
Termination options
Dispute resolution

5. Letter of intent Also called memorandum of understanding
Helpful for larger deals/arrangements
Non-binding
Include only the main deal points
“LOI creep”

6. Parties Know your entities! Can the contract be assigned?
Can the duties be subcontracted?

7. Services Know what hat you are wearing.
Does the agreement actually describe the services?
You can use exhibits, but don’t get sloppy.
Incorporate RFPs, SOWs, proposals, pitch materials

8. Services Are there deliverables?
Who is doing the services? Can they be replaced?
What is the timeline?
Location?
What do you need to perform the services (supplies, space, support, information) and who will provide it?

9. Standards
How will the services be performed? In accordance with what requirements and/or framework?
Licensing, accreditation, third party payer, government, internal organizational requirements
Related to evaluation. Consider timeline for evaluating services.

10. Payment Who pays who? How much? (Increase over term?) How? When?
Invoice required? Information to be submitted for payment?
What about disputed invoices?

11. Term Not just about length.
When does the work start? Effective date versus commencement date.
When does the work end—on a date or upon an event?
Initial terms and renewal terms.

12. Termination Material breach if no cure
Without cause (notice period length)?
Non-renewal
Immediately upon certain events?
Death, disability, termination of service provider?

13. Effect of termination, post termination
Penalties for early termination?
Remaining work
Confidentiality
Non-compete, non-solicit
Transition process

14. Dispute resolution Plain old termination notice
Take into account the type of agreement and the hat you are wearing when considering
Discussion process
Mediation
Arbitration
Injunctive relief

15. Other terms Recitals Duties of party receiving services Qualifications
Records
Audit rights
Compliance
Data/Confidentiality
Intellectual property

16. Other terms Indemnification Insurance Amendment Subcontracting
Assignment
Notice
Survival
Governing law

17. Myths heard in negotiations
“This is a standard template. It cannot be changed.”
Most contracts can be negotiated; some terms cannot.
“If we include that term for you, we would have to include it for everyone.”
“The law requires this language.”
“Only the lawyer can approve that.”

18. Myths heard in negotiations
“We don’t need to address that in the agreement. The contract language doesn’t really matter.”
“It’s the same as your current contract so you don’t need to review it.”
“I can talk to you without your lawyer being present.”
“It’s okay to change the contract based on our oral conversation.”

19. A word about exhibits Exhibits are part of the agreement
Sometimes they are an opportunity

20. A word about side letters
Also an opportunity
Helps to preserve the “template”

21. Terms that probably can’t be changed
Non-discrimination and Affirmative Action
Government Data Practices Act
EEOC
Business Associate Agreement provisions, if a BAA is required

22. Contracts you should really read before signing.
High dollar contracts
Contracts involving PHI
Third party billers
Contracts with vendor in heavily regulated area

23. Questions? Katie Ilten (612) 492-7428 kilten@fredlaw.com
This presentation does not constitute legal advice or create an attorney-client relationship with any member of the audience.