Our world is changing hour-by-hour and minute-by-minute amidst the Coronavirus pandemic. Are you struggling to figure out if you should cancel or postpone your fundraising event? Are you unsure of how to strategize with your corporate partners? Are you wondering how to work with instead of against your venue, sponsors and other partners?
In a recent webinar, Jeremy Coffey, Senior Associate at Perlman & Perlman, dove into some key considerations around legal contracts during this unprecedented crisis.
Jeremy discussed the core principles for managing chaos, a variety of legal issues related to this pandemic, different strategies for working with partners and altering agreements as well as key insurance considerations you may not have thought of.
While you can always access the webinar recording, here are three highlights from this superb webinar in an effort to help you navigate this tumultuous time at the intersection of profit and purpose.Access Recording Now! (Free to EFG Members or $99)
1). Be Flexible In The Face Of COVID-19
As our world evolves your plans, partnerships and programs will need to as well. Now is the time to be flexible and cooperative. Jeremy has been pleasantly surprised by how flexible partners are being with one another.
In order to forge ahead during this uncertain time, avoid ‘normalcy bias’ (believing that things will function in the future the way they normally have functioned in the past) and recognize the universality of the disruption we’re facing. Asses where you are and what your needs are before seeking to find creative solutions alongside your partners.
Key questions to ask yourself:
- What is your desired outcome for both existing and new contracts?
- Postpone, cancel, move ahead or amend
- What is the party on the other side going through?
- Mass cancellations, business disruptions (e.g. store closures, reduced customers), increased demand for charitable solutions
- What are our current challenges?
- Governmental directives, cancellations, increased costs
Then collaborate with your partners to find the best solution for all involved.
2). Understand Your Contracts And Strategize Postponements And Cancellations Earlier Rather Than Later
As Jeremy aptly pointed out in COVID-19: Navigating Legal Complications For Corporate Partnerships And Fundraising Events, venues are being flexible now but this may not last. Before approaching your venue, ensure you understand your contracts.
Do you have a Force Majeure clause (a contract clause that exempts one or both parties from performance when conditions make performance impractical or impossible)? Familiarize yourself with it.
- What is the threshold? “Impracticality” or “impossibility”?
- Is it one-sided or mutual?
- How is risk distributed?
If you don’t have a Force Majeure clause, look at your Cancelation or Termination clauses. Contract cancelation provisions are often one-sided and increase in penalties as the date approaches. Once you know what your legal rights are, touch base first with your legal counsel and then with your partners.
Work with partners to come up with creative solutions, rethink how to engage donors and customers digitally, communicate with stakeholders promptly and set policies with the information you have now (refunds, rollovers, etc.).
3). Five Things To Include In Future Contracts
There are a variety of conditions you may want to include in future contracts (or potentially even revisit to amend in current contracts). These include:
- Infectious disease wording in Force Majeure clauses
- A lower threshold – “impracticality” rather than “impossibility”
- The ability for either party to invoke Force Majeure, but be thoughtful of threshold
- A pause clause for your point of sale campaign
- A provision that if the venue is able to replace your event with one of equal or greater value, the cancelation fees are waived or refunded
Both parties will benefit from clarity and an even-handed contract. Treat your partners like true partners and come up with a win-win solution together.
Looking for more information? Jeremy dives into the above and much, much more in his recent webinar. Check out COVID-19: Navigating Legal Complications For Corporate Partnerships And Fundraising Events it’s free to members or $99. Become a member to receive this webinar and much more for free!Access Recording Now! (Free to EFG Members or $99)