Get Your Contracts Reviewed

By Experienced Cannabis Attorneys

The Importance Of Contract Review In The Cannabis Industry

The cannabis industry is known for handshake agreements, which can lead to many problems when the parties have different understandings of what was agreed upon or when events don’t play out as expected. However, a poorly drafted agreement can be nearly as bad because parties will interpret it differently and key terms will be left out, making any attempt at dispute resolution expensive and time-consuming.

Having an attorney well-versed in cannabis-related issues review your contract can avoid future misunderstandings. It also ensures the contract is compliant with regulatory requirements and is otherwise enforceable.

Some Key Components Of A Cannabis Contract

Conditional rights and obligations

This is especially important in real estate transactions where sites need to be approved at the state and local level.

Flexible amendment clauses

Many contracts must be disclosed to regulatory agencies, which can require the parties to amend the contract. Similarly, cannabis laws and regulations change rapidly and in unexpected ways, which can require the parties to build flexibility into their contracts.

Enforceability clauses

You must prevent an unscrupulous counterparty from trying to get out of the contract because it concerns federally illegal subject matter.

Tax indemnification clauses

Taxes surrounding the operation of cannabis businesses are complicated and it can raise novel legal issues. The risks must be properly allocated between the parties.

Why Choose Rattner Law For Contract Review?

Our process centers on your best interests at every turn. At Rattner Law, we start by asking our clients what they are trying to achieve, both in the specific contract and big picture. Using that feedback, we analyze the contract and tailor it to your business’ needs. If we believe a contract does not comply with regulatory requirements, we will suggest ways to bring that contract into compliance with minimal disruption to the underlying business goals and economic benefits. Throughout the process, our communication will be candid and it will distill complex regulations into easier-to-understand real world terms so that you can make the best decision for your business.

All Practice Areas By Rattner Law

Well-drafted contracts are critical for the long-term success of a business. Our experience with complicated regulatory matters guides our contract review and drafting. Through rigorous analysis and extensive experience, we have seen what may result in litigation. In fact, our comprehensive suite of legal services, listed below, all contribute to drafting strong contracts for your business.

These services include:

Entity selection and formation
Corporate governance documentation (i.e., operating agreements, shareholder agreements, etc.)
Corporate governance advice
Cannabis license applications
Regulatory compliance and advice
Deal structuring
Mergers, acquisitions, and exits
Real estate transactions
Advocacy work before municipalities and community boards
Fractional outside general counsel
Labor and employment
Intellectual property licensing
Intellectual property litigation
Business and commercial litigation
Partnership disputes
Mediation
Arbitration
Article 78 litigation

FAQs About About Cannabis Contracts

What types of contracts are used in the cannabis industry?

Frequently used contract types include:

Management services agreements
Co-manufacturing agreements
Intellectual property licensing agreements
Crop purchase agreements
Employment agreements
Convertible promissory notes

These are just a few examples. There are are many, many other cannabis contracts.

In addition, parties often require contracts customized to the particular transaction they are entering into. We draft these customized agreements, too.

Why should I use a lawyer if ChatGPT can write and review my contract?

ChatGPT and other AI tools are very good at summarizing basic legal concepts and identifying some types of issues. Where they fall short, though, is in the specialized knowledge of regulations relating to cannabis, and the details that will matter if there’s ever a dispute. Thus, AI models generally do not have the ability to spot and solve all the issues that an experienced cannabis attorney will. They do not have the experience and judgment to provide counsel about how a problem or dispute is likely to play out in real life.

Additionally, we can frequently identify when a contract has been drafted with AI because of inconsistent definitions and word usage, ambiguous or contradictory language, and other issues that make the contract subject to differing interpretations and disputes.

Contact Rattner Law

445 Hamilton Ave. Suite 1102, White Plains, NY 10601
Hours: 9:00 a.m.-5:00 p.m. EST
info@rattner-law.com
(914) 220-5468

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