An umbrella agreement can help business negotiators build stronger, more durable partnerships—but be aware of certain hazards when negotiating the terms of these deals.
Parties during mediation tend to want the best of both worlds. When reaching an agreement, they want to pin down parties’ respective rights and responsibilities, but they also want to retain the flexibility they need to deal with ever-changing business conditions. One solution to this apparent dilemma is to craft an umbrellaagreement.
An umbrella agreement sets out general principles that will apply to more specific give-and-take contracts in the future. More specifically, an umbrella agreement might include clauses that stipulate whether the parties will share industry knowledge with one another, how they will set prices, and whether they will engage in subcontracting and under what terms.
The skilled mediator will help the Parties to craft the umbrella agreement to fit their future goals and interests.