As we see the increasing number of employees being asked or required to work from home and the cancellation of numerous events, we have been working with our clients to address how they manage the myriad of legal issues presented by these circumstances.

Beyond just advising our clients to read their contracts, we are specifically advising them with respect to these topics:

• Force majeure clauses: Those clauses with the funny name have taken on new significance. These provisions may provide relief when the failure to perform arises due to circumstances beyond your (or the other party’s) control. When reading these clauses, pay particular attention to any pre-conditions for invoking these clauses (e.g., does a state of emergency need to be declared) and to any technical requirements (e.g., is notice to the other party required; when are you required to recommence performance).
• Material Adverse Effect/Material Adverse Change clauses: These provisions are common in merger and acquisition agreements, but may also appear in other agreements. Whether there has been a MAE or MAC will depend on the specific definition of the term used in the agreement and any specific exceptions thereto (e.g., have general economic conditions, events affecting national securities markets generally, or force majeure events been carved out).
• Insurance requirements: Does the agreement require you, or the other party, to have insurance in place that may cover a disruption in performance? If so, what are the terms of the policies and who is an insured thereunder?
• Disaster recovery requirements: Does the agreement require the parties to have disaster recovery plans in place? You should review your own disaster recovery plan (if you haven’t done so already) and consider requesting a copy of the other party’s plan, if you do not have a copy. Implement those policies to the extent applicable to the circumstances.
• Non-contractual requirements: In addition to the terms of your agreements, there may be non-contractual requirements that impact how you adjust your operations for current events. Those non-contractual requirements may include: