Starting a new business, especially starting a wine business, will involve proper contract development and negotiation of a wine agreement between a myriad of players in the wine industry. The nature of the wine industry, however, makes the type of business agreements used, different from other business agreements. Most wineries either crush grapes produced on their own vineyards, or they buy some portion of their grape from an outside grower, a supplier. In this last scenario, the vineyards must enter into Grape Purchase Agreements. These wine agreements vary in scope but the main points we deal with and negotiate are issues relating to control, quality, prince, and term.
Traditionally, grape growers are farmers who would rather tend to their land than deal with lawyers and contracts. As such, historically, agreements for grape purchases were handshake deals or standard contracts containing few details. However, these type of deals often lead to misunderstandings and deterioration of business relationships. Moreover, parties are more sophisticated and stakes are higher, resulting in complicated business structures, making detailed and thought-out wine agreements essential. Our Chicago corporate lawyers can help draft and negotiate your wine agreement.
The basic elements of the grape purchase agreement provisions are the term, pricing mechanisms, viticultural practices (including farming, picking and delivery), quality standards, and dispute resolution mechanisms. The standard terms governing assignment, force majeure clauses, and default also require special attention to detail, especially when structuring long-term contractual relationships in the wine industry historically characterized by regular changes in control and heavily influenced by weather patterns.