HI, we run a uniform & workwear shop. We are in negotiations with local school to buy and sell their uniform through our shop. The uniform is custom made and embroidered with school logo and our stock holding value could exceed $150k. A contract has been drawn up by the school. We do not agree to the Termination clause. As the uniform is custom made, we need to ensure they buy the uniform from us if the contract is terminated early for any reason. They will not agree to this. So I advised them, the sub clauses are quite vague and open to interpretation. I asked them to clarify the clause and to provide specific reasons why contract could be terminated and that the reasons should be considered very serious to warrant leaving us with their uniform that has no value to us but does to them. I don't agree that they can terminate contract if my employees commit a crime etc. as this is beyond my control and I would like clarification on what offences, ie can they terminate for a speeding fine or something trivial or non related to selling school uniform.
Should I be concerned or am I over thinking it? I feel they could make up any excuse to terminate contract and get them out of purchasing the uniform.
14.1 Any Party may terminate this agreement immediately by notice in writing at any time if:
14.1.1.
14.1.2.
14.1.3.
14.1.4.
14.1.5. the other Party or any of the other Party’s employees, contractors or sub-contractors undertaking the Services are charged with, reported for or found guilty of misconduct; or
14.1.6. the other Party or any of the other Party’s employees, contractors, sub-contractors or sub-contractors undertaking the Services are charged with, reported for or convicted of a criminal offence of a type which brings the Party’s reputation into disrepute and as a consequence the other Party reasonably believes that its continued engagement with the Party is prejudicial or detrimental to the reputation of the Party,
and where it is the School that terminates the agreement under this clause 14.1, no amount will be payable by the School to supplier on that termination despite the obligation that the School would otherwise have for purchase of items under clauses 2 or 15.
Should I be concerned or am I over thinking it? I feel they could make up any excuse to terminate contract and get them out of purchasing the uniform.
14.1 Any Party may terminate this agreement immediately by notice in writing at any time if:
14.1.1.
14.1.2.
14.1.3.
14.1.4.
14.1.5. the other Party or any of the other Party’s employees, contractors or sub-contractors undertaking the Services are charged with, reported for or found guilty of misconduct; or
14.1.6. the other Party or any of the other Party’s employees, contractors, sub-contractors or sub-contractors undertaking the Services are charged with, reported for or convicted of a criminal offence of a type which brings the Party’s reputation into disrepute and as a consequence the other Party reasonably believes that its continued engagement with the Party is prejudicial or detrimental to the reputation of the Party,
and where it is the School that terminates the agreement under this clause 14.1, no amount will be payable by the School to supplier on that termination despite the obligation that the School would otherwise have for purchase of items under clauses 2 or 15.