What Legal Contracts Does My Medical Marijuana Dispensary Need?

Question:  What are the various types of contracts needed by all Arizona medical marijuana dispensaries?

Answer:  The following is a list of the contracts that all Arizona medical marijuana dispensaries need.  Because of the unique nature of the business and the risk that an improper action by an employee, independent contract or dispensary agent could cause the loss of a dispensary’s license, it is critically important that the dispensary have very tight contracts that protect the dispensary.  Each contract must be drafted by an attorney who is familiar with and takes into consideration the legal requirements imposed on dispensaries by Arizona’s medical marijuana law and the Arizona Department of Health Services’ rules.  Each dispensary needs:

1. Lease for the dispensary site
2. Lease for the cultivation site
3. Application for Employment
4. Employment Agreement
5. Contract with the primary medical director (see “Clauses to Include in a Contract between a Medical Director & a Dispensary)
6. Contract with the alternate medical director (see “Why Every Arizona Medical Marijuana Dispensary Must Hire a Primary & an Alternate Medical Director“)
7. Contract with Marijuana Grower Personnel
8. Authorization to Conduct Background Check
9. Dispensary Agent Agreement
10. Employee & Dispensary Agent MMD Law Knowledge Test
11. Employee Policy Manual
12. Nondisclosure & Confidentiality Agreement
13. Independent Contractor Agreement
14. Premises Security Agreement for security guards
15. Information Technology Agreement for computer services
16. Patient Registration Form
17. Patient Disclosure Form with Receipt
18. Retail Sales Contract Form with disclosures
19. Contract to Purchase Marijuana from another Dispensary
20. Contract to Sell Marijuana to another Dispensary
21. Marijuana Delivery Contract for anybody who delivers marijuana
22. Buy-sell Agreement for the Owners of the Dispensary (the exit strategy)

Jeana Morrissey(602-906-4953, ext. 4) and I (Richard Keyt – 602-906-4953, ext. 1) are Arizona business lawyers who are now Arizona medical marijuana attorneys.  I’ve practiced business law in Arizona since 1980 and prepared thousands of business contracts.

We can prepare individual contracts for your needs, but we recommend you purchase our bundle of all legal documents for $10,000 ($500/doc).  The bundle includes any updates we make for one year after purchase and all of the above listed Arizona specific medical marijuana dispensary contracts except the buy-sell agreement.  The bundle also includes any new medical marijuana dispensary legal contracts that we create in addition to those listed above.  We give you the documents in Word 2007 format so you can customize them for you specific needs and use them over and over.

The Buy-Sell Agreement

The buy-sell agreement is not included in the bundle because it is a unique document that must be customized for each company.   We need to meet with or get input from the owners as to  the provisions that work for them.  Each ownership group is different so we modify the buy-sell agreement after getting input from the owners.

For companies that have multiple unrelated owners, a good buy-sell agreement is a must have document because without it there is no easy way to effect a company divorce when one or more owners want to part ways or need to part ways.  For more about this important document read my articles called “Why Every Arizona Medical Marijuana Dispensary Must Have a Buy Sell Agreement” and “Why Multi-Member LLCs Must Adopt an Operating Agreement with Buy-Sell Provisions.”  This article discusses a buy-sell agreement that is part of a vanilla LLC Operating Agreement.  For medical marijuana dispensaries, I prepare a stand alone buy-sell agreement because of the unique issues of this type of business.  If we form your nonprofit LLC the buy-sell agreement is included for no additional charge.  If we do not form your LLC or corporation, the Buy Sell Agreement is $1,500.  The buy-sell agreement comes with one hour of attorney time to discuss changes with the owners and to modify the document.  Additional attorney time is billed at the rate of $295 per hour.

KEYTLaw attorney Jeana Morrissey prepares buy-sell agreements for medical marijuana dispensaries.  If you have questions about buy-sell agreements or want to hire us to prepare your buy-sell agreement, call Jeana at 602-906-4953, ext. 4.