On January 1, 2020, Able Inc. (Able) entered into a supply agreement with Baker Corp. (Baker) pursuant to which Able agreed to purchase from Baker 100,000 widgets in each year of the contracts five-year term. The contract contained the following termination and dispute provisions: Section 10. Term. This agreement shall be effective from the date it is made and shall continue in force for a period of five (5) years and thereafter for successive five-year terms, unless and until terminated by one years prior notice in writing by either party. Section 11. Dispute Resolution. In the event that a dispute arises under this Agreement, either party may elect, by prompt written notice to the other party, to submit the dispute to an arbitration panel. On June 30, 2020, a vice president at Able sends an email to her counterpart at Baker: This is to advise you that we are exercising our right to terminate the supply contract pursuant to Section 10 of the contract, effective June 30, 2021. This email comes as a complete shock to Bakers management, which had counted on the supply contract continuing until at least 2025. Immediately after receiving the email, Bakers vice president phones his counterpart at Able and says, Whats this all about? Under our contract, the earliest you can terminate the agreement is January 1, 2025, and you do that by sending us a notice one year before, on January 1, 2024. You have no right to terminate the contract any earlier. Ables vice president responds, Well, we obviously disagree. The termination provision gives us the right to end the contract anytime by giving you one years notice. Thats what the provision says and thats what we did and what we talked about during negotiations. I guess well see you in court if you stick to your guns on this. You are a manager at Able Inc. and work for the vice president who had had these communications with Baker. The vice president calls you into her office and fills you in on the situation. Were obviously headed for war with Baker, and since you were involved in the negotiations of the supply contract, I want you to take charge of this brewing dispute so that were prepared. I want you to do three things: First, send me and Simon Jones, the Executive Vice President, a memo describing in detail your recollection of the negotiations and your interpretation of the contract provisions at issue and cc our general counsel so that its privileged. Second, make sure our files are purged of any damaging emails or other material that could hurt us in litigation. Third, since either party has the right to have the dispute arbitrated instead of litigated, give me your list of the top three or four pros and cons of arbitration versus litigation. Based on this hypothetical scenario, answer the following questions:

Your boss has asked you to be the point person on behalf of Able in connection with the potential dispute with Baker involving the supply agreement. What initial steps would you take to prepare your company for a possible litigation or arbitration? For purposes of this question, assume that Able's policies and procedures relating to contract administration and legal matters are the same as those of your organization?