An MSA sets the overarching terms governing ongoing services between parties, providing a foundation for future statements of work or projects. This playbook breaks down best practices for managing risk, defining scope, and balancing flexibility with legal protection.
Why This Matters: Robust termination provisions protect against being locked into unfavorable arrangements and limit post-termination liabilities.
Negotiation strategy
If you're the Company:
Ensure the termination clause aligns with your strategic exit plans. Negotiate for specific termination triggers that protect your interests and include reasonable notice periods.
If you're the Contractor:
Advocate for clear and fair termination terms that allow flexibility. Ensure post-termination obligations are limited and manageable.
Essential elements
1
Contract Duration
Defines the length of the contract.
2
Renewal Conditions
Outlines terms for contract renewal.
3
Termination Triggers
Specifies events that allow termination.
Action framework
ACCEPT
Propose edits when termination triggers are vague or notice periods are too short.
EDIT
Reject if the clause lacks clear termination rights or imposes excessive post-termination obligations.
ADD
Add language if the clause is missing or lacks jurisdiction-specific requirements.
PRO TIP
Always align termination provisions with your business's risk management strategies.
Example clauses
FAVORABLE
Preferred Termination Clause
"This Agreement shall commence on [Start Date] and continue for a period of [Duration]. Either party may terminate this Agreement upon [Notice Period] written notice if [Termination Trigger]. Upon termination, the parties shall fulfill any outstanding obligations as outlined in [Post-Termination Obligations]."
NEUTRAL
Standard Termination Clause
"The Agreement may be terminated by either party with [Notice Period] notice if [General Termination Trigger]."
UNFAVORABLE
Open-Ended Termination Clause
"The Agreement shall continue indefinitely unless terminated by mutual consent."
Fallbacks
High-Risk Projects
In high-risk projects, ensure termination clauses allow for quick exits to mitigate potential losses. Include specific risk-related triggers.
Long-Term Partnerships
For long-term partnerships, focus on renewal conditions and ensure termination rights are balanced to maintain relationship stability.
Jurisdiction-Specific Contracts
Adjust termination clauses to comply with local laws, ensuring notice periods and triggers meet jurisdictional requirements.
FEATURED SOLUTIONS
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WEEK 1
CLM Readiness and Design
Our CX team works with you to understand your contracting challenges, prioritize key workflows, and identify the biggest impact areas. We build a tailored implementation plan that fits your needs.
WEEK 2
Install Module
We connect DocJuris to your contract repositories, set up admin and user accounts, and ensure your environment is ready for success.
WEEK 3
Deliver & Test
Your team builds initial playbooks, reviews existing clause libraries, and trains the DocJuris agent to align with your internal standards and negotiation positions.
WEEK 4
Launch
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DocJuris is not a law firm or a substitute for an attorney or law firm. We cannot provide any kind of advice, explanation, opinion, or recommendation about possible legal rights, remedies, defenses, options,selection of forms or strategies.