A Sponsorship Agreement outlines the terms under which one party provides funding or support for promotional exposure. This playbook details exclusivity, deliverables, and termination for reputational risk.
Why This Matters: Flexible termination rights reduce the risk of being locked into underperforming arrangements and limit exit costs.
Negotiation strategy
If you're the Client:
Negotiate for a short notice period for termination for convenience to maintain flexibility. Ensure that post-termination obligations are limited in duration and scope to avoid ongoing liabilities.
If you're the Agency:
Seek to include reasonable notice periods and termination penalties to protect against abrupt contract terminations. Ensure that post-termination obligations are clearly defined to prevent misuse of proprietary information.
Essential elements
1
Termination for Convenience
Allows termination without cause.
2
Notice Periods
Timeframe for termination notice.
3
Post-Termination Obligations
Duties after contract ends.
Action framework
ACCEPT
Propose edits if notice periods exceed 30 days or if post-termination obligations are overly burdensome.
EDIT
Reject clauses that impose excessive penalties or lack a cure period for breaches.
ADD
Add clauses if termination rights are not clearly defined or if post-termination obligations are missing.
PRO TIP
Always ensure termination clauses align with your strategic exit plans and risk management policies.
Example clauses
FAVORABLE
Preferred Termination for Convenience
"The Client may terminate this Agreement for convenience at any time by providing the Agency with thirty (30) days' written notice. Upon such termination, the Client shall be liable to pay for all services rendered and expenses incurred up to the effective date of termination."
NEUTRAL
Notice Periods
"All notices of termination must be in writing and delivered via certified mail, return receipt requested, or by a recognized overnight courier service. Notices shall be deemed given on the date of receipt as indicated by the return receipt or courier service records."
UNFAVORABLE
Excessive Termination Penalties
"In the event of termination for convenience by the Client, the Agency shall be entitled to a termination fee equal to 50% of the remaining contract value."
Fallbacks
High-Risk Projects
In high-risk projects, ensure termination clauses allow for quick exits to mitigate potential losses. Consider shorter notice periods and minimal penalties.
Long-Term Contracts
For long-term contracts, include periodic review clauses to assess performance and adjust termination terms as needed.
Jurisdiction-Specific Requirements
If governed by specific jurisdiction laws, adjust termination clauses to ensure compliance and enforceability.
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WEEK 1
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WEEK 2
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WEEK 3
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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
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