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PLAYBOOK TEMPLATES

Joint Development Agreement (JDA)

A JDA sets forth terms for collaborative product or technology development, addressing ownership, confidentiality, and IP outcomes. This playbook highlights best practices for defining contributions, milestones, and dispute resolution.

Termination Provisions

Why This Matters: Effective termination clauses ensure underperforming agreements can be ended cleanly and help manage post-termination obligations, limiting liability and uncertainty.

Negotiation strategy

If you're the Company A:

Negotiate for clear termination rights to avoid being locked into unfavorable terms. Ensure the inclusion of a strategic exit clause to allow flexibility in business decisions.

If you're the Company B:

Seek to limit termination rights to protect ongoing revenue streams. Propose longer notice periods for termination to allow for operational adjustments.

Essential elements

1

Term of Agreement

Defines the agreement's duration.
2

Renewal Mechanics

Outlines automatic renewal terms.
3

Termination for Cause

Allows termination for breaches.

Action framework

ACCEPT

Propose edits if the termination terms are too restrictive or lack clarity on renewal mechanics.

EDIT

Reject clauses that impose excessive penalties or lack a cure period for breaches.

ADD

Add language to cover strategic exits and ensure post-termination obligations are clear.

PRO TIP

Always ensure termination clauses align with your strategic business goals and provide sufficient flexibility.

Example clauses

FAVORABLE

Preferred Termination Clause

"The term of this Agreement shall commence on the Effective Date and shall continue for a period of [insert duration], unless earlier terminated in accordance with the provisions of this Agreement."
NEUTRAL

Standard Renewal Clause

"Upon expiration of the initial term, this Agreement shall automatically renew for successive [insert duration] periods unless either party provides written notice of non-renewal to the other party at least [insert number] days prior to the expiration of the then-current term."
UNFAVORABLE

Restrictive Termination Clause

"Termination is only allowed upon mutual agreement, with no provisions for unilateral termination."

Fallbacks

High-Risk Projects

In high-risk projects, ensure termination clauses allow for quick exits to mitigate potential losses and liabilities.

Long-Term Partnerships

For long-term partnerships, focus on renewal mechanics that provide stability while allowing for periodic reviews.

Technology Agreements

In technology agreements, include specific termination rights related to performance metrics and service levels.
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