6
PLAYBOOK TEMPLATES
Memorandum of Understanding (MOU)
An MOU establishes the foundational understanding between parties prior to definitive agreements. This playbook reviews negotiation of commitments, timelines, and governance structures.
Termination Rights
Negotiation strategy
Negotiate for clear termination rights that allow for exit in cases of material breach or convenience. Ensure that notice periods are reasonable and that transition assistance is included to protect ongoing operations.
Aim to limit termination rights to specific breaches and ensure that any termination for convenience includes adequate notice. Negotiate compensation for transition assistance to cover costs incurred.
Essential elements
1
Material Breach
Allows exit if obligations breached.
2
Convenience Termination
Exit with notice, no penalties.
3
Transition Assistance
Support for smooth operational handover.
Action framework
ACCEPT
Propose edits if notice periods are too short or transition assistance is not adequately covered.
EDIT
Reject if termination rights are overly restrictive or lack clarity.
ADD
Add clauses for transition assistance and survival of obligations if missing.
PRO TIP
Ensure that termination rights align with strategic goals and include provisions for transition assistance to minimize disruption.
Real-world examples
FAVORABLE
Termination for Material Breach
"In the event that either party commits a material breach of any of its obligations under this Agreement, the non-breaching party may terminate this Agreement by providing written notice to the breaching party, specifying the nature of the breach. The breaching party shall have thirty (30) days from the receipt of such notice to cure the breach. If the breach is not cured within the specified period, the Agreement shall terminate immediately upon the expiration of the cure period."
NEUTRAL
Termination for Convenience
"Either party may terminate this Agreement for convenience by providing the other party with sixty (60) days' prior written notice. Upon termination for convenience, neither party shall be liable to the other for any damages, indemnities, or penalties, except for obligations that have accrued prior to the date of termination."
UNFAVORABLE
Lack of Transition Assistance
"Upon termination, no transition assistance will be provided, leaving the Client to manage the transition independently."
Alternative scenarios & positions
High-Risk Projects
In high-risk projects, ensure termination rights are robust to allow for quick exit if project risks materialize. Include detailed transition assistance to mitigate operational impact.
Long-Term Contracts
For long-term contracts, include periodic review clauses to reassess termination rights and ensure they remain aligned with evolving business needs.
Cross-Border Agreements
In cross-border agreements, consider jurisdiction-specific termination requirements and ensure compliance with local laws to avoid enforceability issues.
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WEEK 3
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WEEK 4
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