Term clause: Copy, customize, and use instantly
Introduction
A term clause specifies the duration of an agreement, including when it starts and when it ends. It provides clarity on the timeline for the obligations of both parties and sets expectations for the agreement’s lifecycle. A well-drafted term clause helps avoid disputes about when an agreement begins or ends.
Below are term clause templates tailored to different scenarios. Copy the one you need, customise it, and add it to your contract.
Fixed term clause
This clause specifies a clear start and end date for the agreement.
This agreement will commence on [insert start date] and will continue in effect until [insert end date], unless terminated earlier in accordance with the provisions of this agreement.
Renewable term clause
This clause allows the agreement to automatically renew unless one party opts out.
This agreement will commence on [insert start date] and will continue for an initial term of [insert initial term, e.g., “one year”]. Thereafter, the agreement will automatically renew for successive terms of [insert renewal term, e.g., “one year”], unless either party provides written notice of non-renewal at least [insert notice period, e.g., “30 days”] before the end of the current term.
Evergreen term clause
This clause ensures the agreement remains in effect indefinitely unless terminated.
This agreement will commence on [insert start date] and will continue in effect indefinitely, unless terminated by either party upon [insert notice period, e.g., “90 days”] written notice.
Trial term clause
This clause establishes a short-term trial period for evaluation purposes.
This agreement will commence on [insert start date] and will remain in effect for a trial period of [insert duration, e.g., “30 days”]. At the end of the trial period, the agreement will automatically terminate unless extended in writing by mutual agreement of the parties.
Fixed term with renewal conditions clause
This clause allows renewal of the agreement only under specified conditions.
This agreement will commence on [insert start date] and will continue in effect until [insert end date]. Renewal of this agreement will require mutual written agreement by the parties, subject to the successful fulfillment of [insert conditions, e.g., “performance metrics” or “payment obligations”].
Project-based term clause
This clause ties the agreement’s duration to the completion of a project or deliverable.
This agreement will commence on [insert start date] and will continue until the completion of [insert project or deliverable]. The agreement will terminate automatically upon the delivery and acceptance of the final deliverables, unless extended by mutual written agreement.
Fixed term with early termination option clause
This clause allows for early termination within a fixed-term agreement.
This agreement will commence on [insert start date] and will continue in effect until [insert end date]. Either party may terminate the agreement earlier by providing [insert notice period, e.g., “30 days”] written notice to the other party.
Performance-based term clause
This clause ties the agreement’s term to the achievement of performance goals.
This agreement will commence on [insert start date] and will remain in effect until the parties achieve [insert performance goal, e.g., “a minimum sales target of $1,000,000”] or until [insert end date], whichever occurs first.
Milestone-driven term clause
This clause sets the agreement’s duration based on the completion of key milestones.
This agreement will commence on [insert start date] and will remain in effect until the completion of the following milestones: [list milestones]. The agreement will terminate automatically upon the successful completion of all milestones, unless extended in writing.
Term with mutual termination clause
This clause allows termination only if both parties agree.
This agreement will commence on [insert start date] and will remain in effect until [insert end date]. Early termination is permitted only upon mutual written agreement of both parties.
Term with probationary period clause
This clause introduces a probationary period at the start of the term.
This agreement will commence on [insert start date] and will remain in effect for an initial probationary period of [insert duration, e.g., “90 days”]. Following the probationary period, the agreement will automatically continue for [insert term, e.g., “one year”], unless terminated by either party during the probationary period.
Rolling term clause
This clause establishes a continuous term with a rolling renewal mechanism.
This agreement will commence on [insert start date] and will continue on a rolling basis, renewing automatically each [insert renewal period, e.g., “month”] unless terminated by either party with [insert notice period, e.g., “30 days”] written notice.
Term tied to regulatory approval clause
This clause ties the agreement’s term to obtaining or maintaining regulatory approval.
This agreement will commence on [insert start date] and will continue in effect until [insert end date]. However, the agreement is contingent upon the parties obtaining and maintaining [insert regulatory approval, e.g., “FDA certification”]. Failure to obtain or maintain such approval will result in immediate termination.
Seasonal term clause
This clause establishes a term specific to seasonal activities or operations.
This agreement will commence on [insert start date] and will remain in effect only during the seasonal period of [insert timeframe, e.g., “June 1 to August 31 each year”]. The agreement will automatically renew for subsequent seasonal periods unless terminated by either party with [insert notice period] written notice.
Adjustable term clause
This clause allows the term to be adjusted based on mutual agreement during its duration.
This agreement will commence on [insert start date] and will remain in effect for an initial term of [insert term, e.g., “one year”]. During the term, the parties may mutually agree to adjust the duration by executing a written amendment to this agreement.
Indefinite term clause with specific exit events
This clause sets an indefinite term but ties termination to specific events.
This agreement will commence on [insert start date] and will continue indefinitely, unless terminated upon the occurrence of one of the following events: [list events, e.g., “bankruptcy of either party, completion of the project, or mutual agreement”].
Term with rolling evaluation clause
This clause allows periodic reviews to evaluate the continuation of the term.
This agreement will commence on [insert start date] and will remain in effect for an initial term of [insert duration, e.g., “two years”]. The parties agree to evaluate the agreement every [insert period, e.g., “six months”] to determine whether to continue or terminate.
Dual-layer term clause
This clause creates separate terms for different parts of the agreement.
This agreement will commence on [insert start date] and will remain in effect for a general term of [insert duration, e.g., “five years”]. However, obligations under [specific sections, e.g., “intellectual property rights”] will continue indefinitely unless terminated by written agreement.
Interim term clause
This clause creates an interim term before the full agreement begins.
This agreement will commence on [insert start date] and remain in effect for an interim term of [insert duration, e.g., “three months”], during which both parties may evaluate the terms. Upon successful completion of the interim period, the full term of [insert duration] will commence automatically.
Legacy term clause
This clause extends obligations for specific aspects of the agreement beyond the main term.
This agreement will commence on [insert start date] and remain in effect until [insert end date]. However, provisions related to [specific obligations, e.g., “confidentiality and indemnification”] will survive termination and remain binding for an additional [insert duration].
Dynamic term clause
This clause allows the term to change based on external factors.
This agreement will commence on [insert start date] and will remain in effect until [insert end date]. The term may be adjusted automatically based on [insert condition, e.g., “market conditions, regulatory changes, or performance metrics”], with written notification to the other party.
Term with performance-based extension clause
This clause extends the term if specific performance goals are met.
This agreement will commence on [insert start date] and remain in effect for an initial term of [insert duration, e.g., “one year”]. If the parties meet or exceed [insert performance criteria], the term will automatically extend for an additional [insert duration].
Fixed term with rolling sunset clause
This clause establishes a fixed term with phased reduction of obligations.
This agreement will commence on [insert start date] and remain in effect until [insert end date]. Obligations under the agreement will phase out in rolling stages, with [insert obligations, e.g., “payment terms”] ending first, followed by [insert other obligations, e.g., “reporting requirements”].
Reverse term clause
This clause applies retroactively to cover past actions.
This agreement will commence on [insert start date] and will apply retroactively to [insert earlier date, e.g., “January 1, 2023”], covering all actions, obligations, and rights between the parties from that date forward.
Floating term clause
This clause creates an undefined term that ends upon the occurrence of an agreed event.
This agreement will commence on [insert start date] and will continue in effect until the occurrence of [insert event, e.g., “a change of ownership, the conclusion of litigation, or the resolution of specific conditions”].
Term with pre-agreement obligations clause
This clause binds the parties to certain obligations before the agreement’s official term begins.
This agreement will commence on [insert start date] and remain in effect until [insert end date]. The parties further agree to fulfill specific obligations related to [insert topic, e.g., “preliminary due diligence or initial project setup”] before the official term begins.
Term with escalation period clause
This clause allows for a defined escalation period before termination.
This agreement will commence on [insert start date] and remain in effect until [insert end date]. Before termination, the parties must engage in a [insert duration, e.g., “30-day”] escalation period to attempt resolution of any outstanding disputes.
Term with phased start clause
This clause staggers the commencement of obligations over time.
This agreement will commence on [insert start date] and remain in effect until [insert end date]. Obligations under the agreement will commence in phases, with [insert obligation, e.g., “initial payment”] beginning immediately and [insert obligation, e.g., “delivery of services”] commencing [insert later date].
Time-capped term clause
This clause limits the agreement to a total cumulative term across renewals.
This agreement will commence on [insert start date] and remain in effect for an initial term of [insert duration]. The total cumulative term, including all renewals, may not exceed [insert maximum duration, e.g., “five years”].
Term with cascading obligations clause
This clause ensures specific obligations continue even after the term ends.
This agreement will commence on [insert start date] and remain in effect until [insert end date]. Certain obligations, including [insert specific obligations, e.g., “confidentiality, dispute resolution, and warranties”], will cascade beyond termination and remain enforceable.
Conditional term activation clause
This clause delays the start of the term until specific conditions are met.
This agreement will commence on the date that [insert condition, e.g., “regulatory approval is obtained” or “funding is secured”] and will continue for a term of [insert duration] from that date.
Term with rolling milestones clause
This clause ties the agreement’s continuation to the completion of rolling milestones.
This agreement will commence on [insert start date] and remain in effect, subject to the completion of rolling milestones. Each milestone must be achieved within [insert timeframe], and failure to meet a milestone will result in automatic termination of the agreement.
Term with adaptive renewal periods clause
This clause adjusts renewal periods dynamically based on performance or circumstances.
This agreement will commence on [insert start date] and continue for an initial term of [insert duration]. Renewal periods will vary based on mutual agreement, subject to the achievement of [insert criteria, e.g., “specific sales thresholds”] or changing market conditions.
Event-driven term clause
This clause links the agreement’s termination to an external event.
This agreement will commence on [insert start date] and remain in effect until the occurrence of [insert event, e.g., “a market shift,” “acquisition of one party,” or “regulatory repeal of relevant laws”].
Term with periodic reset clause
This clause resets the term’s conditions at regular intervals.
This agreement will commence on [insert start date] and remain in effect for an initial term of [insert duration]. At the end of each term, the agreement will reset with identical conditions unless modified by mutual agreement.
Fixed term with opt-in extension clause
This clause requires an active decision to extend the term beyond the initial duration.
This agreement will commence on [insert start date] and remain in effect for an initial term of [insert duration]. The term may be extended only if both parties opt in by providing written consent no later than [insert deadline before end date].
Term with shared end-of-term review clause
This clause requires a collaborative review before extending or terminating.
This agreement will commence on [insert start date] and remain in effect until [insert end date]. Before the term concludes, the parties will conduct a joint review to assess whether to extend, renegotiate, or terminate the agreement.
Term with environmental trigger clause
This clause allows termination based on environmental or sustainability benchmarks.
This agreement will commence on [insert start date] and remain in effect until [insert end date]. Either party may terminate the agreement earlier if [insert environmental trigger, e.g., “sustainability targets are not met” or “adverse environmental impacts are identified”].
Term with legacy application clause
This clause provides ongoing application for certain elements of the agreement.
This agreement will commence on [insert start date] and remain in effect until [insert end date]. Certain provisions, including [insert provisions, e.g., “intellectual property and indemnification”], will continue to apply after the term’s expiration.
Progressive term clause
This clause incrementally increases or adjusts the term’s obligations over time.
This agreement will commence on [insert start date] and remain in effect until [insert end date]. Obligations under this agreement will progressively increase or adjust based on [insert condition, e.g., “project stages,” “scaling of deliverables,” or “sales growth”].
Crisis-specific term clause
This clause activates during specific crises and remains active for a defined duration.
This agreement will commence on [insert start date] and remain in effect for the duration of [insert crisis, e.g., “a declared state of emergency” or “a supply chain disruption”], not exceeding [insert maximum duration, e.g., “12 months”].
Proportional term clause
This clause ties the term’s duration to proportional metrics, such as usage or performance.
This agreement will commence on [insert start date] and remain in effect for as long as [insert proportional metric, e.g., “services are utilized” or “performance quotas are achieved”], not exceeding [insert maximum term, e.g., “three years”].
Tiered term clause
This clause assigns different terms for different sections or obligations.
This agreement will commence on [insert start date] and remain in effect for a general term of [insert duration]. However, specific obligations, such as [insert obligation, e.g., “confidentiality” or “payment terms”], will have independent terms as specified in [insert schedule or section].
Term with exclusivity cap clause
This clause allows for exclusivity only during a defined term.
This agreement will commence on [insert start date] and remain in effect until [insert end date]. The exclusivity granted under this agreement will terminate automatically on [insert exclusivity end date], even if the broader agreement remains active.
Term with staggered obligations clause
This clause staggers the start and end dates of various obligations within the term.
This agreement will commence on [insert start date] and remain in effect until [insert end date]. Obligations under this agreement will have staggered start and end dates as specified in [insert attachment or schedule].
Term with anticipatory extension clause
This clause allows the parties to agree on an extension before the term begins.
This agreement will commence on [insert start date] and remain in effect for an initial term of [insert duration]. The parties may agree to an extension of the term at any time prior to its commencement, which will be documented in writing.
Fixed term with staggered renewal conditions clause
This clause sets a fixed term but renewals are contingent on staggered conditions.
This agreement will commence on [insert start date] and remain in effect until [insert end date]. Renewals will only be granted upon fulfillment of [insert first condition] for the first renewal and [insert subsequent condition] for any subsequent renewals.
Term with rolling party consent clause
This clause requires ongoing mutual consent for the agreement to continue.
This agreement will commence on [insert start date] and will remain in effect as long as both parties provide written consent to continue, with renewals to be confirmed every [insert duration, e.g., “12 months”].
Term with cumulative milestone expiration clause
This clause sets the agreement’s term to expire after a cumulative number of milestones.
This agreement will commence on [insert start date] and will terminate automatically after the completion of [insert number] milestones, regardless of the duration required to achieve them.
Elastic term clause
This clause allows the agreement to automatically extend or shorten based on activity levels.
This agreement will commence on [insert start date] and remain in effect until [insert end date]. The term may extend or shorten proportionally to [insert activity metric, e.g., “monthly usage” or “performance goals”].
Term with optional suspension clause
This clause allows either party to temporarily suspend the agreement without terminating it.
This agreement will commence on [insert start date] and remain in effect until [insert end date]. Either party may suspend the agreement for up to [insert time period, e.g., “six months”] by providing written notice, after which the agreement will resume under its original terms.
Term with phased conclusion clause
This clause defines a phased approach to winding down the agreement at the end of its term.
This agreement will commence on [insert start date] and remain in effect until [insert end date]. Upon expiration, the agreement will enter a [insert time period] phased conclusion period, during which obligations will gradually reduce until complete termination.
Term with predefined early exit clause
This clause defines specific dates when either party may exit early without penalties.
This agreement will commence on [insert start date] and remain in effect until [insert end date]. Either party may terminate the agreement without penalty on the following dates: [insert specific dates], by providing written notice at least [insert notice period] in advance.
Fixed term with equitable adjustment clause
This clause allows the term to adjust fairly based on unforeseen circumstances.
This agreement will commence on [insert start date] and remain in effect until [insert end date]. If unforeseen circumstances arise that materially affect the obligations of either party, the term may be equitably adjusted by mutual agreement.
Event-specific term clause
This clause ties the term to the occurrence of a series of specific events.
This agreement will commence on [insert start date] and remain in effect until the occurrence of all the following events: [list events]. The agreement will terminate automatically upon the final event’s completion.
Contingent renewal term clause
This clause makes the renewal contingent on an independent event or condition.
This agreement will commence on [insert start date] and remain in effect for an initial term of [insert duration]. Renewal is contingent upon [insert condition, e.g., “regulatory approval” or “successful audit results”].
Backdated term clause
This clause retroactively applies the agreement to cover actions taken before signing.
This agreement will commence on [insert start date] and apply retroactively to cover all activities, obligations, and rights arising from [insert earlier date]. The term will end on [insert end date].
Term with sector-specific obligations clause
This clause links the term to the lifecycle of a specific industry activity.
This agreement will commence on [insert start date] and remain in effect for the duration of [insert industry activity, e.g., “a construction project” or “a product lifecycle”], subject to extensions or modifications based on industry standards.
Reactive term clause
This clause allows the term to react dynamically to external market or legal changes.
This agreement will commence on [insert start date] and remain in effect until [insert end date]. The term may be modified automatically based on [insert condition, e.g., “market volatility” or “new regulatory requirements”].
Consecutive engagement term clause
This clause allows the agreement to remain in effect only if engagements are continuous.
This agreement will commence on [insert start date] and remain in effect as long as engagements between the parties are consecutive, with no gap exceeding [insert time period, e.g., “90 days”]. The agreement will terminate automatically if such a gap occurs.
Incremental renewal term clause
This clause increases the term length for each subsequent renewal.
This agreement will commence on [insert start date] and remain in effect for an initial term of [insert duration]. Each renewal term will incrementally increase by [insert duration, e.g., “six months”], subject to mutual agreement.
Term with predefined event freeze clause
This clause freezes the term in case of specific events, pausing obligations temporarily.
This agreement will commence on [insert start date] and remain in effect until [insert end date]. The term will pause automatically upon the occurrence of [insert event, e.g., “force majeure” or “regulatory investigations”] and resume when the event concludes.
Maximum engagement cap term clause
This clause sets a hard limit on the total engagements or transactions within the term.
This agreement will commence on [insert start date] and remain in effect until [insert end date]. The agreement will terminate automatically upon the completion of [insert maximum number] engagements or transactions, whichever occurs first.
Non-consecutive term clause
This clause allows for non-continuous periods of engagement during the agreement's lifespan.
This agreement will commence on [insert start date] and remain in effect until [insert end date]. The parties may engage in non-consecutive terms of activity, provided that any inactive period does not exceed [insert time period, e.g., “six months”].
Escrow-based term clause
This clause ties the agreement’s duration to the release of escrow funds or assets.
This agreement will commence on [insert start date] and remain in effect until all funds or assets held in escrow under this agreement are fully released, or [insert maximum duration, e.g., “three years”], whichever occurs first.
Contingent phased term clause
This clause creates distinct phases with each phase contingent on specific outcomes.
This agreement will commence on [insert start date] and remain in effect for Phase 1 of [insert duration]. Subsequent phases will commence only upon the fulfillment of [insert condition, e.g., “completion of Phase 1 deliverables” or “payment of Phase 1 milestones”].
Provisional term clause
This clause creates a provisional term that can become permanent if no objections arise.
This agreement will commence on [insert start date] and remain in effect provisionally for [insert duration]. If no objections are raised during this period, the agreement will automatically convert to a permanent term of [insert subsequent term duration].
Term with rotating party roles clause
This clause defines alternating roles for each party during successive terms.
This agreement will commence on [insert start date] and remain in effect until [insert end date]. During the initial term, [Party A] will act as [insert role], while [Party B] will act as [insert role]. For each renewal term, the roles will alternate unless otherwise agreed in writing.
Gradual transition term clause
This clause creates a defined transition period at the start or end of the agreement.
This agreement will commence on [insert start date] and remain in effect until [insert end date]. The parties will engage in a gradual transition period of [insert duration] at the beginning and end of the term to ensure a seamless start and conclusion.
Renewable term with exclusive renegotiation period clause
This clause grants an exclusive renegotiation period before renewal.
This agreement will commence on [insert start date] and remain in effect for an initial term of [insert duration]. Before each renewal, the parties will engage in an exclusive renegotiation period of [insert duration], during which no alternative agreements may be pursued.
Term with rolling approval clause
This clause requires periodic approval to continue beyond preset intervals.
This agreement will commence on [insert start date] and remain in effect for successive intervals of [insert duration, e.g., “six months”], subject to written approval by both parties at the conclusion of each interval.
Term tied to intellectual property lifecycle clause
This clause links the term to the lifecycle of specific intellectual property.
This agreement will commence on [insert start date] and remain in effect for the lifecycle of [insert intellectual property, e.g., “patent number” or “trademark registration”]. The agreement will terminate automatically upon the expiration or invalidation of the intellectual property.
Crisis-activated term clause
This clause activates only during specific crises and remains dormant otherwise.
This agreement will remain dormant unless and until [insert event, e.g., “a natural disaster” or “a declared state of emergency”] occurs. Upon activation, the agreement will remain in effect for a term of [insert duration] or until the crisis is resolved.
Cooperative term clause
This clause ties the term to the ongoing collaboration between the parties.
This agreement will commence on [insert start date] and remain in effect as long as both parties actively collaborate on [insert project or goal]. The term will automatically terminate if cooperation ceases for more than [insert time period].
Incremental project-based term clause
This clause sets incremental terms for a series of projects.
This agreement will commence on [insert start date] and remain in effect for the duration of [insert initial project]. The agreement will automatically extend for subsequent projects, subject to mutual written agreement prior to each project’s start.
Term with time-locked modifications clause
This clause prohibits modifications to the term during a specified period.
This agreement will commence on [insert start date] and remain in effect until [insert end date]. No modifications to the term may be made during the first [insert time period, e.g., “six months”] of the agreement’s duration.
This article contains general legal information and does not contain legal advice. Cobrief is not a law firm or a substitute for an attorney or law firm. The law is complex and changes often. For legal advice, please ask a lawyer.