Many technology-related service agreements between providers and their customers now include terms beyond the four corners of the document. Specifically, certain contract terms are incorporated as mere hyperlinks to a URL where the provider’s standard terms and provisions are maintained.
It has become fairly commonplace for companies of all sizes and industries to tout a commitment to ethical and socially-conscious business practices as a key differentiator in their respective markets. For example, a clothing company might distinguish itself by its commitment to sustainable manufacturing practices that include waste recycling and efficient water usage systems. Aside from being a means of establishing brand identity, this promise also may help a company attract capital from investors who share a similar sense of social responsibility. Regardless of the reason, companies who choose to adopt standards which exceed basic government guidelines must take appropriate steps to ensure the fulfillment of such promised social and ethical obligations.
Just as the reasons why parties choose to terminate a contract will vary, so too will the nature of the relationship between the parties, as well as the complexity of the original business arrangement. Sophisticated relationships and complex deal terms often necessitate the inclusion of additional provisions in the termination agreement. In Part 2 of this series, we review those terms which are illustrative of a more complex termination arrangement:
In business, as in life, things don’t always work out as expected. When the parties to a contract wish to end their relationship (for any number of reasons, such as dissatisfaction with goods/services, better pricing found elsewhere, or simply a desire to walk away from the deal), a termination agreement enables them to formally cancel their contract before its expiration date[1]. In this two-part series, we will examine the basic provisions found in most termination agreements (part 1), as well as more complex provisions that are often required in more sophisticated transactions (part 2).
A non-solicitation clause is a provision in a contract generally prohibiting the hiring (or attempting to hire) of one of the other party’s employees or contractors. It can be thought of as an “anti-poaching” provision. Often, vendors will add such a provision to keep its customers or clients from poaching the vendor’s employees in an attempt to avoid using the vendor by bringing the vendor’s expertise in house. When this happens, the vendor loses not only a key employee, but also, in many case, a client.
The coronavirus has toppled business as we know it, and many companies are attempting to right themselves by scaling back, including seeking to be excused from contractual obligations pursuant to a “force majeure” provision in their agreements. Force majeure is one of a handful of standard “boilerplate” contract terms that is often skimmed over (at best) or overlooked by the parties, given its relative unimportance as compared to more substantive provisions. However, when faced with unexpected and/or uncontrollable circumstances, a precisely worded force majeure clause can sometimes offer a lifeline that will excuse one party’s performance obligations.
When you are a vendor providing goods/services to a customer, the most critical issues in a SOW are those relating to the description of services, payment, and the terms of acceptance. These provisions should be written with clarity and specificity. The remainder of the terms, while important, do not require the same level of detail. To help guide the providing party in its review or preparation of a SOW, consider the following:
As discussed in Part 1, a SOW should tell a story with enough detail that a person who is unfamiliar with the deal could rely on it to understand the intentions of the parties, including such key terms as products/services, deliverables and pricing.
