Learn the Basics of Contract Review

Learn the Basics of Contract Review.

Insight from Steve Thienel 

You’ve got a new contract in front of you, but the thousands of words are starting to blur together.

You’re not alone. 90% of professionals find contracts either difficult or downright impossible to understand.

Who among us hasn’t fallen asleep at their desk reading a contract at 1AM, fingers covered in dust after powering through a family-size bag of Flamin' Hot Cheetos? Just me? Okay great.

The reality is your legal team is too busy to teach you the basics. Heck, you’re probably the entire legal team at your startup.

Below are some simple areas that you can review before asking for help. 

Here’s your basic checklist:

• Agreement Term: Make sure the duration is correct, as are all key dates for deliverables.
  

• Payment Terms: Who pays who? How much do they pay? When do they need to pay by? Don’t forget to check late payment penalties, default terms, and remedies for default. 
  

• Termination: How do you terminate the agreement? How much notice do you have to give? If you’d like to renew the agreement, what steps need to be taken?

• Data Rights: Who owns what data? Who owns the work that’s being completed? Make sure that the terms align with your goals and with your industry’s compliance regulations.
  

• Regulatory Compliance: If you have a compliance framework, make sure it matches this section. You may need to make additions to ensure compliance.

Those are just the basics. If you have a legal team, now would be the time to pass it to them.

They’ll probably have very few notes and say everything looks great. That’s how that usually goes, right? 😉

Learn more: 10-Step Checklist for an Effective Contract Management Process