What is Early Termination Agreement Drafting?
An early termination agreement is a legal contract that terminates an agreement before its expiration date. Mutual consent from both parties is required to prevent disputes.
If you need to draft an early termination agreement, read the rest of this article for clarity about key terms to include in the contract, how to draft it, and the benefits of hiring a qualified lawyer for help with the drafting process.
What are Key Terms in an Early Termination Agreement?
An early termination agreement should include the following core components:
- Parties. State both parties involved in the agreement, such as the landlord and tenant in a residential lease.
- Termination. Explain the date on which the agreement ends.
- Financial terms. This section includes early termination fees and unpaid balances, such as rent.
- Mutual release of claims. This section should release parties from any future obligations and liabilities.
- Notice period. State when written notice is required before the agreement termination becomes official.
- Representations and warranties. Include statements from parties that confirm they have the authority to enter the agreement.
How Do You Draft an Early Termination Agreement?
When writing terms in an early termination agreement, there are some things to bear in mind so that everything is clear and specific.
Refer to the Original Contract
Make sure that you check the original agreement before drafting an early termination agreement. This enables you to confirm what early termination clauses were included and what is required of parties. It also prevents confusion or contradictions between contracts.
Include a Release of Claims
The agreement must state that parties agree not to hold future claims against each other once the terms in the contract have been fulfilled. This is important to protect your interests.
Consider Post-Termination Obligations
For clarity between parties, you should consider what is required of them to properly exit the agreement. For example, there might be data or equipment that has to be returned after the agreement ends. Or, there might be outstanding payments that have to be completed.
There could also be clauses or obligations that will survive the agreement termination and which you shouldn’t forget about. Be clear about them in the agreement, such as confidentiality clauses, so that parties know what’s required of them after the contract ends.
Provide Notice Periods
To ensure both parties have enough time in which to prepare for the end of the contract, such as if they require transitional support, you need to include fair and reasonable notice periods.
Should You Hire a Lawyer for Early Termination Agreement Drafting?
Ending a contract early can have legal and financial consequences, which is why it’s in your best interests to hire a lawyer to draft your early termination agreement for you.
During the contract drafting process, a lawyer can help you by conducting activities such as the following:
- Setting termination terms. A lawyer will write clear, specific terms for effectively ending the arrangement so that parties know what to expect.
- Considering contractual obligations. They’ll consider notice requirements and early termination fees, as well as any other conditions stipulated in the original contract. This prevents confusion or contradictions.
- Allocating financial obligations. They’ll explain how unpaid money and deposits will be settled after the agreement ends.
- Outlining post-termination duties. An experienced lawyer will consider what’s required of the parties after the agreement ends, such as how property must be returned to its rightful owner.
- Reducing the risk of future disputes. A lawyer will clarify if and how parties release claims against the other.
- Making the agreement legal. They’ll ensure all agreement terms are aligned with the relevant legal requirements and laws.
- Reviewing the agreement. If you’ve already drafted an early termination agreement, you can hire a lawyer to look over it so that you feel confident you don't miss anything important that should be included in the contract.
Find and Hire a Lawyer for Early Termination Agreement Drafting
Hiring a lawyer to draft your early termination agreement doesn’t have to be a stressful experience. Instead of having to find a lawyer by reaching out to traditional law firms or calling people you know for lawyer recommendations, you can make use of an online legal platform that gives you access to a range of lawyers who are experienced and reputable.
ContractsCounsel is one of the largest online legal marketplaces where you can easily find a lawyer by connecting with a curated network of vetted lawyers. Since the platform provides transparent information about lawyers you can hire, you can review their data before selecting one to work with.
If you need to ask a lawyer to draft your early termination agreement, follow these steps:
- Go to the ContractsCounsel marketplace.
- Select ‘One-time project’ and ‘Create or update contract.’ If you’d prefer to review your agreement, choose ‘Contract review’.
- Post your project for free. Mention some details of what you need so you match with the right lawyers on the platform.
- Wait for lawyer bids. Instead of searching for a lawyer, lawyers directly on the platform will reach out to you and send you bids on your project.
- Review the platform’s lawyer data. ContractsCounsel provides extensive lawyer information, such as their location, expertise and credentials, years of experience, and client ratings for previously completed projects on the platform. This will help you to choose a suitable lawyer.
- Select a lawyer to draft or review your early termination agreement for a flat fee.
