What Does Evergreen Mean

The question is whether Evergreen Clauses are enforceable, as their effect is to automatically bind a contracting party to an agreement beyond the original contract term.Not surprisingly, the enforceability of Evergreen Clauses can depend on the jurisdiction and the subject matter of the contract itself.

What Is an Evergreen Clause? As a general concept, an evergreen clause provides that the term of an agreement. will automatically renew for some period of time unless one party provides the. other party with notice before the end of the current term that it does not wish. to renew the term of the agreement.

Evergreen Contract Basics Sometimes a party can terminate the contract by simply notifying the other party in writing; other times there is a fee to cancel the contract that must be paid during the renewal period.

As a general concept, an evergreen clause provides that the term of an agreement. will automatically renew for some period of time unless one party provides the. other party with notice before the end of the current term that it does not wish. to renew the term of the agreement.

An evergreen contract automatically renews on or after the expiry date. The parties involved in the contract agree that it rolls over automatically until one gives the notice to terminate it.

The statute creates specific disclosure and notice of renewal requirements on contracts.The failure to comply with these statutory requirements may render an automatic renewal clause unenforceable and result in the contract being terminated at the end of the current term.

Evergreen clauses are common, useful, and enforceable in the context of service contracts. The automatic renewal provisions provide predictable continuity to the parties, while simultaneously allowing either party to cancel the automatic renewal with advance notice.