Termination Clause
What it is
A termination clause defines how the contract ends: who can trigger termination, under what conditions, what notice is required, and what happens to compensation for work already done. It covers both termination for cause (a party did something wrong) and termination for convenience (one side simply decides to stop).
Why it matters to you
Asymmetric termination is one of the clearest signs of a lopsided contract. If the client can exit at any time for any reason while you need cause and 90 days' notice to do the same, you carry all the risk. If termination wipes out payment for work already completed, you may have performed weeks of work for nothing. A balanced clause gives both sides the same exit rights and protects compensation for work in progress.
The aggressive version
This termination language gives the client full flexibility to exit while leaving you with minimal protection.
Client may terminate this Agreement at any time, with or without cause, upon five (5) days' written notice. Upon termination, Client's sole obligation is to pay for work completed and accepted prior to the termination notice. Contractor may terminate this Agreement only for material breach by Client that remains uncured for thirty (30) days following written notice, and only upon ninety (90) days' additional written notice.
What each part does to you
“at any time, with or without cause”
The client can exit any time for any reason. No justification required, no minimum commitment.
“five (5) days' written notice”
Five days is less than a work week. You have almost no time to transition or recover your capacity.
“completed and accepted prior to the termination notice”
No kill fee for work in progress. Any milestone you were working on when they sent the notice is not owed to you.
“ninety (90) days' additional written notice”
You need cause plus ninety extra days to exit. The client exits in five days for any reason. This is not a balanced clause.
The market standard version
A symmetric termination clause gives both sides the same rights and compensates the contractor for work already done.
Either party may terminate this Agreement for convenience upon thirty (30) days' written notice. In the event of termination for convenience by Client, Client shall pay: (a) all fees for work completed through the termination date; and (b) a kill fee equal to twenty-five percent (25%) of the remaining contract value. Either party may terminate immediately for the other party's material breach that remains uncured for ten (10) business days following written notice.
Your counter-language
This version balances exit rights and adds a kill fee for work in progress.
Either party may terminate this Agreement upon thirty (30) days' written notice without cause. Upon termination by Client: Contractor shall be paid in full for all work completed through the notice date, plus a cancellation fee equal to twenty-five percent (25%) of the remaining unbilled contract value. Upon termination by Contractor: Contractor shall complete work in progress through the notice period. Either party may terminate immediately upon the other party's material breach that remains uncured for seven (7) business days after written notice.
What to ask for
“Can we make termination rights symmetric — same notice period for both sides?”
“Can we add a kill fee for work in progress if you terminate for convenience, equal to a percentage of the remaining contract value?”
“Can we shorten the cure period for breach to 10 business days rather than 30 calendar days?”
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ClauseCheck is not a law firm and does not provide legal advice. The clause examples and counter-language on this page are illustrative only and are not a substitute for advice from a qualified attorney. Contract terms vary by context; consult a lawyer before making decisions on any specific agreement.
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