Clause guide
Termination for Breach clause: meaning, risks, and what to negotiate
Allows a contract to be terminated if one party materially breaches the agreement.
What it means
Termination rights protect parties when the other side fails to meet key obligations.
Common risks
- • The breach definition may be too narrow.
- • Cure periods may delay termination.
- • You may have fewer termination rights than the other party.
What to check before signing
- • What counts as a material breach?
- • Is there a cure period?
- • Are termination rights mutual?
Negotiation ideas
- • Define material breach clearly.
- • Keep cure periods reasonable.
- • Ensure both parties have similar termination rights.
Example clause
“Either party may terminate this Agreement if the other party materially breaches the Agreement and fails to cure such breach within thirty (30) days.”
Frequently asked questions
What is a material breach?
A material breach is a serious failure that defeats the main purpose of the contract.
Related clauses
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