Auto-renewal clause
Also called Automatic renewal, Evergreen clause
An auto-renewal clause renews a contract for another term unless one side gives notice before a deadline.
Why it matters to a budget owner
Most software subscriptions renew automatically. The clause sets the length of each new term, the notice period, and often whether the price can change at renewal.
Auto-renewal is convenient for tools you keep and costly for tools you forgot. The risk is not the clause itself but not knowing when the notice deadline falls.
What to record
- The renewal term length
- The notice period and how to give notice
- Any price change allowed at renewal
Frequently asked questions
Can I cancel an auto-renewed contract after it renews?
Usually not without a termination right in the contract. Check for termination for convenience or a cancellation charge before assuming you are locked in.
General working knowledge about commercial contracts, not legal advice. Your own agreement governs.
Glossary
Look up related terms
- Notice deadlineThe notice deadline is the last day you can give notice to stop or change a renewal: the end date minus the notice period.
- Price uplift clauseA price uplift clause sets how much a vendor can raise the price at renewal, as a percentage cap, an index or a new list price.
- Evergreen contractAn evergreen contract has no end date. It runs until one side ends it, usually by giving notice.