Term and commitment shape
Fixed term vs evergreen contracts
A fixed-term agreement runs for a stated length and ends on a stated date. An evergreen agreement has no end date at all: it continues until one side terminates it, usually after a notice period. The practical difference is where your deadline lives. A fixed term gives you a date to work back from. An evergreen agreement gives you no date, which means nothing will ever prompt you to review it.
The Vendor Squeezer team. Last reviewed 2026-08-08. General guidance on contract structures, not legal advice, and not a statement about any particular vendor's terms.
How to tell which one you have
Look for a term clause, often titled Term, Duration, or Term and Termination. A fixed term states a length or an end date: twelve months from the effective date, or until a specific day. An evergreen agreement says something closer to continues in force until terminated in accordance with this clause.
Two things commonly confuse the reading. First, an agreement can have an initial fixed period and then become evergreen, which means it behaves as a fixed term once and as an evergreen agreement forever after. Second, a fixed term with an automatic renewal clause is not evergreen: it still has a term boundary, and that boundary is where your notice deadline sits.
What each shape means for your record
The common mistake is recording an evergreen agreement with an empty end date and then treating the blank as missing data. It is not missing. Continues until terminated is the answer, and writing it that way stops someone chasing a date that does not exist.
| Field | Fixed term | Evergreen |
|---|---|---|
| End date | The stated date | None. Record as continues until terminated |
| Notice deadline | Work back from the end date by the notice period | None fixed. Notice can be given at any time, effective after the notice period |
| Review trigger | The notice deadline | A review date you choose, because nothing in the agreement will prompt you |
| Minimum commitment | Usually the full term | Often an initial minimum period, then none |
Why evergreen agreements quietly get expensive
A fixed-term agreement forces a conversation at least once per term. An evergreen agreement never does. Nobody is negligent; there is simply no event that puts it in front of anyone, so it keeps billing at whatever was agreed when it started, for whatever seat count was right then.
The fix is not contractual, it is operational: set your own review date for every evergreen agreement, because the agreement will not set one for you. Annually is a reasonable default, and it is the only date on the record that came from you rather than from the vendor.
Questions to ask about your own agreement
- 1.Does the term clause state a length or an end date, or does it say the agreement continues until terminated?
- 2.If there is an initial fixed period, what happens at the end of it?
- 3.For an evergreen agreement, how much notice does termination require, and can either side give it?
- 4.Has anyone set a review date for this agreement, given nothing in it will prompt one?
Common questions
Is an evergreen contract worse than a fixed term?
Not inherently. Evergreen agreements are often easier to leave, because you can usually terminate at any time with notice rather than waiting for a term boundary. The risk is attention, not terms: nothing forces a review, so they drift.
Can an agreement be both?
Commonly, yes. An initial fixed period followed by continuation until terminated is a normal structure. Treat it as fixed until the initial period ends, then as evergreen with your own review date.
Put this against your own vendors
Record the term, the notice deadline, and the exit cost against the vendor once, and the next renewal review starts from an answer instead of a search. Free while in early access.