renewal term
Definition
A renewal term is the additional period of time a contract continues after the original agreement ends, usually under the same or similar conditions as the first contract. Many leases and service agreements automatically roll into a renewal term unless one party gives written notice that they want to stop.
Example
You sign a two-year office lease, and because you forget to send a 60-day notice before it expires, the contract automatically kicks into a one-year renewal term and you are locked in for another year.
Watch Out
Always calendar the deadline for canceling a contract before a renewal term kicks in, because missing that window can legally bind you to another full term whether you want it or not.
See which terms appear in your contract?
This definition is for informational purposes only and does not constitute legal advice. Please consult with a licensed attorney for legal guidance.