© Copyright Envision SBS. 2007. All rights reserved.

Protected by the copyright laws of the United States & Canada and by international treaties. IT IS
ILLEGAL AND STRICTLY PROHIBITED TO DISTRIBUTE, PUBLISH, OFFER FOR SALE, LICENSE OR SUBLICENSE, GIVE OR DISCLOSE TO ANY
OTHER PARTY, THIS PRODUCT IN HARD COPY OR DIGITAL FORM. ALL OFFENDERS WILL BE SUED IN A COURT OF LAW.

CHECKLIST

FOR COMPLETE CONTRACTS TERMS

Note:
Not all items are relevant in all contractual situations. In some situations, other provisions may be
appropriate that are not listed below. The following checklist is, however, a basic and general guide
as to what provisions it may be important to include, or at least consider, in the business contracts
that are entered.

This checklist is not intended to substitute for legal advice nor legal wording provided by a legal
advisor in the relevant situations.

 Title of contract

 Identity of the parties

 Individuals or business entities

 If businesses, what type? (Partnership, corporation, LLC, etc.)
 Name of person signing on behalf of the business
 Signer’s official title
 Does he have authority to bind the business?

 Addresses of the parties

 Recitals

 Purpose(s) of the contract

 Background of agreement

 Interpretation (Back-to-Back)

 Underlying assumptions

Key assumptions for the contract

 Restrictions

Identifies any limitations in use of the supplied services and/or products (e.g., software can
only be installed and used by the buyer on one machine at any given time, with permission to
make one back-up copy).

 Exclusivity

 Effective date & term

 Calendar

 Documents’ Order of Precedence

o Modification of Agreement
o Contract Agreement
o Particular Conditions
© Copyright Envision SBS. 2007. All rights reserved. Protected by the copyright laws of the United States & Canada and by international treaties. IT IS
ILLEGAL AND STRICTLY PROHIBITED TO DISTRIBUTE, PUBLISH, OFFER FOR SALE, LICENSE OR SUBLICENSE, GIVE OR DISCLOSE TO ANY
OTHER PARTY, THIS PRODUCT IN HARD COPY OR DIGITAL FORM. ALL OFFENDERS WILL BE SUED IN A COURT OF LAW.

o General Conditions
o Specifications
o Drawings
o BOQ
o Schedule
o Proposal / Offer (Commercial & Technical)

Note: Above is subject to modification depending on the nature of the scope of work /
services.

 Scope of work / services

 Variation / Changes / Change Order Management

 Contract Amount / Price

 What is the price for the product or service?
 Is it a fixed price, determined by a formula, by a project fee, or some other manner?
 Terms & Conditions of Payment / Payment Procedure
 Payment Terms (advance & progress payments)
 Retention
 Bank Guarantee for Advance
 Performance Guarantee
 Lump sum, COD, instalments?
 Payment due dates
 Failure to pay
 Disputed invoices
 Mode of Payment
 Currency
 Currency Fluctuation
 Documentation
 Cost reimbursement
 Insurance (Contractors All Risk Insurance) and Workmen Compensation

 Extension of Time

 Obligations of Parties / Contract terms

 Duties of each party
 Rights of each party
 Relevant dates
 Relevant quantities
 How can the term be renewed or extended?
 Taxes
 Provision of warehousing / storage
 Handover of site;
 Security / Access to site;
 Quality Assurance / Health & Safety
© Copyright Envision SBS. 2007. All rights reserved. Protected by the copyright laws of the United States & Canada and by international treaties. IT IS
ILLEGAL AND STRICTLY PROHIBITED TO DISTRIBUTE, PUBLISH, OFFER FOR SALE, LICENSE OR SUBLICENSE, GIVE OR DISCLOSE TO ANY
OTHER PARTY, THIS PRODUCT IN HARD COPY OR DIGITAL FORM. ALL OFFENDERS WILL BE SUED IN A COURT OF LAW.

 Title of Goods - Transfer of Risks and Transfer of Ownership

 Testing, Commissioning & Inspection

 Acceptance / Approval of works (provisional & final) / Practical Completion / Handing

over / Project Close-out / Documentation

 Ownership of Intellectual Property

Outlines the ownership of copyright, patents, source code, executable code, documentation,
content and all other deliverables supplied under the contract.

 Representations Workmanship, Warranties and Defects Liability Period

 What representations and warranties are to be made by the parties?
 Are certain warranties disclaimed?
 How long are any warranties good for?
 Design Warranty
 Disclaimers

 Limitations on liability
 What limitations of liability exist (e.g., no liability in excess of payment received, or no
liability for consequential damage or lost profits)?
 Under what circumstances is one party liable (e.g., material breach of agreement or
grossly negligent in performing services)?

 Confidentiality provision

 What confidentiality obligations are there?

 What are the exclusions from confidentiality?

 Indemnity / Indemnification agreement

 Is there indemnification for certain breaches or problems?
 What is the procedure required to obtain indemnification?
 Is there a cap on or exclusions from indemnification?
 Project schedule

 Project Management

 Supervision / Consultant

 Performance Evaluation

 Liquidated damages

 Default

 What are the events of default?

 Does a party have a period to cure a default?
 What are the consequences of a default?

 Notice
© Copyright Envision SBS. 2007. All rights reserved. Protected by the copyright laws of the United States & Canada and by international treaties. IT IS
ILLEGAL AND STRICTLY PROHIBITED TO DISTRIBUTE, PUBLISH, OFFER FOR SALE, LICENSE OR SUBLICENSE, GIVE OR DISCLOSE TO ANY
OTHER PARTY, THIS PRODUCT IN HARD COPY OR DIGITAL FORM. ALL OFFENDERS WILL BE SUED IN A COURT OF LAW.

Describes how and where the parties shall formally communicate to each other in the event
they need to take such action (e.g., all notices shall be deemed to have been received by the
other party within five working days if sent by regular mail to the addresses below).

 Termination of Contract & Termination for Convenience

 When can one party terminate the contract early?
 What are the consequences of termination?
 What post-termination obligations are there?
 Assignment

Identifies if either party to the contract can transfer the contract, in whole, or in part, to another
party, and under what conditions (if any).

 Severability (Surviving Obligations)

Explains that if any of the provisions of the contract are rendered null and void, all other
provisions remain in force.

 Waiver

An assertion that any delay or partial pursuit by one party of its rights against the other party
does not constitute a forfeiture of the right to later seek further or complete remedy or redress
to a situation, should the need arise.

 Miscellaneous
 Interpretations
 Headings
 Definitions
 Modification of Agreement
 Time of the Essence
 Survival
 Force Majeure
 Ambiguities
 Execution
 Performances
 Representation on Authority of Parties
 Non-solicitation
 Relationship of Parties
 Trademark
 Advertising / Publicity / Marketing
 Spare parts obligation
 Exclusions
 Abortive Engineering Works
 Claims
 Conflict of Interest
 Non-competition
 Change of rates
 Anti-corruption
 Escalation
 Working Hours
© Copyright Envision SBS. 2007. All rights reserved. Protected by the copyright laws of the United States & Canada and by international treaties. IT IS
ILLEGAL AND STRICTLY PROHIBITED TO DISTRIBUTE, PUBLISH, OFFER FOR SALE, LICENSE OR SUBLICENSE, GIVE OR DISCLOSE TO ANY
OTHER PARTY, THIS PRODUCT IN HARD COPY OR DIGITAL FORM. ALL OFFENDERS WILL BE SUED IN A COURT OF LAW.

 Material Submittals and Approvals

 Import & Export Licenses
 Insolvency & Bankruptcy
 Ethics

 Statutory Requirements

 Governing Law

 Dispute Resolution

 Arbitration clause
 How are disputes to be handled – litigation, mediation, or arbitration?
 If arbitration, what rules will govern?
 If arbitration, how many arbitrators and how will they be picked?
 If arbitration, will there be procedures for discovery and what the arbitrator can and can’t
do?
 If litigation, where can or must the litigation be brought?
 Making a Subcontractor / Supplier responsible

 Entire Agreement

Explains that the written contract is the only description of the agreement between the vendor
and buyer, regardless of what may have been previously stated or written down. Explain the
process for updating the contract (often based upon mutual agreement in writing).

 Signatures of authorized signatories

 What authority is required for one party to sign the contract (e.g., Board of Directors
approval)?
 How many signatures are required?
 Are the signatures blocks correct?
 Company seal
 Witness(es)

IMPORTANT NOTE:
 COST SHEET;
 CASH FLOW TO BE PROVIDED;
 CONTRACTUAL RISKS ASSESSMENT TO BE PROVIDED BY THE CONCERNED;
 HEDGING;