What is an evergreen clause? (with examples)
An evergreen clause is language in a contract that causes it to renew automatically at the end of its term — for another month, quarter, or year — unless one of the parties gives notice to cancel within a specific window. It is the single most common reason SMBs end up paying for tools and services they no longer use.
The formal definition
An evergreen clause (also called an automatic renewal or perpetual renewal clause) provides that the contract shall continue for successive renewal terms of equal or specified length, unless either party gives written notice of non-renewal a fixed number of days before the end of the then-current term.
A typical example
"This Agreement shall commence on the Effective Date and continue for an initial term of twelve (12) months. Thereafter, this Agreement shall automatically renew for successive twelve (12) month terms unless either party provides written notice of non-renewal no less than sixty (60) days prior to the end of the then-current term." Miss that 60-day window and you are locked in for another year.
Where you'll find them
Evergreen clauses are standard in SaaS order forms, insurance policies, commercial leases, cleaning contracts, maintenance agreements, telecom contracts, and framework supplier agreements. They are legal in most jurisdictions, though several US states (notably California, New York, and Illinois) require the vendor to send a renewal notice.
How to manage them
Register every contract with a renewal date and a notice period. Calculate the last day you can cancel: renewal date minus notice period. Set reminders 90, 60, 30, 7 and 1 day before that date — not the renewal date itself. That is exactly what Kept is built to do.
Frequently asked
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