What Is an Auto-Renewal (Evergreen) Clause?
An auto-renewal clause — sometimes called an evergreen clause — automatically extends a contract for another term unless one party gives notice of non-renewal within a set window, such as 30 or 60 days before the end date. Miss the window, and you're bound for a new term whether you wanted it or not.
Why it matters
Auto-renewal converts your silence into a commitment. It's common in service agreements, software subscriptions, and leases — and the notice window is often placed months before the renewal date, when nobody is thinking about the contract. For businesses, a missed window can mean paying another full year for a service you meant to drop.
What to watch for
- Long renewal terms: auto-renewing for another full year (rather than month-to-month) raises the stakes of a missed window.
- Narrow or early notice windows: a 30-day window that closes 90 days before the end date is easy to miss.
- Notice formalities: some clauses require written notice by a specific method; an email may not count.
- Price changes on renewal: some clauses allow the renewed term to carry a new, higher rate.
A realistic example
A studio signs a 12-month tools subscription with auto-renewal requiring cancellation notice 60 days before term end. In month 10, they decide to switch vendors — but the window closed at the end of month 10's first week. The subscription renews for another year at an increased rate the clause permitted.
What to ask for
- Renewal by agreement, not by silence — the term ends unless both parties renew.
- If auto-renewal stays: a 30+ day exit window near the end date, plus a requirement that the vendor send a renewal reminder before the window closes.
- Month-to-month after the first term, so a missed window costs weeks, not a year.
Related terms: termination for convenience · net 30 Related guide: What to negotiate before you sign
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Not legal advice. This is an educational definition of a common contract term. Details vary by jurisdiction — this page explains common U.S. usage. For high-stakes agreements, have a lawyer review the final version.