Contract Review

Contract Review

Review legal contracts for risks, extract key terms, and suggest redlines. Built on the CUAD dataset (41 risk categories), ContractEval benchmarks, and LegalBench. Disclaimer: This skill provides informational analysis only. It is not legal advice. Material terms should be reviewed by qualified legal counsel before signing.

When to Activate

User mentions "review contract", "analyze agreement", "check this contract" User uploads or references a PDF/DOCX legal document User asks about specific clauses, risks, or terms

Step 1: Pre-Review Checklist

Before analyzing content, verify document completeness: Blank fields: Flag any "$X", "TBD", "[amount]", "____" placeholders Missing exhibits: List all referenced schedules/exhibits and note which are missing Signature status: Draft or already executed? All pages present: Check for truncation or missing sections If blank fields or missing exhibits exist, flag prominently in output header.

Step 2: Identify Document Type & User Position

Ask if unclear: "Which party are you? (customer, vendor, buyer, seller, licensor, licensee, receiving party, disclosing party)" This affects what's "risky": Customer reviewing vendor agreement: flag vendor-favorable terms Vendor reviewing own template: flag customer-favorable terms Buyer in M&A: flag seller-favorable terms Seller in M&A: flag buyer-favorable terms Receiving party in NDA: flag disclosing party-favorable terms Assess power dynamic: Startup vs. large enterprise? (limited negotiating leverage) Standard form vs. negotiated? (some terms non-negotiable) Regulated industry? (some terms legally required)

Output Format

Use markdown for readable, scannable output.

Example Output

• # Contract Review: [Document Name]
• **Document Type:** SaaS Subscription Agreement
• **Your Position:** Customer
• **Counterparty:** Acme Software Inc.
• **Risk Level:** Medium
• **Document Status:** Draft / Executed on [date]
• ## Pre-Signing Alerts
• **Blank field:** Fee amount in Section 4.1 is "$____"
• **Missing exhibit:** Exhibit B (SLA) referenced but not attached
• ## Executive Summary
• Standard vendor agreement with some one-sided terms. The 3-month liability cap and
• asymmetric termination rights need attention. Data ownership is clear.
• ---
• ## Key Terms
• | Term | Value | Location |
• |------|-------|----------|
• | Initial Term | 12 months | Section 8.1 |
• | Auto-Renewal | 12-month periods, 60-day notice | Section 8.2 |
• | Liability Cap | 3 months' fees | Section 10.2 |
• | Governing Law | Delaware | Section 12.1 |
• ---
• ## Red Flags (Quick Scan)
• | Flag | Found | Location |
• |------|-------|----------|
• | Liability cap < 6 months | Yes | Section 10.2 |
• | Uncapped indemnification | No | -- |
• | Unilateral amendment rights | Yes | Section 14.1 |
• | No termination for convenience | No | -- |
• | Perpetual obligations | No | -- |
• | Offshore jurisdiction | No | -- |
• ---
• ## Risk Analysis
• ### Critical
• **Limitation of Liability** (Section 10.2)
• > "Liability shall not exceed fees paid in the preceding three (3) months"
• **Issue:** 3-month cap is below market standard (typically 12 months)
• **Risk:** For $120K annual contract, liability capped at $30K
• **Market Standard:** 12 months' fees
• **Negotiability:** Medium -- most vendors accept 6-12 months
• **Redline:** Change "three (3) months" to "twelve (12) months"
• **Fallback:** Accept 6 months as compromise
• ---
• ### Important
• **Termination for Convenience** (Section 8.5)
• > "Vendor may terminate for any reason upon 30 days notice"
• **Issue:** One-sided; customer lacks equivalent right
• **Market Standard:** Mutual termination rights
• **Negotiability:** High -- reasonable ask
• **Redline:** Add "Either party may terminate..." or change to "90 days"
• ---
• ### Reviewed & Acceptable
• | Category | Status | Notes |
• |----------|--------|-------|
• | Data Ownership | OK | Customer owns all customer data |
• | IP Rights | OK | Clear separation, no broad assignment |
• | Confidentiality | OK | Mutual, 3-year term, standard exceptions |
• | Governing Law | OK | Delaware -- neutral for commercial |
• ---
• ## Missing Provisions
• | Provision | Priority | Why It Matters |
• |-----------|----------|----------------|
• | Data Export Rights | Critical | No guaranteed way to get data out on termination |
• | SLA Credits | Important | 99.9% uptime stated but no remedy for breach |
• | Price Increase Cap | Important | Renewal pricing uncapped |
• **Suggested language for Data Export:**
• > "Upon termination, Vendor shall make Customer Data available for export in CSV or JSON format for 90 days at no additional charge."
• ---
• ## Internal Consistency Issues
• Section 5.2 references "Exhibit C" but no Exhibit C exists
• "Confidential Information" defined in Section 3.1 but used lowercase in Section 7
• ---
• ## Negotiation Priority
• | # | Issue | Ask | Negotiability |
• |---|-------|-----|---------------|
• | 1 | Liability cap | 12 months | Medium |
• | 2 | Termination rights | Mutual | High |
• | 3 | Data export | Add provision | High |
• | 4 | Price cap | 5% annual max | Medium |
• ---
• *This review is for informational purposes only. Material terms should be reviewed by qualified legal counsel.*

Red Flags Quick Scan

Check these danger signs FIRST before deep analysis: Red FlagWhy It MattersLiability cap < 6 monthsInadequate protectionUncapped indemnificationUnlimited exposure"As-is" with no warrantyNo recourse for defectsUnilateral suspension without noticeService can vanishUnilateral amendment rightsTerms can changeNo termination for convenienceLocked inPerpetual obligations (tails, non-competes)Indefinite exposureOffshore jurisdiction (BVI, Cayman)Expensive to enforcePre-signed conflict waiversNo recourse for conflicts"Sole discretion" language favoring counterpartyNo objective standardClass action waiver + mandatory arbitrationLimited remediesAsymmetric assignment rightsThey can assign, you can't

NDA Checklist

CategoryCheck ForDirectionOne-way or mutual?Definition scope"All information" too broad? Standard exceptions?Term2 years short, 3-5 typical, indefinite for trade secretsPermitted disclosure"Representatives" defined? Flow-down required?Residuals clauseCan use general knowledge retained in memory?Non-solicitationEmployees protected?StandstillPrevents hostile acquisition actions?No-contactCustomers, suppliers, employees protected?Return/destructionCertification required?Public announcementProhibits disclosure of discussions?Compelled disclosureNotice required? Time to seek protective order?Injunctive reliefPre-agreed specific performance? Bond waiver?

SaaS/MSA Checklist

CategoryCheck ForLiability cap12+ months = standardUptime SLA99.9% with credits = standardSuspension rightsUnilateral? Notice required?Data ownershipCustomer owns customer data?Data exportFormat, duration, cost on termination?Price increasesCapped? Notice period?Auto-renewal notice90+ days = good, <60 = riskTerminationMutual for convenience? Cure period for cause?SubprocessorsNotice of changes? Approval rights?InsuranceVendor carries E&O, cyber?

Payment/Merchant Agreement Checklist

CategoryCheck ForReserve/holdbackAmount, duration, release conditions?Chargeback liabilityCapped? Fraud protection?Network rulesIncorporated by reference? Access provided?Auto-debit authorityNotice before debits?Settlement timingWhen do you receive funds?Volume commitmentsRealistic? Penalty for shortfall?Suspension rightsImmediate or notice?Termination tailHow long do obligations survive?Audit rightsFrequency, notice, cost allocation?PCI complianceWho bears cost?

M&A Agreement Checklist

CategoryCheck ForPurchase priceCash vs. stock vs. earnout mix?Earnout mechanicsMeasurement, discretion, audit rights, acceleration?Escrow/holdbackAmount (10-15% typical), duration (12-18 mo), release?Rep survival12-24 months general, longer for fundamentalIndemnification cap10-20% of purchase price typicalBasket typeTrue deductible vs. tipping?SandbaggingPro-buyer or anti-sandbagging?Non-compete2-3 years, geographic scope?Working capitalTarget, collar, true-up mechanism?MAC definitionCarve-outs for market conditions?Employment compCounted in purchase price or separate?

Finder/Broker Agreement Checklist

CategoryCheck ForFee percentageSpecified or blank?Fee calculationWhat's included in deal value? Employment comp?"Covered buyer" definitionHow broad? Any prior relationship carve-out?Tail period12-24 months typical; perpetual = red flagExclusivityExclusive or non-exclusive?Minimum feeFloor amount?Joint representationConsent required? Conflict waiver?Escrow deductionAuto-pay from proceeds?Term/terminationCan you exit?Broker statusBD registered if securities involved?

Document Basics

Document Name and Type Parties (legal names, roles) Agreement Date / Effective Date Expiration Date Renewal Terms Document Status (draft/executed) Blank Fields / Placeholders

Term & Termination

Contract Term / Duration Termination for Convenience Termination for Cause Post-Termination Services Survival Clauses Suspension Rights (immediate vs. with notice) Cure Periods

Assignment & Control

Anti-Assignment Clause Change of Control Consent Requirements Asymmetric Assignment (they can, you can't)

Financial Terms

Payment Terms Price Restrictions / Adjustments Most Favored Nation (MFN) Minimum Commitment Volume Restrictions Audit Rights Price Escalation Caps Reserve/Holdback Requirements Auto-Debit Authority

Liability & Risk

Limitation of Liability Cap on Liability Uncapped Liability Carve-outs Indemnification Insurance Requirements Warranty Duration Warranty Disclaimer (As-Is) Exclusive Remedy Clauses Chargeback/Return Liability

IP & Confidentiality

IP Ownership Assignment License Grant Affiliate License - Licensor/Licensee Covenant Not To Sue Non-Compete Non-Solicitation (Employees/Customers) Competitive Restriction Exception Exclusivity Non-Disparagement Confidentiality Duration Third Party Beneficiary Residuals Clause Feedback Ownership

Dispute Resolution

Governing Law Jurisdiction / Venue Arbitration vs Litigation Jury Trial Waiver Class Action Waiver Offshore Jurisdiction Flags

Special Provisions

ROFR / ROFO / ROFN Revenue/Profit Sharing Joint IP Ownership Source Code Escrow Irrevocable or Perpetual License Data Export Rights Uptime/Availability SLA Sublicensing Rights Unilateral Amendment Rights

Market Standard Benchmarks

ProvisionStandardYellow FlagRed FlagLiability cap12 months' fees6-11 months<6 monthsNon-compete duration1-2 years3-4 years5+ yearsNon-compete geographyWhere business operatesState-wideNationwideAuto-renewal notice90+ days60-89 days<60 daysTermination noticeMutual, 60-90 daysOne-sided, 30 daysImmediateIndemnificationMutual, cappedAsymmetricUncappedRep survival (M&A)12-18 months general24-30 months36+ monthsEscrow (M&A)10-15% for 12-18 mo15-20% for 18-24 mo>20% or >24 moConfidentiality (NDA)3 years general2 years5+ yearsFee tail (broker)12-18 months24 monthsPerpetualSLA uptime99.9% with credits99.5%No SLAData export90 days, standard format30 daysNonePrice increase capCPI or 5% annual10% annualUncappedCure period30 days15 daysNone

Negotiability Guide

RatingMeaningExamplesHighUsually acceptedMutual termination, cure periods, data exportMediumDepends on leverageLiability cap increase, price capsLowRarely changedNetwork rules (payments), regulatory requirementsNoneNon-negotiableCard network mandates, banking regulations Power dynamic factors: Large customer + small vendor = more leverage Startup + enterprise vendor = less leverage Competitive market = more leverage Sole-source vendor = less leverage Regulated terms = no leverage (legally required)

Jurisdiction Notes

Non-Competes: California, North Dakota, Oklahoma, Minnesota: Generally void Other states: Reasonableness test applies Choice of Law: Delaware: Corp-friendly, predictable New York: Financial agreements, sophisticated courts California: Employee-friendly, tech industry BVI/Cayman: Offshore, expensive to litigate, potential red flag Arbitration Venues: AAA, JAMS: Standard US commercial SIAC (Singapore), LCIA (London): International, expensive Mandatory + class waiver: Limits remedies significantly

Guardrails

Not legal advice: Recommend attorney review for material terms Not tax advice: Flag but don't opine Jurisdiction matters: Note when enforceability varies Express uncertainty: Say when interpretation is unclear No hallucination: Only reference text actually in document Show what's acceptable: Always include "Reviewed & Acceptable" section Document status matters: Note if already executed (review is informational)

License

MIT License. Open source contribution by IrisGo.AI.