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Auto-Renewal Clause

A contractual provision that extends a contract for another term automatically unless a party gives notice of non-renewal before a set deadline.

Reviewed by GC AI Solutions Team•Updated September 2026

Definition

An auto-renewal clause, also called an automatic renewal or evergreen clause, extends a contract for one or more additional terms automatically when the current term ends, unless a party gives written notice of non-renewal before a stated deadline. The renewal term, the notice window, and any price change on renewal are set by the contract. The clause keeps a relationship running without a new signature, and it puts the burden on the party that wants out to act before the deadline.

What It Does

For in-house counsel, the renewal review needs to happen early enough for the business to decide whether to continue. A practical test: identify the next non-renewal deadline, the required delivery method, the person responsible for notice, the length and price of the renewal term, and any available termination right.

  • Extends the contract for one or more renewal terms automatically when the current term ends

  • Sets the notice window, the deadline before expiration by which a party must give notice of non-renewal

  • Defines who may decline renewal, one party or both

  • Governs whether fees stay flat or increase on each renewal

  • Requires the party seeking non-renewal to act before the contractual deadline, subject to applicable law and any other termination rights.

The examples below include 30-day, 90-day, six-month, and 180-day non-renewal notice periods.

When You'll See It

Auto-renewal clauses run through almost every recurring commercial relationship: SaaS and subscription agreements, software licenses, maintenance and support contracts, managed-services agreements, equipment leases, and supply agreements. They sit in the term-and-termination section, paired with the notices provision that controls how non-renewal has to be delivered. The drafting varies most in SaaS and long-term services, where the vendor wants a long notice window and a built-in price increase, and the customer wants a short window and a flat renewal rate.

Renewal deserves close attention where the spend is large or switching costs are high. A missed deadline can lead to another term at the contract's renewal rate, subject to applicable law and any available termination rights. Track the non-renewal deadline, required reminders, renewal pricing, and exit rights together.

Examples

GRIID Infrastructure Inc. / CleanSpark, Inc.

Colocation Mining Services AgreementCustomer-only non-renewal noticeOne-Sided2024
"The Term shall automatically renew for the Renewal Terms set forth in the Cover Page, unless Customer gives Service Provider written notice of non-renewal at least thirty (30) days prior to the end of the then-current Term."
Source

Precision Pathology Laboratory Services, LLC / Village Oaks Pathology Services, P.A.

Professional Services Agreement30-day non-renewal noticeMutual2023
"The term of this Agreement will extend automatically for successive periods of twelve (12) months each, unless either party gives written notice of non-renewal at least thirty (30) days' prior to the end of any such twelve-month period."
Source

ValidClick, Inc. / Yahoo Holdings Inc.

Amendment #32 to the Yahoo Publisher Network Contract90-day non-renewal noticeMutual2023
"Thereafter, the Term will automatically renew for additional one (1) year periods unless either party gives notice of non-renewal at least ninety (90) days before the expiration of the then-current Term."
Source

Streamline Health Solutions, Inc. / 180 Consulting, Inc.

Amended and Restated Master Services and Non-Disclosure AgreementSix-month non-renewal noticeMutual2025
"Following the Initial Term, the term of this Agreement will automatically renew for successive periods of twelve (12) months (each, a 'Renewal Term'), unless (a) Company provides written notice to Consultant that it does not desire to extend the term of this Agreement at least six (6) months prior to the expiration of Initial Term, or (b) following the Initial Term, either party hereto provides written notice to the other party that it does not desire to extend the term of this Agreement at least six (6) months prior to the expiration of the then-current Renewal Term."
Source

Near North America Inc. / MobileFuse, LLC

Platform Usage Agreement180-day non-renewal noticeMutual2023
"The T&C's will automatically renew for successive periods of 1 (one) year each ('Renewal Term') unless either party provides the other party with written notice of at least 180 (one-hundred and eighty) days' prior to the expiry of the Initial Term or subsequent Renewal Term, that this Agreement shall not be renewed."
Source

Negotiate

Customer Positions:

Seek a manageable notice deadline, predictable renewal pricing, and an exit right that fits the business.

  • Negotiate a 30-day non-renewal notice window so the business can decide closer to expiration. Negotiate the renewal term separately; the notice window does not determine its length.
  • Add a reminder obligation requiring the vendor to notify you 30 to 60 days before the non-renewal deadline.
  • Cap any renewal price increase, or hold the rate flat for the first renewal term.
  • Convert a long, multi-year auto-renewal into a month-to-month rollover after the initial term.
  • Keep a termination-for-convenience right that carries into the renewal terms.

Vendor Positions:

Seek enough notice to plan capacity and revenue, with clear rules for renewal pricing and delivery of notice.

  • Negotiate a non-renewal notice window that supports capacity planning and renewal forecasting, subject to applicable law.
  • Tie renewal pricing to your then-current rates or a stated annual increase.
  • Require non-renewal notice in writing through the formal notices provision rather than by email to a sales rep.
  • Make the renewal term match the initial term, so the relationship resets on the same footing.
  • Confirm that renewal carries forward the full agreement, including any minimum commitments.

Put each non-renewal deadline on a docket when you sign, together with the required notice method and the person responsible for sending it.

Red Flags

  • A non-renewal notice window so long, 90 days or more, that the deadline passes before most teams revisit the contract.

  • An automatic price increase on renewal with no cap, so each term costs more than the last.

  • A renewal term longer than the initial term, creating a longer commitment if renewal takes effect and no other exit right applies.

  • Non-renewal notice required by certified mail or a method designed to be easy to miss.

  • A one-sided clause where only the vendor can decline renewal, leaving you bound while they stay free.

Auto-Renewal Clause FAQs

What is an auto-renewal clause?
An auto-renewal clause extends a contract for another term automatically when the current term ends, unless a party gives written notice of non-renewal before a stated deadline. It keeps the relationship running without a new signature.
What is the difference between an auto-renewal clause and an evergreen clause?
They describe the same mechanism. An evergreen clause is an auto-renewal clause that rolls over indefinitely, term after term, until one party gives notice to stop, rather than renewing for a fixed number of terms.
How much notice do you need to cancel an auto-renewing contract?
Check the contractual notice window and delivery method. The examples here include 30-day, 90-day, six-month, and 180-day periods. Missing the deadline may trigger renewal, subject to applicable law, required notices, and any termination rights.
Are auto-renewal clauses enforceable?
Enforceability depends on the agreement and applicable law. Consumer renewals may be subject to state requirements, and the federal Restore Online Shoppers' Confidence Act governs covered online negative-option transactions. New York General Obligations Law section 5-903 also reaches qualifying business contracts for service, maintenance, or repair to or for property. For covered renewals longer than one month, it requires the provider to give a written reminder, personally or by certified mail, 15 to 30 days before the customer's non-renewal notice deadline.
How do you get out of an auto-renewal clause?
Give written notice of non-renewal through the method the contract requires, before the notice deadline. The safest practice is to docket every renewal date when you sign and to send non-renewal notice through the formal notices provision.
Can a vendor raise prices when a contract auto-renews?
A vendor may raise renewal prices if the agreement permits the increase and applicable legal requirements are met. Check whether the clause uses then-current rates or a stated increase, requires advance notice, and gives the customer an opportunity to decline renewal. A customer can negotiate a cap or a flat rate for a specified renewal term.

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This content is for informational purposes only and does not constitute legal advice.