Contracts Office

Contract Amendments and Renewals

Amendments

An amendment is an addition, deletion or change to a legal document and can only be accomplished by mutual agreement of all the parties. Once a contract is amended, the portions of the contract affected by the amendment are superseded and can no longer be given any force or effect. Amendments may be needed to add or delete work from the scope, extend the contract term, allow for additional time to complete the work, and reflect changes in requirements that arise due to events occurring after execution of the contract. In many cases, the vendor is not entitled to additional time or compensation for the extension of the period for performance unless the University is responsible for delays in the completion of performance. It is important to contact the Purchasing Department or the Contracts Office for review before proceeding with any discussion on an extension with a vendor.

Renewals

Contracts generally have a definite termination date and expire at the end of their term. Sometimes the parties want to extend or renew the term of the contract before its expiration date, so it is important that the term of any contract be definite or definitely determinable even when executing a renewal. Sometimes contracts contain options for renewal. Options for renewal should be clearly specified and must be by mutual agreement of the parties. Vendor contracts will often contain an automatic renewal or "evergreen" clause that will keep a contract on an indefinite renewal track unless specified events cause it not to renew (such as the university must give notice of nonrenewal within a narrow period of time right before the end of the then-current term). Automatic renewals are disfavored because they obligate the university to continuing performance under the contract when the market conditions may have changed or the needs of the department may have changed. Often the notice window to not renew the contract is missed by the department that wishes to terminate the contract. An option for renewal should be written to give the University, as the purchaser, the right but not the obligation to renew the contract for one or more additional terms.  If the department for some reason prefers that a contract renew without a formal renewal, the contract should include a provision requiring the other party to notify the department that the contract is about to renew and specifying the terms and conditions of the contract during the renewal period.



Contracts Office
Bracken Administration Building, room 208
2000 W. University Ave.
Muncie, IN 47306

Hours: Monday-Friday 8 a.m.-5 p.m.
Summer hours: 7:30 a.m.-4 p.m.
Phone: 765-285-1104
Fax: 765-285-3672