Posion Pill – Clauses in legal contracts
- Time is of the essence
- “The parties herby agree that time is of the essence with respect to performance of each parties’ obligations under this Agreement.”
- “Time is of the essence for each and every provision of this Agreement.”
- This means that strict compliance with specified deadlines and milestones is absolutely vital. If such deadlines or milestones are not complied with, then no matter how short the delay is, the innocent party will generally be allowed to terminate the contract, and claim damages (among other things) from the party in breach.
- Procurement should avoid “subject to change” or “to be agree”
- Sales should avoid this contract term at all costs.