The contract duration clause specifies the length of time for which the agreement remains in effect, outlining the start and end dates of the contractual obligations. It may also include provisions regarding renewal or termination options before the specified end date.
Average Contract Duration represents the dollar-weighted term, calculated on a billings basis, across all subscription and life-of-device contracts, using an assumed term of five years for life-of-device licenses, executed in the period.
The surrender charge amount per $1,000 varies based on the individual characteristics of the insureds, including issue age, sex, and underwriting classification, as well as Contract duration and the addition of optional riders. The maximum surrender charge amount per $1,000 applies in the first Contract Year to insureds age 52 and when both insureds are a smoker substandard class D or worse underwriting classification. The charge decreases to zero by the end of the 3rd year.
Contract duration (for example, short-term and long-term contracts): We also provide additional disclosures regarding contract duration, with the majority of our long-term contracts being development-related customer agreements reported in our Commercial Networks and Government Systems segments. See Note 1 – The Company and a Summary of Its Significant Accounting Policies – Revenue recognition – Disaggregation of revenue (page F-18).
Contract duration. The Company’s revenue contracts are typically short-term in nature. However, as noted above, our earnings releases and investor presentations highlight the percentage of revenue that is under longer-term contracts (as defined). We are proposing to update our disclosure to include information regarding our contract duration (Schedule 1 below).
Termination and Contract Duration While the mining pool cannot unilaterally terminate the contract, the Company does not believe this impacts the assessment of contact duration. In assessing the guidance in Example 2 of Question 7 of the FASB Q&A, the Company acknowledges that a contract endures as long as either party can terminate without penalty. This means that it is not necessary for both parties to the contract to have rights to terminate without penalty for it to be a substantive clause where Example 2 would be applicable. Based on the extract of the termination clause in the previous submission, while Hut 8 and USBTC may terminate their respective mining pool contracts at any time after settlement of pending transactions without penalty for either party upon termination of the contract, the contract duration cannot be shorter than a day as the settlement is generally on a daily basis.
Contract duration – All revenue contracts in the direct-to-consumer segment are short-term in nature.
Contract duration: Our contracts typically require delivery within one year. We consider substantially all of our contracts to be short term, such that disaggregating revenues by contract duration would not depict how revenues or cash flows are affected by economic factors.
Customer Contract Duration, Timing and Dayrates and Risks Associated with Operations. The duration and timing (including both starting and ending dates) of the customer contracts are estimates only, and customer contracts are subject to cancellation, suspension and delays for a variety of reasons, including some beyond the control of Transocean. Also, the dayrates set forth in the report are estimates based upon the full contractual operating dayrate. However, the actual average dayrate earned over the course of any given contract will be lower and could be substantially lower. The actual average dayrate will depend upon a number of factors (rig downtime, suspension of operations, etc.) including some beyond the control of Transocean. Our customer contracts and operations are generally subject to a number of risks and uncertainties, and we urge you to review the description and explanation of such risks and uncertainties in our filings with the Securities and Exchange Commission (SEC), which are available free of charge on the SEC’s website at www.sec.gov. The dayrates do not include revenue for mobilizations, demobilizations, upgrades, shipyards or recharges.
Contract duration refers to the period of time during which a contract is effective and the parties involved are obligated to meet the terms and conditions outlined within it. It specifies the start and end dates, and may also include provisions for extension or termination. The duration can vary widely depending on the nature and purpose of the agreement.
You should use contract duration in any legal agreement to clearly define the time frame for which the contract is operative. This is essential when:
Understanding and defining the duration ensures that all parties are aware of their obligations and can plan accordingly.
To write an effective contract duration:
Clearly specify the start and end dates: Use exact dates to prevent any confusion.
Example: “The contract shall commence on January 1, 2024, and terminate on December 31, 2024.”
Include provisions for extension (if applicable): Outline the procedure for extending the duration or criteria under which extension might occur.
Example: “This contract may be extended by mutual written agreement of the parties for an additional one-year term.”
Address early termination: Specify grounds for early termination and any penalties or conditions associated with it.
Example: “Either party may terminate this contract with a 30-day written notice under specific conditions as outlined in Section 5.”
Contract duration is a common feature in various types of contracts, including:
Employment Contracts: To define the length of employment, probationary periods, or contract work.
Lease Agreements: For specifying how long a tenant will occupy a property.
Service Agreements: To determine how long a service will be provided, which is critical for maintenance and consultancy contracts.
Sales Contracts: Particularly for offers or transactions with specified delivery dates.
Integrating contract duration into these agreements helps manage expectations and legal obligations for all parties involved.
Try our AI contract analysis and extract important clauses and information from existing contracts.
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Dive deeper into the world of clauses and learn more about these other clauses that are used in real contracts.
A "contract in force" clause specifies the period during which a contract is active and the terms are legally binding for both parties involved. It generally outlines the start and end dates of the agreement and conditions under which it remains valid or can be terminated.
Contract modification refers to the agreed-upon changes made to the terms or conditions of an existing contract by all involved parties. These modifications require mutual consent and can address various aspects, such as scope, pricing, or timelines, ensuring the contract remains relevant and effective.
A "Contract Year" is a defined term referring to a consecutive 12-month period starting on a specified date, often the effective date of a contract, and repeating annually throughout the contract's duration. It is used to structure time-based obligations, such as payments, performance milestones, or renewals, within the agreement.
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