Breaking Up is Hard to Do - Part II

So what should you think about including in the exit clause? You'll probably want to ask yourself a few questions...

• What circumstances should trigger either party invoking the exit clause? What would need to happen for your company to want out?
• What kind of notice should each party be required to give?
• What about Intellectual Property (IP) - what happens to any jointly developed assets?
• How will customer support be handled in the event of a breakup of the alliance? (typically covered in a "wind down" clause).
• Should there be any penalties for termination (or contract breaches)?

Think about the worse case scenario and what you would want to see happen, especially as it relates to any joint customers or prospects. Having this discussion during the initial contract negotiations is sure to save you potential headaches in the event that things don't work out the way everyone planned...