Contracts are like photographs that capture the details of\nan agreement at a specific point in time. However, circumstances change, and\neven a contract written with an eye to the future may need to be changed.\n\n\n\nAmending a contact must be done carefully. You want to\nchange the parts of the deal that are no longer working while preserving the\nparts of the deal that do work. \n\n\n\nWhen You Need a\nContract Amendment\n\n\n\nLegally, an amendment is a change\nto a contract after it has already been signed. Any changes to a document\nbefore it has been signed are known as modifications.\n\n\n\nYou may need a contract amendment when a handful of sections\nor clauses need to be changed. For an amendment to be enforceable, both sides\nhave to agree to the changes. \n\n\n\nIf the entire agreement needs to be altered, you are better\noff formally terminating the contract and executing a new deal. Every time you\namend a contract, you increase the chances of accidentally altering the\nagreement in unintended ways.\n\n\n\nCommon reasons parties amend contracts include changing\nmarket conditions, unexpected complications, or an evolution in the business\nrelationship between the two sides. \n\n\n\nDifference Between\nAmendments, Supplemental Agreement and Restated Agreements\n\n\n\nThere are many different legal terms that are related to amendments\nbut are separate legal concepts that are often confused with amendments.\n\n\n\nAn amendment to a contact means the original contract\nlanguage is changed in some way.\n\n\n\nA supplement is an additional document to the contract that\ndoes not change the original terms but does add new terms. \n\n\n\nA supplemental agreement is a legal document that memorializes the settling of a dispute as to the original terms of the contract. A supplemental agreement will describe the dispute and the settlement in an objective fashion.\n\n\n\nRestated agreements are the replacement of an entire\ncontract with an amendment. In most cases, restated agreements should be\navoided in favor of termination and execution of a new agreement. \n\n\n\nDon\u2019t Use the Quick\nand Dirty Method\n\n\n\nThe law gives the parties to a contract a lot of freedom to\namend the contract. This includes the quick and dirty method of crossing out\nterms and handwriting new terms on the face of the signed agreement. If both\nsides initial and date these markings, they are valid amendments. \n\n\n\nHowever, you should not use this quick and dirty method\nbecause it makes the contract harder to understand, and it can lead to misunderstandings,\ndisputes, and accusations of fraud. \n\n\n\nA better practice for contract amendments is to write out the changes and make reference to the specific provisions that are changed by the amendment. This is cleaner and leaves a paper trail should litigation be needed in the future. \n\n\n\nGet online in minutes, implement in hours, realize ROI in weeks! Easy-to-use, helps you increase productivity, contracts & revenue. Available anywhere, anytime & on any device.Try a Free Demo today! \n\n\n\nClearly State Reason\nfor Amendment\n\n\n\nYou need to clearly state the reason for the amendment. In\nthe heat of the moment, it may be obvious why certain changes are being made.\nBut, in the future, the reasons may be forgotten. Stating the reasons for any\nchanges will help keep both parties on the same page. \n\n\n\nIt can also help settle future disputes. Every contract and\namendment should be written with the idea that some stranger may need to read\nand understand the terms of the agreement. \n\n\n\nUse Detailed\nReferences\n\n\n\nWhen writing a contract amendment, you need to be detailed. You should state that clauses are being changed, where those clauses are located in the contract, and what changes are being made. \n\n\n\nIt is better to lean on the side of providing too much detail than not enough. \n\n\n\nExecute the Amendment\n\n\n\nFor an amendment to be enforceable, it must be executed.\nAuthorized representatives, preferably the same ones who signed the original\ncontract, need to sign and date the amendment. If the amendment is not signed\nby both sides, it isn\u2019t legally valid. \n\n\n\nDepending on the contract and the circumstances, it may be\ntechnically possible to orally amend a contract. But, this almost always leads\nto disputes and litigation. \n\n\n\nTake the time to execute a written amendment to the\ncontract. \n\n\n\nStore Amendment with\nOriginal Contract\n\n\n\nOnce the amendment has been executed, it is not a separate\nlegal document. It is part of the contract. You need to store the amendment\nwith the original contract in your contract management system. Most contract management\nsoftware makes this process easy.