🔍 Deep Clause Inspection

AI Contract Clause Analyzer

Contracts are made of individual building blocks: clauses. ContractAI isolates and evaluates each clause to explain what it means, why it matters, and what red flags to avoid.

Analyze Every Clause in Your Contract

9 Major Clause Types Explained

1. Indemnification Clause

What it means: Requires one party to compensate the other for legal losses or damages.

Red Flag: One-sided indemnity covering indirect damages or third-party lawsuits regardless of fault.

2. Limitation of Liability

What it means: Caps the total financial damages a party can be held responsible for.

Red Flag: Missing caps or asymmetrical liability limits (e.g., vendor liability is capped at $500, but client liability is uncapped).

3. Termination for Convenience

What it means: Allows a party to end the agreement early without showing a breach.

Red Flag: Short notice windows (under 14 days) or non-refundable upfront deposit forfeitures.

4. Confidentiality & NDA

What it means: Protects proprietary business data, trade secrets, and customer lists.

Red Flag: Overly broad definitions of "Confidential Information" extending perpetually without exclusions.

5. Intellectual Property Assignment

What it means: Dictates who owns newly created designs, code, copy, or inventions.

Red Flag: Full IP assignment occurring prior to full invoice payment confirmation.

6. Non-Compete & Non-Solicit

What it means: Restricts working with competitors or soliciting employees/clients.

Red Flag: Excessively wide geographic radiuses or multi-year restrictions after contract end.

7. Mandatory Arbitration

What it means: Forces disputes into private arbitration instead of public court.

Red Flag: Arbitration located in a distant state with all administrative costs shifted to you.

8. Payment & Late Interest

What it means: Sets payment deadlines, currency terms, and late payment penalties.

Red Flag: Uncapped late compounding interest rates exceeding legal state limits.

9. Automatic Renewal

What it means: Extends contract term automatically unless advance cancellation notice is given.

Red Flag: Strict notice windows (e.g., exact 90-day window) leading to locked multi-year renewals.

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