Contract review and certification methodology.
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Scope of the Reviews and Ratings
To compile this review and rating, our team carefully reviewed the primary document, as well as secondary documents that are incorporated by reference in the primary document.
Overview: Contract Review Methodology
TermScout was built on one core belief: data integrity and objectivity are everything in this business.
Our contract experts answer detailed and objective questions about what a contract does and does not say — it’s our superpower. We take incredible pride in ensuring that data is accurate, because we know just how important accuracy is throughout the process.
For every contract we review, we answer pre-determined questions. An objective and consistent rating algorithm is used to determine the approximate proportions of the contract that favor each party.
Our ratings and reviews are completed with a combination of AI and experienced contract professionals using proprietary methodology, technology, and templates. Reviews are done with the exact same variables used in every contract type, enabling us to create category data sets and comparisons with integrity.
Ratings are assigned objectively based on a predetermined list of attributes. The scoring algorithm is determined by a panel of expert attorneys experienced in the relevant fields and generally aligns with the WorldCC Contracting Principles — an independent third-party set of principles for creating balanced commercial contracts. Other factors, such as market prevalence, and additional market indicators can be interpreted loosely to mean the following:
- Customer Favorable: TermScout has deemed that the contract is more than 60% beneficial to the customer.
- Balanced: TermScout has deemed that the contract is no less than 40% beneficial to either party.
- Vendor Favorable: TermScout has deemed that the contract is more than 60% beneficial to the vendor.
Because contracts frequently contain vague, ambiguous, or otherwise unclear statements, we assign clarity levels to every finding. These can be used to help users understand TermScout’s general level of certainty on findings.
Get More Deals Done on Your Paper
Everyone prefers to work off their own paper, but a number of factors go into determining whose paper is best for a given transaction. TermScout’s Benchmark and Certify products offer a proven path to doing more deals on your paper with fewer redlines. Your team and their counterparties will thank you for it.
Reduce Contract Risk
Benchmark and Certify get more deals done on your paper, which is the best way to reduce contract risk. When you have to work on third-party paper, Triage filters out the riskiest contracts and makes sure they get the attention they need.
Drive More Revenue
TermScout helps sales teams close deals 3x faster by dramatically reducing friction in contract negotiations. Templates that are certified by TermScout are less likely to be heavily negotiated because we help your counterparties understand the benefits of signing on your terms. When dealing with third-party paper, Triage helps minimize escalations to legal by separating issues that fail and pass your legal department's pre-approved acceptance criteria.
The contract benchmarking process.
Benchmarking is intended to compare your terms or terms that you are reviewing against similar contracts in the market. You can choose the contracts to benchmark against or we can select them for you. See the Contract Review Methodology for a detailed explanation of how the contracts used in the benchmarking are reviewed.
In order to be certified by TermScout, a number of defined requirements must be met, including, a Balanced or better rating and no Deal-Breaker terms, as defined by TermScout. Certification is intended to provide you with an independent review and rating of your contract that you can include on your website to expedite the sales and negotiation process. See the Contract Review Methodology for a detailed explanation of how the contracts used in the benchmarking are reviewed.