Definitions Clause

Summary

These clauses on definitions provide examples of frequently defined terms found in commercial contracts. A definitions section immediately after the recitals makes the agreement easier to read and refer to. These clauses include practical guidance and drafting notes. Definitions of terms may be precise, enlarging or limiting. Precise definitions are drafted using the word "means" and give a word's exact definition. Enlarging definitions are drafted using the phrase "including but not limited to" after the definition, sometimes followed by illustrative examples. Limiting definitions are drafted using the phrase "but does not include" after the definition, followed by limitations of the definition. For a discussion of the rules of interpretation intended to provide guidelines to the parties, third parties and the courts as to how to interpret an agreement, see the practice note: Interpretation Clauses. See also the related clauses: Interpretation Clause, Background Checks and References ...