Evergreen

What is 'Evergreen'

Evergreen is a contract provision that automatically renews the length of the agreement after a predetermined period, unless notice for termination is given. Evergreens are often used for long term agreements such as memberships or maintenance contracts.

BREAKING DOWN 'Evergreen'

An evergreen is renewed after a short period, which is agreed upon by the parties at the outset of the contract. Let's use a year-long evergreen contract with a monthly renewal as an example. This contract will last one year from the beginning month. After the first month, if no termination notice is given, then contract will extend to last a year from that period and so on. Once termination is given, the contract would live out the rest the year and not be renewed again.

RELATED TERMS
  1. Evergreen Option

    A type of employee stock option plan in which additional shares ...
  2. Evergreen Loan

    A loan that does not require the principal amount to be paid ...
  3. Continuous Contract

    A reinsurance contract that does not have a fixed contract end ...
  4. Evergreen Funding

    1. A British term that describes a revolving credit arrangement ...
  5. Assignable Contract

    A futures contract with a provision permitting the contract holder ...
  6. Cash Contract

    A financial arrangement that requires delivery of a particular ...
Related Articles
  1. Trading

    The Difference Between Forwards and Futures

    Both forward and futures contracts allow investors to buy or sell an asset at a specific time and price.
  2. Financial Advisor

    Divorce and Annuities: What Clients Need to Know

    Divorce can be the most financially devastating event in a person’s life. Here’s what your clients need to know about handling annuities in a divorce case.
  3. Financial Advisor

    How Do Futures Contracts Work?

    Futures contracts are one of the most important financial innovations in history, but they are often misunderstood. Find out this contract is used to transfer risk between different parties. ...
  4. Investing

    What is a Forward Contract?

    A forward contract is a customized contract between two parties to buy or sell an asset at a specified price on a future date.
  5. Markets

    How to Trade Futures Contracts

    Futures is short for Futures Contracts, which are contracts between a buyer and seller of an asset who agree to exchange goods and money at a future date, but at a price and quantity determined ...
  6. Investing

    Options on Futures

    Options on futures contracts offer another way for day traders to use options. These are traded on the same exchange as the underlying futures contract. Traders should take care to understand ...
  7. Markets

    Global Transportation: 3 Key Industry Players (BRK-A, AAL)

    Get information on some of the leading publicly-traded companies worldwide that are major players in the transportation industry.
  8. Trading

    Why Forward Contracts Are The Foundation Of All Derivatives

    This article expands on the complex structure of derivatives by explaining how an investor can assess interest rate parity and implement covered interest arbitrage by using a currency forward ...
  9. Investing

    Why Do Some Failed Mergers Result in Break-Up Fees?

    When mergers go bad, there's often a break-up fee involved of as high as 3-5% of the value of the proposed merger.
  10. Investing

    What is Terminal Value?

    The terminal value of an asset is its anticipated value on a certain date in the future.
RELATED FAQS
  1. What is evergreen funding?

    Evergreen funding is a term used to describe the incremental addition of money into a business. Before a business is started ... Read Answer >>
  2. What is an evergreen provision and how does it affect shareholders?

    It is common for publicly-traded corporations to provide more than just regular salary compensation to their management and ... Read Answer >>
  3. How can an investor terminate a derivative contract?

    Read a brief overview about some of the different ways that derivatives traders can terminate their contracts early, including ... Read Answer >>
  4. What is the difference between forward and futures contracts?

    Fundamentally, forward and futures contracts have the same function: both types of contracts allow people to buy or sell ... Read Answer >>
  5. How can a futures trader exit a position prior to expiration?

    A futures contract is an agreement to buy or sell a commodity at a pre-determined price and quantity at a future date in ... Read Answer >>
  6. What does a futures contract cost?

    Learn about values of futures contracts and the initial margin a trader must place in an account to open a futures position, ... Read Answer >>
Trading Center