(a) Except as otherwise provided in subsection (b), on termination of a contract, all obligations that are still executory on both sides are discharged.

(b) The following Oobligations that survive termination of a contract include:

(1) a right or remedy based on prior breach of contract or completed performance;

(2) a contractual use restriction;limitation on the use, manner, method, or location of the exercise of rights in the information;

(3) an obligation of confidentiality or nondisclosure;

(4) an obligation to return, deliver or dispose of information, materials, documentation, copies, records, or the like to the other party or to obtain information from an escrow agent;

(5) a term establishing a choice of law or forum;

(6) an obligation to arbitrate or otherwise resolve contractual disputes by means of alternative dispute resolution procedures;

(7) a term limiting the time for commencing an action or for providing notice;

(8) an indemnity term pertaining to future claims;

(9) a limitation of remedy or disclaimer of warranty and a warranty that extends to future claims;

(10) an obligation to provide an accounting; and

(11) any right, remedy, or obligation stated in the agreement as surviving.

Uniform Law Source: Section 2A-505(2); Section 2-106(3).

a. Reviewed twice with no substantive changes.

1. Effect of Termination. Subsection (a) states the effect of termination, which refers to the discharge of executory obligations. Termination does not end vested rights or remedies. This rule corresponds to current law and to commercial practice..

2. Survival Rules. Subsection (b) provides a list of provisions and rights that survive termination. In most of the cases, the list presumes that the obligation was created in the contract. The list indicates terms that would ordinarily survive in a commercial contract. The intent is to provide background support, reducing the need for specification in the contract with resulting risk of error.

Of course, additional surviving terms can be added and the terms provided here can be made to be non-surviving. The contract terms can clearly add additional surviving obligations. The contract can also negate the survival of the listed rights. To do so, however, the contract would require specific reference and negation.