Redlining is a collaborative process used to negotiate contracts by editing and marking up a draft to highlight changes, disagreements, or suggestions. Think of it as a "track changes" feature for contracts. Here's a simple breakdown of how redlining works and how you can approach it effectively:
Step 1: Review the Contract
Before making any changes, carefully read the contract to understand:
- The overall structure.
- Specific clauses or terms that might affect your business, like payment terms, liability, and intellectual property rights.
- Problematic or unclear language.
Step 2: Make Changes (Redline the Contract)
Redlining involves marking up the document draft to reflect proposed changes. This is typically done in a Word document and not in a PDF document. The process will involve your additions, deletions and comments or footnotes with clarifying questions or commentary to the proposed contract. Once you have made the changes to the document - you will redline your version of the document (typically by saving it as a new document, i.e. BLG Comments to Commercial Lease) and then using the "Compare" feature in Word, you will compare the version sent by the other party to your new version. This produces a new document showing the redline or the changes made from the initial contract/document. Save this new document as "Redline [Date] [Document Name].
Focus on Key Terms
For non-lawyers, it's essential to pay attention to:
- Liability Clauses: Make sure you're not accepting unfair risks.
- Payment Terms: Ensure they are clear and aligned with your expectations.
- Indemnification Clauses: Verify that they protect you appropriately.
- Deadlines and Deliverables: Confirm these are realistic and well-defined.
Step 3: Share and Collaborate
After redlining, send the revised contract back to the other party for review. They will likely:
- Accept some of your changes.
- Reject others.
- Propose their own edits.
This back-and-forth is normal and part of the negotiation process.
Step 4: Seek Mutual Agreement
The goal is to reach a fair compromise that satisfies both parties. Be willing to adjust, but don't shy away from insisting on clauses that are crucial for your protection.
Step 5: Finalize and Execute
Once all changes are agreed upon, the final contract is created, and both parties sign it.
Pro Tip for Non-Lawyers
Always seek professional legal advice if you're unsure about certain terms or clauses. While redlining is a collaborative process, it's also a critical moment to ensure you're not exposing yourself or your business to unnecessary risk.

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