What is the definition of a performance contract? A performance contract is a legally binding agreement between two parties, which outlines the specific duties and responsibilities of each in order to ensure the successful completion of a project, event, or performance. It is important to note that performance contracts are typically only used when one party is providing a service to another, as opposed to a contract for the sale of goods or services. The agreement should clearly outline the scope of the project or performance, the specific terms and conditions that must be met by both parties, and the compensation that will be awarded to the performer. It should also include any additional terms and conditions that must be met or agreed upon by both parties. The performance contract should be signed by both parties in order to become legally binding, and any changes or modifications should be discussed, negotiated, and agreed upon before being put into effect. Ultimately, the performance contract serves to protect both parties and ensure that each is held accountable for any commitments they may make or