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In the YouTube video tutorial, Simon from The Contract Company discusses how to terminate a contract. He emphasizes the importance of carefully examining the termination clause in the actual contract, which typically outlines a process that must be followed. This process often includes providing written notice within a specific time period, such as 30, 60, or 90 days, and sending the notice to a specified key person. Termination of a contract can be complex and risky if not done correctly.