What Is a Master Service Agreement for Software Development?
It describes the terms on which the developer sells and transfers customized software to the client for their own use in software, processes, or services.3 min read
2. Client Responsibilities
3. Software Acceptance
5. Terms and Terminations
7. Limitation of Liability
Updated November 24, 2020:
The master service agreement for software development, also known as the software development agreement, describes the terms on which the developer sells and transfers customized software to the client for their own use in software, processes, or services. Scope of work is added to the agreement to describe what kind of software is going to be developed.
The developer is in the computer application development business and has specialized expertise in creating and testing software used in web and mobile applications. The client wants the developer to create unique software specifically for the client, and the developer accepts the terms and conditions specified in the contract.
Scope of Contract
- Scope of Engagement: The client retains the services of the developer to create, develop, and implement the software according to the specifications of the client and in the time allotted. The developer can use employees and contractors to design and implement software. The client will work with the developer with requests and information needed to finish the work.
- Developer Duties and Responsibilities: Both parties will define the specifications and the developer will do the work according to specifications and make an effort to deliver the software at the specified deadline. There should also be a project manager assigned to be responsible for everyday activities.
- Changes to Scope: If the client wants to change the work, the client has to give the developer a detailed proposal that specifies the changes. The developer will respond with changes in fees and within a certain amount of days. The client will look over developer change and agree, reject, or make other modifications. If changes are agreed to, an addendum can be added to the contract.
The client agrees to follow the terms in the contract and to give the developer support to complete the work. The client is responsible for the fees of any changes in the software, systems, and hardware.
The client will allow for there to be enough people for testing software and prepare the data from the test.
Both parties should work together to make an acceptance test to verify the software meets the requirements of the specification.
- Acceptance Time: The client will have a certain amount of days after delivery of software to inspect, test, and look over the software to see if it meets standards.
- Approval: If the client approves the acceptance test, the client will give the developer a written notice. The acceptance test is also thought to be approved if the client puts the software into operation.
- Rejection: If the client doesn't approve the acceptance test, the reason will be explained in writing. If the developer doesn't accept the rejection, this will also be explained in writing. If not, the developer has several days to repair errors.
The client will pay the developer a fixed fee for the work according to a payment described in a section of the contract. The developer will obtain client approval for travel, and the client will pay for commercial software libraries.
Developer's invoices for expenses and fees are due and payable upon receipt by the client. Invoices not paid will have an interest charged per day or maximum allowed by law. The developer can suspend work until payments are made.
Terms and Terminations
The agreement starts on the effective date and will continue until complete payment for the work is received by the developer.
Each party can end the agreement when there's a breach by the other or if one or more terms are not followed, even after a notice.
Information that relates to the client is known as confidential or proprietary and will be held in confidence by the developer. This is also true for the client, who has to keep developer information confidential.
These confidentiality obligations will continue for several years as agreed upon in the contract.
Limitation of Liability
Both parties are not liable to the other for indirect, consequential, or special incidental damages arising as a result of the work. To the extent allowed by the law, the client will hold the developer responsible for claims incurred by the developer arising from the client's breach of contract, along with attorney fees and expenses.
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