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Master Services Agreement (MSA)

A professional starting-point template for ongoing service relationships. Covers scope, fees, service levels, IP ownership, liability caps, termination, and change order process.

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Master Services Agreement (MSA)

This Master Services Agreement ("Agreement") is entered into as of [DATE] ("Effective Date") by and between:

Client: [CLIENT NAME], a [STATE] [ENTITY TYPE] with its principal place of business at [CLIENT ADDRESS] ("Client")

Service Provider: [PROVIDER NAME], a [STATE] [ENTITY TYPE] with its principal place of business at [PROVIDER ADDRESS] ("Provider")

(Each a "Party" and collectively the "Parties").


1. Services & Statements of Work

Scope: Provider shall perform services as described in one or more Statements of Work ("SOWs") executed by both Parties. Each SOW shall reference this Agreement and incorporate its terms.

SOW Contents: Each SOW shall specify: - Detailed description of Services - Deliverables and acceptance criteria - Timeline and milestones - Fees and payment schedule - Service Level Agreement (SLA) if applicable - Project-specific assumptions and dependencies

Priority: In case of conflict between this Agreement and an SOW, the SOW governs for that specific engagement.


2. Term

Agreement Term: [INITIAL TERM, e.g., 12 months] from Effective Date, auto-renewing for successive [RENEWAL TERM] periods unless either Party provides written notice of non-renewal [NOTICE PERIOD, e.g., 30] days before expiration.

SOW Term: Each SOW has its own term as specified therein. SOWs survive Agreement expiration/termination until completed or separately terminated.


3. Fees & Payment

Fee Structure: As specified in each SOW. May include: - Time & Materials (rate card attached as Exhibit A) - Fixed Fee per deliverable/milestone - Monthly retainer - Hybrid model

Invoicing: [MONTHLY / UPON MILESTONE / BI-WEEKLY]

Payment Terms: Net [15/30] days from invoice receipt.

Late Payment: 1.5%/month interest (or maximum allowed by law). Provider may suspend Services for invoices >30 days overdue.

Expenses: Pre-approved reasonable travel, materials, third-party costs. Receipts required for expenses >$25. Expense cap per SOW.

Taxes: Fees exclude taxes. Client responsible for applicable sales/use/VAT taxes.


4. Service Levels (SLA)

Applicability: SLAs defined per SOW. May include: - Availability/Uptime: [e.g., 99.9%] monthly - Response Time: [e.g., 1 hour for Critical, 4 hours for High, 1 business day for Medium] - Resolution Time: [e.g., 4 hours Critical, 1 business day High, 3 business days Medium] - Service Credits: [e.g., 5% monthly fee per 0.1% below uptime target, capped at 20% monthly fee]

Exclusions: Scheduled maintenance, force majeure, Client-caused issues, third-party dependencies.

Reporting: Provider delivers monthly SLA report.


5. Intellectual Property

Client IP (Deliverables): All work product, deliverables, reports, code, designs, documentation created by Provider under this Agreement ("Deliverables") — Client owns upon full payment of applicable SOW fees.

Provider IP (Retained): Provider retains all rights to: - Pre-existing methodologies, frameworks, tools, libraries, templates - Know-how, processes, general expertise - Aggregated/anonymized data not identifying Client

License to Provider IP: Client receives perpetual, non-exclusive, worldwide, royalty-free license to use Provider IP solely as embedded in Deliverables.

Third-Party IP: Provider shall not incorporate third-party IP without Client's prior written consent (except open-source with compatible licenses).


6. Confidentiality

Definition: Non-public information disclosed by either Party, including business plans, technical data, customer lists, pricing, trade secrets.

Obligations: - Use only for performing Services - Protect with reasonable care (at least same as own) - Limit access to need-to-know personnel bound by confidentiality - No disclosure without consent (except legal requirement with notice)

Exceptions: Public domain, independently developed, rightfully from third party, legal compulsion.

Data Protection: Provider complies with applicable privacy laws. Data Processing Addendum attached if personal data processed.

Survival: 3 years post-termination (perpetual for trade secrets).

Return/Destruction: Upon request or termination, return/destroy Confidential Information, certify compliance. One archival copy permitted for legal compliance.


7. Limitation of Liability

CAP: Each Party's total liability limited to fees paid/payable by Client in 12 months preceding claim.

EXCLUDED DAMAGES: No liability for indirect, incidental, special, consequential, punitive damages, or lost profits/data/business.

CARVE-OUTS (Cap does not apply): - IP infringement - Confidentiality breach - Data protection violations - Fraud / willful misconduct - Indemnification obligations - Payment obligations

Insurance: Provider maintains: - Professional Liability (E&O): $[1M] minimum - General Liability: $[1M] minimum - Cyber Liability: $[1M] minimum (if handling Client data) - Workers' Compensation: as required by law


8. Term & Termination

Termination for Convenience: Either Party may terminate this Agreement with [30/60/90] days written notice.

Termination for Cause: Either Party may terminate with [15/30] days written notice if other Party materially breaches and fails to cure within notice period. Immediate termination for insolvency/bankruptcy.

Effect on Active SOWs: - Termination for Convenience: Active SOWs continue to completion unless separately terminated - Termination for Cause: Non-breaching Party may terminate active SOWs immediately

Transition Obligations (30 days post-termination): - Provider delivers all work-in-progress, Deliverables, documentation - Provider provides knowledge transfer and reasonable cooperation - Client pays for Services through termination date - Client returns/destroys Provider Confidential Information

Surviving Sections: 5, 6, 7, 8, 9, 10, 11, 12.


9. Change Orders

Process: Any change to SOW scope, timeline, or fees requires a written Change Order signed by both Parties.

Change Order Contents: - Description of change - Impact on timeline - Impact on fees (additional/reduced) - Impact on SLAs/deliverables - Effective date

Emergency Changes: Provider may implement critical fixes without prior Change Order, but must document and seek ratification within 5 business days.


10. Indemnification

Provider Indemnifies Client against third-party claims arising from: - Provider's negligence or willful misconduct - IP infringement by Deliverables - Breach of confidentiality - Violation of applicable law

Client Indemnifies Provider against third-party claims arising from: - Client's use of Deliverables beyond licensed scope - Client-provided materials/content - Client's breach of this Agreement

Procedure: Indemnified Party promptly notifies, grants control of defense, provides reasonable cooperation. Indemnifying Party may not settle without consent (not unreasonably withheld) unless settlement includes full release and no admission of fault.


11. Warranties & Disclaimers

Provider Warranties: - Services performed in professional, workmanlike manner - Deliverables conform to SOW specifications - No knowing IP infringement - Compliance with applicable laws

DISCLAIMER: EXCEPT AS EXPRESSLY WARRANTED, SERVICES AND DELIVERABLES PROVIDED "AS IS." NO IMPLIED WARRANTIES OF MERCHANTABILITY, FITNESS FOR PARTICULAR PURPOSE, OR NON-INFRINGEMENT.


12. General Provisions

Governing Law: [STATE] law, without regard to conflict of laws.

Dispute Resolution: Good faith negotiation (30 days) → Mediation in [CITY, STATE] → Binding arbitration (AAA/JAMS rules).

Independent Contractor: Provider is independent contractor. No employment, partnership, agency, joint venture.

Assignment: Neither Party may assign without prior written consent (except to affiliate or successor in merger/acquisition).

Force Majeure: Excused performance for events beyond reasonable control.

Notices: Via email to addresses above, effective upon receipt.

Entire Agreement: This Agreement + SOWs + Exhibits = complete understanding.

Amendments: Only in writing signed by both Parties.

Severability: Unenforceable provisions severed; remainder stays in effect.

Counterparts: Electronic signatures valid.


Signatures

CLIENT By: ____ Name: ___ Title: ____ Date: ___

SERVICE PROVIDER By: ____ Name: ___ Title: ____ Date: ___


Exhibit A: Rate Card

[ROLE / SERVICE TIER] [HOURLY RATE] [DAILY RATE]
[Senior Architect] $[RATE] $[RATE]
[Senior Engineer] $[RATE] $[RATE]
[Project Manager] $[RATE] $[RATE]
[Designer] $[RATE] $[RATE]

Exhibit B: Data Processing Addendum (if applicable)

[ATTACH IF PERSONAL DATA PROCESSED]

Key Clauses — What to Watch

These clauses often contain terms that favor the other party. Review carefully before signing.

Section 1

Scope & Statement of Work

MSA governs the relationship; each project is a separate SOW. Ensure SOWs incorporate MSA terms and define deliverables, timeline, acceptance criteria.

Section 3

Fees & Payment

Define rate card, invoicing frequency, payment terms (Net 15-30), late fees. Address expense reimbursement with caps and pre-approval.

Section 4

Service Levels (SLA)

Define uptime, response times, resolution times, credits for misses. Keep SLAs measurable and tied to specific services.

Section 5

Intellectual Property

Client owns deliverables; Provider retains methodology/tools. Critical distinction for repeatable service providers.

Section 7

Liability Cap

Cap at fees paid (12 months). Carve-outs for IP, confidentiality, data breach, fraud. Watch for uncapped indemnity.

Section 8

Term & Termination

MSA term vs. SOW term. Termination for convenience (30-90 days). Termination for cause with cure period. Effect on active SOWs.

Section 9

Change Orders

Formal process for scope changes. Written, signed, with fee/timeline impact. Prevents scope creep.

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Frequently Asked Questions

MSA vs SOW

MSA = master terms governing the relationship (legal, IP, liability, termination). SOW = project-specific scope, timeline, deliverables, fees. You sign one MSA, then multiple SOWs under it.

MSA for SaaS

This template is for professional/managed services. SaaS agreements need different terms: subscription fees, uptime SLA, data processing addendum, feature roadmap disclaimers. Use a SaaS-specific template for software subscriptions.

Liability cap

Standard: 1x annual fees or fees paid in prior 12 months. Carve-outs: IP infringement, confidentiality breach, data protection violations, fraud/willful misconduct, indemnification obligations. Never accept unlimited liability.

Active SOWs on termination

Typically: active SOWs continue until completion or separate termination. MSA termination does not auto-terminate SOWs unless specified. Define transition obligations (knowledge transfer, data return).

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Disclaimer: Templates and analysis are provided for general informational purposes and do not constitute legal advice. Laws and requirements vary by jurisdiction. Consult a qualified attorney for your specific situation.