Service Agreement Template
This client-friendly service agreement is for a business that is hiring a service provider and wants the contract to protect its own position. It is written for business use in any industry, with both parties set up as companies and the terms tilted towards the client throughout.
It fits engagements where the work can be split into stages and paid as each stage is accepted, such as consulting, technical, creative or other professional services. If you are the provider and want firmer payment protection and capped liability, the provider-friendly version is a better fit, and if you prefer shorter, plainer wording, consider the simple version instead.
Engagement and Scope of Services describes the services and deliverables and makes clear that out-of-scope work is unpaid without a signed change order. Term and Completion of Services keeps the agreement running until the client confirms in writing that all work has been accepted. Milestones, Acceptance, and Rejection of Deliverables gives the client a review period, free corrections and a refund right if deliverables keep failing. Change Control and Modifications to Scope lets the client reduce the services with a matching cut in fees. Fees and Milestone-Based Compensation fixes the fees, builds expenses into them and lets the client hold back a retention. Invoicing, Payment Terms, and Taxes adds set-off and the right to withhold disputed amounts. Intellectual Property Rights and Ownership of Deliverables gives the client ownership of everything produced, and Termination and Effects of Termination lets the client end the agreement for convenience.
Before use, fill in the placeholders, including [Client Legal Name], [Service Provider Legal Name], the milestone schedule, the fee amounts in [Currency] and the review periods marked [number]. Governing law, courts and other location details are deliberately left blank, so add your own and check the delay reductions, liability cap and insurance limits against your deal.
In DraftLex you can edit clauses online, rewrite a single section with AI and download the agreement in Word. This template is general information and not legal advice.
SERVICE AGREEMENT
This Service Agreement (this "Agreement") is made and entered into as of [Effective Date] (the "Effective Date"), by and between:
[Client Legal Name], a [type of entity] organized and existing under the laws of [Jurisdiction], having its registered office at [Client Address] (the "Client"); and
[Service Provider Legal Name], a [type of entity] organized and existing under the laws of [Jurisdiction], having its registered office at [Service Provider Address] (the "Service Provider").
The Client and the Service Provider are referred to in this Agreement individually as a "Party" and collectively as the "Parties".
WHEREAS, the Client carries on business in [Client Industry or Field of Activity] and wishes to engage an independent provider to perform certain services for its business purposes;
WHEREAS, the Service Provider represents that it possesses the expertise, personnel, resources, and experience necessary to perform such services in a professional and timely manner; and
WHEREAS, the Parties wish to set out the terms and conditions on which the Service Provider will perform the services and the Client will pay for them;
NOW, THEREFORE, in consideration of the mutual covenants set out herein and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows:
Definitions and Interpretation
In this Agreement, the following capitalized terms have the meanings set out below, unless the context clearly requires otherwise.
"Acceptance" means the Client's written confirmation, given in accordance with this Agreement, that a Deliverable or Milestone conforms to the Specifications and the Acceptance Criteria, and "Accept" and "Accepted" shall be construed accordingly.
"Acceptance Criteria" means the objective criteria, tests, and standards, as set out in this Agreement or as otherwise agreed in writing by the Parties, against which a Deliverable is to be evaluated by the Client to determine whether it conforms to the Specifications.
"Business Day" means any day other than a Saturday, a Sunday, or a public holiday in [Client Jurisdiction], on which commercial banks are generally open for business in [City or Jurisdiction].
"Change Order" means a written document signed by authorized representatives of both Parties that records an agreed modification to the Services, the Deliverables, the Milestones, the Fees, or the Timeline in accordance with this Agreement.
"Client Materials" means all data, documents, information, content, software, specifications, materials, and other items, in any form, that are furnished or made available by or on behalf of the Client to the Service Provider in connection with this Agreement.
"Confidential Information" means all non-public information, in any form or medium, disclosed by or on behalf of a Party to the other Party in connection with this Agreement, including business, financial, technical, and operational information, trade secrets, and the terms of this Agreement, whether or not marked as confidential, and which a reasonable person would understand to be confidential given its nature and the circumstances of disclosure.
"Deliverables" means all work product, materials, reports, documents, software, designs, data, and other items, in any form, that are created, developed, prepared, or delivered by or on behalf of the Service Provider for the Client in the course of performing the Services, including those identified in Section 5 and any Change Order, together with all drafts and works in progress.
"Fees" means the amounts payable by the Client to the Service Provider for the Services as set out in this Agreement, being the Milestone Fees and any other amounts expressly approved in a Change Order.
"Intellectual Property Rights" means all patents, copyrights, moral rights (to the extent waivable), trademarks, service marks, trade names, design rights, database rights, rights in software and source code, trade secrets, rights in know-how, and all other intellectual or industrial property rights, whether registered or unregistered, anywhere in the world, including all applications, renewals, and extensions thereof.
"Milestone" means each discrete stage, event, or group of Deliverables of the Services identified in this Agreement, the completion and Acceptance of which entitles the Service Provider to the corresponding Milestone Fee.
"Milestone Fee" means the fixed amount payable by the Client in respect of a Milestone, as specified in this Agreement.
"Services" means the services to be performed by the Service Provider under this Agreement, as described in Section 2, together with any additional or modified services agreed in a Change Order, and all services incidental or reasonably necessary for the proper performance thereof.
"Specifications" means the technical, functional, and qualitative requirements and descriptions for the Services and Deliverables, as set out in this Agreement or as otherwise agreed in writing by the Parties.
"Timeline" means the schedule for the performance of the Services and the delivery of the Deliverables and Milestones, as set out in Section 4, as it may be amended by a Change Order.
Headings are for convenience only and do not affect the interpretation of this Agreement. References to Sections are to sections of this Agreement. The words "including" and "includes" shall be deemed to be followed by "without limitation". The singular includes the plural and vice versa. References to "writing" include email, unless expressly stated otherwise.
If there is any conflict between the body of this Agreement and any Change Order, the Change Order shall prevail solely with respect to the matter it expressly addresses and only if it is duly signed by both Parties and expressly states its intention to override the relevant provision.
Engagement and Scope of Services
The Client hereby engages the Service Provider, and the Service Provider hereby accepts such engagement, to perform the Services for the Client on the terms and subject to the conditions of this Agreement.
The Services consist of the following: [Detailed description of the Services, including principal tasks, activities, and functions to be performed]. The Services shall include all tasks reasonably necessary for or incidental to the proper performance and completion of the foregoing, whether or not specifically enumerated.
The Deliverables to be produced and delivered under this Agreement are as follows: [Description of Deliverables, formats, and quantities]. The Deliverables shall conform to the Specifications, which are as follows: [Specifications and technical or functional requirements].
The Services shall be performed at [Location(s) of performance or "remotely, as appropriate"], or at such other location as the Parties may agree in writing.
The engagement of the Service Provider is non-exclusive as to the Service Provider's other clients, provided that the Service Provider shall not engage in any activity that conflicts with its obligations hereunder or that would result in the use or disclosure of the Client's Confidential Information for the benefit of any third party.
Nothing in this Agreement obliges the Client to engage the Service Provider for any services beyond the Services. Any additional services shall be performed only upon the Client's prior written request and in accordance with Section 6. The Service Provider shall not be entitled to payment for any services performed outside the scope of this Agreement without a signed Change Order.
Each Party shall appoint a representative with authority to act on its behalf in relation to the day-to-day administration of this Agreement. The Client's initial representative is [Client Representative Name, Title, Contact Details], and the Service Provider's initial representative is [Service Provider Representative Name, Title, Contact Details]. Either Party may replace its representative upon written notice to the other.
Term and Completion of Services
This Agreement shall commence on the Effective Date and, unless terminated earlier in accordance with its terms, shall continue in full force and effect until the Services have been completed in full, all Deliverables have been delivered to and Accepted by the Client, and all Milestones have been achieved (the "Term").
Completion of the Services shall occur only upon the Client's written confirmation that all Services have been fully performed and all Deliverables have been Accepted in accordance with Section 5 (the "Completion Date"). The mere delivery of a Deliverable or the passage of time shall not, of itself, constitute completion of the Services.
The Service Provider shall commence performance of the Services on [Commencement Date] or, if later, the Effective Date, and shall complete the Services on or before [Target Completion Date], subject to any extension agreed in a Change Order.
Upon the Completion Date, the Service Provider shall promptly return to the Client, or, at the Client's election, destroy, all Client Materials and Confidential Information of the Client in its possession or control, and shall certify in writing that it has done so within [number] days of the Client's request.
Expiry of the Term or earlier termination of this Agreement shall not affect any rights, obligations, or liabilities of either Party that have accrued prior to such expiry or termination, nor any provision that is expressed or intended by its nature to survive.
The Service Provider shall, for a period of [number] months following the Completion Date, provide reasonable assistance, at no additional charge, in clarifying or explaining the Deliverables and in correcting any defects or non-conformities identified by the Client.
Performance Standards and Timeline
The Service Provider shall perform the Services diligently, promptly, and in a professional and workmanlike manner, with the degree of skill, care, and judgment expected of a leading provider of services similar to the Services, and in accordance with generally accepted industry standards and best practices.
The Service Provider shall perform the Services and deliver each Deliverable and achieve each Milestone in accordance with the Timeline, as follows: [Timeline, including start dates, interim dates, and delivery dates for each Milestone]. Time is of the essence with respect to the Service Provider's obligations under this Agreement.
The Service Provider shall comply with the Specifications, with all reasonable written instructions and policies of the Client communicated to it, and with all applicable laws, regulations, and codes of conduct relevant to the performance of the Services.
The Service Provider shall provide the Client with written progress reports at intervals of [frequency], describing the status of the Services, the progress against the Timeline, any actual or anticipated delays or problems, and the corrective measures proposed. The Service Provider shall also attend progress meetings reasonably requested by the Client.
The Service Provider shall notify the Client in writing immediately, and in any event within [number] Business Days, upon becoming aware of any circumstance likely to delay or impair the performance of the Services or the achievement of any Milestone, specifying the cause, the anticipated duration, and the steps being taken to mitigate it.
If the Service Provider fails to achieve a Milestone by the date specified in the Timeline, other than as a result of a delay caused by the Client's breach of this Agreement, the Client shall be entitled, without prejudice to its other rights and remedies, to (a) a reduction of the relevant Milestone Fee by [percentage or amount] for each [day/week] of delay, up to a maximum of [percentage] of that Milestone Fee, which the Parties agree is a reasonable pre-estimate of the Client's loss and not a penalty; and (b) require the Service Provider, at its own cost, to adopt a recovery plan acceptable to the Client.
Where a delay is caused directly by the Client's failure to perform its obligations under this Agreement, the Service Provider shall be entitled to a reasonable extension of the affected dates in the Timeline, provided that it has notified the Client in writing of the delay and its cause within [number] Business Days of becoming aware of it.
Milestones, Acceptance, and Rejection of Deliverables
The Services shall be divided into the following Milestones, each of which has the corresponding Deliverables, Acceptance Criteria, and target date: [Milestone 1: description, Deliverables, Acceptance Criteria, target date]; [Milestone 2: description, Deliverables, Acceptance Criteria, target date]; [additional Milestones as required].
Upon completing each Milestone, the Service Provider shall deliver the relevant Deliverables to the Client and shall give the Client written notice of completion (a "Completion Notice"), accompanied by such documentation and evidence of testing as the Client may reasonably require.
The Client shall have [number] Business Days following receipt of the Completion Notice and the relevant Deliverables (the "Review Period") to review, inspect, and test the Deliverables against the Specifications and the Acceptance Criteria. The Client shall, within the Review Period, either (a) give written notice of Acceptance, or (b) give written notice of rejection specifying in reasonable detail the respects in which the Deliverables fail to conform.
If the Client rejects any Deliverable, the Service Provider shall, at its own expense and within [number] Business Days of the rejection notice, correct all identified non-conformities and redeliver the Deliverable, whereupon the Review Period shall begin again for the corrected Deliverable. The Service Provider shall not be entitled to any additional Fees for such correction.
If a Deliverable fails to conform to the Specifications or Acceptance Criteria after [number] resubmissions, the Client may, at its sole option and without prejudice to its other rights and remedies: (a) require further correction and redelivery; (b) accept the Deliverable subject to an equitable reduction in the applicable Milestone Fee; or (c) terminate this Agreement in whole or in part under Section 17, in which case the Service Provider shall refund any Fees paid in respect of the non-conforming Deliverable.
Acceptance shall be effective only if given expressly in writing by the Client's authorized representative. Neither the Client's use of, payment for, or failure to respond within the Review Period in respect of any Deliverable shall be deemed Acceptance, and no Acceptance shall waive any right of the Client in respect of latent defects or any breach of warranty discovered after Acceptance.
The Client's review, testing, or Acceptance of any Deliverable shall not relieve the Service Provider of any of its obligations or liabilities under this Agreement.
Change Control and Modifications to Scope
Either Party may propose a change to the Services, the Deliverables, the Milestones, the Timeline, or the Fees by submitting a written change request to the other Party describing the proposed change in reasonable detail.
Within [number] Business Days of receiving a change request from the Client, the Service Provider shall provide the Client with a written assessment of the proposed change, including its effect on the Services, the Deliverables, the Timeline, and the Fees, together with any assumptions made. The Service Provider shall not charge for the preparation of such assessment.
No change shall be binding on the Client unless and until it is recorded in a Change Order signed by an authorized representative of the Client. The Service Provider shall not perform any work outside the scope of the Services, and shall have no entitlement to additional compensation or time, in the absence of a signed Change Order.
The Client may, by written notice, at any time and at its discretion, reduce or omit any part of the Services. In such event, the Fees shall be equitably reduced by an amount reflecting the Services omitted, and the Service Provider shall be entitled only to payment for Services properly performed and Accepted prior to the date of such notice.
The Service Provider shall not unreasonably refuse or delay a change requested by the Client. Any adjustment to the Fees resulting from an approved change shall be calculated on a fair and reasonable basis, having regard to the rates and pricing underlying the Milestone Fees, and shall not exceed [rate or cap], unless otherwise agreed by the Client in writing.
Where a change is required to correct an error, omission, or non-conformity in the Services or arises from the Service Provider's act, omission, or default, the change shall be implemented at the Service Provider's sole cost, with no adjustment to the Fees or the Timeline.
Pending the execution of a Change Order, the Service Provider shall continue to perform the Services in accordance with this Agreement unless the Client instructs otherwise in writing.
Fees and Milestone-Based Compensation
In consideration of the proper performance of the Services, the Client shall pay the Service Provider the Milestone Fees set out in this Section, subject to the terms of this Agreement.
The Milestone Fees are as follows: [Milestone 1: Milestone Fee in [Currency]]; [Milestone 2: Milestone Fee in [Currency]]; [additional Milestones as required], for a total aggregate fee of [Total Fees in Currency] (the "Total Fee").
The Milestone Fees are fixed and, together with any amounts approved in a Change Order, constitute the entire compensation payable to the Service Provider for the Services and the Deliverables. The Total Fee shall not be increased for any reason, including increases in the Service Provider's costs, the passage of time, or the quantity of work required, except as agreed in a Change Order.
The Milestone Fees are inclusive of all costs and expenses incurred by the Service Provider in performing the Services, including labor, materials, equipment, travel, accommodation, subsistence, communications, and subcontractor charges. The Client shall reimburse expenses only if they are approved in advance in writing by the Client, are reasonable and properly documented, and are charged at cost without mark-up, up to a maximum of [amount in Currency].
A Milestone Fee shall become payable only upon Acceptance by the Client of all Deliverables associated with that Milestone in accordance with Section 5. No Fees shall be earned or payable for any Milestone that has not been Accepted, and no advance or partial payments shall be due unless the Client has agreed otherwise in writing.
The Client may retain [percentage] of each Milestone Fee (the "Retention") until the Completion Date and the expiry of the period specified in Section 3 for post-completion assistance, and shall release the Retention to the Service Provider within [number] days thereafter, subject to the Client's rights of set-off and deduction under this Agreement.
All amounts payable under this Agreement shall be stated and paid in [Currency].
Invoicing, Payment Terms, and Taxes
Following the Acceptance of each Milestone, the Service Provider shall submit to the Client a valid and properly itemized invoice for the corresponding Milestone Fee, which shall reference the Milestone, include a copy of the Client's written Acceptance, and contain such other information as the Client may reasonably require, including the Service Provider's tax registration details. Invoices shall be sent to [Client Invoicing Address or Email].
The Client shall pay each properly submitted and undisputed invoice within [number] days following the later of (a) completion of the relevant Milestone through the Client's Acceptance and (b) the Client's receipt of a valid invoice. Payment shall be made by [method of payment, e.g., bank transfer] to the account designated in writing by the Service Provider: [Service Provider Bank Account Details].
The Service Provider shall submit each invoice within [number] days after Acceptance of the relevant Milestone. The Client shall not be liable for any invoice submitted more than [number] days after the Acceptance of the relevant Milestone, nor for any amount not invoiced within [number] months of the date on which it became due.
If the Client disputes any invoice or portion of an invoice in good faith, it shall notify the Service Provider and may withhold payment of the disputed amount, while paying the undisputed portion. The Parties shall cooperate to resolve the dispute promptly, and the Service Provider shall continue to perform the Services during the dispute. Payment of a disputed amount shall not be deemed an admission or waiver.
The Client may set off against any amount payable to the Service Provider any amount owed by the Service Provider to the Client under this Agreement, including any delay-related reductions pursuant to Section 4.
If the Client fails to pay an undisputed amount when due, and such failure continues for [number] days after the Service Provider's written notice of non-payment, the Service Provider may charge simple interest on the overdue amount at the rate of [rate] per annum from the due date until the date of payment. Such interest shall be the Service Provider's sole remedy for late payment, other than the right to terminate for material breach under Section 17.
Each Party shall bear its own taxes. The Service Provider shall be solely responsible for all taxes, duties, levies, and contributions imposed on its income, personnel, and operations. The Fees are stated exclusive of any value-added, sales, or similar transaction tax, which, if applicable, shall be shown separately on the invoice and paid by the Client against a valid tax invoice. If the Client is required by law to withhold any tax from a payment, it may do so and shall remit such amount to the relevant authority, and the amount withheld shall be treated as paid to the Service Provider. The Service Provider shall provide the Client with all documentation reasonably required to apply any reduced withholding rate or exemption.
Obligations of the Service Provider
The Service Provider shall perform the Services and deliver the Deliverables in accordance with this Agreement, using suitably qualified, experienced, and adequately supervised personnel and all necessary equipment, tools, software, and facilities, all at its own cost.
The Service Provider shall comply with all laws, regulations, licenses, permits, and governmental requirements applicable to it and to the Services, and shall obtain and maintain, at its own expense, all licenses, permits, registrations, and consents required for the performance of the Services.
The Service Provider shall comply with the Client's policies and procedures that have been notified to it in writing, including those relating to security, safety, data protection, anti-bribery, anti-corruption, and ethical conduct, when accessing the Client's premises, systems, or data.
The Service Provider shall maintain complete and accurate records relating to the Services, the Deliverables, and the Fees for a period of [number] years after the Completion Date, and shall permit the Client, upon reasonable notice, to inspect, audit, and copy such records and to inspect the progress of the Services.
The Service Provider shall promptly inform the Client of any matter that may reasonably be expected to adversely affect its ability to perform this Agreement, including any change of control, insolvency event, litigation, loss of a required license, or conflict of interest.
The Service Provider shall take all reasonable measures to safeguard Client Materials, protect them from loss, damage, and unauthorized access, and use them solely for the purpose of performing the Services. Client Materials shall remain the property of the Client.
The Service Provider shall not, without the Client's prior written consent, make any public statement concerning this Agreement or the Services, or use the Client's name, logo, or trademarks for any purpose, including as a reference or in marketing materials.
Obligations of the Client
The Client shall provide the Service Provider with the Client Materials, information, and access to the Client's premises and systems, in each case as the Client reasonably determines to be necessary for the Service Provider to perform the Services, and on the dates reasonably agreed between the Parties.
The Client shall respond within a reasonable time to the Service Provider's reasonable written requests for decisions, approvals, or information that are necessary for the performance of the Services, and shall review Deliverables in accordance with Section 5.
The Client shall pay the Fees in accordance with the terms of Sections 7 and 8, subject to the Client's rights of withholding, set-off, and retention under this Agreement.
The Client shall make available a representative in accordance with Section 2 to liaise with the Service Provider on matters relating to the Services.
The Service Provider acknowledges that the Client's obligations under this Section are the Client's sole obligations in connection with the performance of the Services, and that the Client's failure to perform any such obligation shall excuse the Service Provider's delay only to the extent that it directly causes such delay, and only if the Service Provider has complied with the notice requirements of Section 4.
The Client's provision of the Client Materials or any assistance shall not relieve the Service Provider of its responsibility for the quality and accuracy of the Services and Deliverables, and the Service Provider shall promptly notify the Client of any inadequacy in the Client Materials of which it becomes aware.
Personnel, Subcontracting, and Independent Contractor Status
The Service Provider is an independent contractor. Nothing in this Agreement creates an employment, partnership, joint venture, agency, or fiduciary relationship between the Parties, and the Service Provider has no authority to bind the Client or to incur any obligation on its behalf.
The Service Provider shall be solely responsible for the supervision, direction, remuneration, and conduct of its personnel assigned to the Services ("Personnel"), including all wages, benefits, insurance, withholdings, social security contributions, and taxes. Personnel shall not be entitled to any benefits provided by the Client to its employees.
The Service Provider shall assign to the Services only the Personnel who have the requisite qualifications, skills, and experience. The key personnel identified as [Key Personnel Names and Roles] shall not be removed or replaced without the Client's prior written consent, except in the case of illness, death, resignation, or termination of employment, in which case the Service Provider shall promptly propose a replacement of equivalent qualifications, subject to the Client's approval.
The Client may, on reasonable grounds, require the removal of any Personnel from the Services by written notice, and the Service Provider shall promptly replace such Personnel at its own cost and without any adverse impact on the Timeline or the Fees.
The Service Provider shall not subcontract or delegate any part of the Services without the Client's prior written consent, which the Client may withhold in its sole discretion. Any approved subcontracting shall not relieve the Service Provider of any of its obligations, and the Service Provider shall remain fully liable for the acts, omissions, and defaults of its subcontractors as if they were its own.
The Service Provider shall ensure that each subcontractor and each member of the Personnel is bound by written obligations of confidentiality and assignment of Intellectual Property Rights no less protective of the Client than those set out in this Agreement.
The Service Provider shall indemnify the Client against any claim by Personnel or any subcontractor, or any governmental authority, asserting that such person is an employee of the Client or that the Client is liable for any wages, benefits, taxes, or contributions in respect of such person.
Intellectual Property Rights and Ownership of Deliverables
All Deliverables, and all Intellectual Property Rights therein, shall be owned exclusively by the Client from the moment of their creation. To the extent that any Deliverable or any such right does not vest in the Client automatically by operation of law, the Service Provider hereby irrevocably assigns, and shall cause its Personnel and subcontractors to assign, to the Client all right, title, and interest in and to the Deliverables and all Intellectual Property Rights therein, throughout the world, in perpetuity, free of any encumbrances, and without any further payment beyond the Fees.
To the extent that any work product is capable of being deemed a "work made for hire" or equivalent under applicable law, it shall be so deemed for the benefit of the Client. The Service Provider irrevocably waives, and shall procure the waiver of, all moral rights and similar rights in the Deliverables to the fullest extent permitted by law.
The Service Provider shall, at the Client's request and at the Client's expense (except where the need arises from the Service Provider's breach), execute all documents and do all acts necessary to perfect, register, record, or enforce the Client's rights in the Deliverables. The Service Provider hereby irrevocably appoints the Client as its attorney-in-fact to execute such documents if the Service Provider fails to do so within [number] days of request.
The Client Materials, and all Intellectual Property Rights therein, remain the exclusive property of the Client. The Service Provider is granted a limited, non-exclusive, non-transferable, revocable license to use the Client Materials solely to perform the Services during the Term.
To the extent that the Service Provider incorporates into any Deliverable any pre-existing materials, tools, or know-how owned by it or licensed to it that existed prior to the Effective Date or were developed independently of the Services ("Pre-Existing Materials"), the Service Provider shall identify them in writing to the Client in advance and, with effect from delivery, hereby grants to the Client a perpetual, irrevocable, worldwide, fully paid-up, royalty-free, non-exclusive, transferable, and sublicensable license to use, reproduce, modify, and otherwise exploit the Pre-Existing Materials as part of or in connection with the Deliverables.
The Service Provider shall not incorporate into any Deliverable any third-party or open-source material without the Client's prior written consent and, where consent is given, shall ensure the Client obtains all necessary licenses at the Service Provider's cost, such that the Client's use of the Deliverables is not restricted or subject to any obligation to disclose or license any Client-owned materials.
The Service Provider shall promptly notify the Client of any infringement or suspected infringement of the Intellectual Property Rights in the Deliverables of which it becomes aware.
Confidentiality and Non-Disclosure
Each Party (the "Receiving Party") shall keep confidential all Confidential Information of the other Party (the "Disclosing Party"), shall use it solely for the purpose of performing or receiving the benefit of this Agreement, and shall not disclose it to any third party except as permitted by this Section. All Deliverables and Client Materials shall be deemed the Confidential Information of the Client.
The Receiving Party may disclose Confidential Information only to its employees, officers, advisers, and, in the case of the Service Provider, approved subcontractors, who need to know it for the purposes of this Agreement and who are bound by written obligations of confidentiality at least as protective as those in this Agreement. The Receiving Party shall be liable for any breach by such persons.
The Receiving Party shall protect the Disclosing Party's Confidential Information using at least the same degree of care it uses for its own confidential information of a similar nature, and in any event no less than a reasonable degree of care, and shall promptly notify the Disclosing Party of any unauthorized use or disclosure.
The obligations in this Section shall not apply to information that the Receiving Party can demonstrate by written records: (a) is or becomes publicly available other than through breach of this Agreement; (b) was lawfully known to it prior to disclosure without a duty of confidentiality; (c) is lawfully received from a third party without restriction; or (d) is independently developed without use of or reference to the Confidential Information.
If the Receiving Party is required by law, court order, or a competent authority to disclose Confidential Information, it shall, to the extent legally permitted, give the Disclosing Party prompt prior written notice and reasonable assistance so that it may seek a protective order, and shall disclose only that portion legally required.
Upon the Disclosing Party's request, or upon termination or expiry of this Agreement, the Receiving Party shall promptly return or destroy all Confidential Information of the Disclosing Party, and certify in writing that it has done so, provided that the Receiving Party may retain copies to the extent required by law, subject to continuing confidentiality.
The obligations in this Section shall continue during the Term and for a period of [number] years after its expiry or termination, and, in respect of trade secrets and Client Materials, for so long as such information remains confidential. The Parties acknowledge that a breach of this Section may cause irreparable harm for which damages alone would be an inadequate remedy, and the Disclosing Party shall be entitled to seek injunctive relief without the need to post a bond or prove actual damages.
Representations and Warranties
The Service Provider represents, warrants, and covenants to the Client, as of the Effective Date and throughout the Term, that: (a) it is duly organized, validly existing, and in good standing under the laws of its jurisdiction of organization; (b) it has full power and authority to enter into and perform this Agreement; and (c) this Agreement constitutes its legal, valid, and binding obligation, enforceable in accordance with its terms.
The Service Provider further represents, warrants, and covenants that: (a) the Services shall be performed in a professional and workmanlike manner, in accordance with the standards in Section 4; (b) the Deliverables shall conform to the Specifications and Acceptance Criteria and shall be free from material defects; and (c) it has, and will maintain, all skills, qualifications, licenses, and resources necessary to perform the Services.
The Service Provider represents, warrants, and covenants that the Deliverables, and the Client's use, reproduction, modification, and exploitation thereof as contemplated by this Agreement, do not and shall not infringe, misappropriate, or violate any Intellectual Property Rights or other rights of any third party, and that the Service Provider has, and shall have, all rights necessary to assign the Deliverables to the Client as provided herein.
The Service Provider represents, warrants, and covenants that the Deliverables shall not contain any virus, malware, disabling code, or other harmful component, and that the Service Provider and its Personnel shall comply with all applicable laws, including those relating to anti-bribery, anti-corruption, sanctions, export controls, data protection, labor, and non-discrimination.
The Service Provider represents and warrants that there is no pending or threatened litigation, claim, or proceeding that would adversely affect its ability to perform this Agreement, and that its performance of the Services does not and shall not conflict with any other agreement or obligation by which it is bound.
The Service Provider warrants that, for a period of [number] months following Acceptance of the relevant Deliverable (the "Warranty Period"), the Deliverable shall continue to conform to the Specifications and to be free from defects. During the Warranty Period, the Service Provider shall, promptly and at its own expense, correct any non-conformity or defect notified by the Client, or, if it fails to do so within [number] Business Days, the Client may have the same corrected by a third party at the Service Provider's cost or obtain a refund of the corresponding Fees.
The Client represents and warrants that it is duly organized and validly existing, and that it has the power and authority to enter into this Agreement. Except as expressly provided in this Agreement, the Client makes no other representation or warranty, express or implied. The warranties of the Service Provider shall survive Acceptance, delivery, and payment, and shall be in addition to any other rights or remedies of the Client.
Indemnification and Limitation of Liability
The Service Provider shall defend, indemnify, and hold harmless the Client, its affiliates, and their respective officers, directors, employees, agents, successors, and assigns (the "Client Indemnitees") from and against any and all claims, demands, actions, proceedings, losses, liabilities, damages, penalties, fines, judgments, settlements, costs, and expenses (including reasonable legal fees) (collectively, "Losses") arising out of or in connection with: (a) any breach of this Agreement by the Service Provider; (b) any negligent, reckless, or wrongful act or omission or willful misconduct of the Service Provider, its Personnel, or its subcontractors; (c) any allegation that the Deliverables or the Client's use thereof infringe or misappropriate any third-party Intellectual Property Rights; (d) any bodily injury, death, or damage to tangible property caused by the Service Provider or its Personnel; and (e) any violation of applicable law by the Service Provider, its Personnel, or its subcontractors.
The Client shall give the Service Provider prompt written notice of any third-party claim for which indemnification is sought, provided that failure to give prompt notice shall relieve the Service Provider of its obligations only to the extent it is materially prejudiced thereby. The Service Provider shall assume the defense of the claim with counsel reasonably acceptable to the Client, and shall not settle any claim in a manner that imposes any liability or admission on the Client without the Client's prior written consent. The Client may participate in the defense with its own counsel at its own expense, and may assume control of the defense at the Service Provider's expense if the Service Provider fails to diligently defend.
If any Deliverable becomes, or in the Client's reasonable opinion is likely to become, the subject of an infringement claim, the Service Provider shall, at its own expense and without prejudice to the Client's other remedies, promptly (a) procure for the Client the right to continue using the Deliverable; or (b) modify or replace it so that it becomes non-infringing while retaining equivalent functionality; failing which, the Client may reject the Deliverable and receive a full refund of the Fees paid in respect thereof.
Subject to the following sentence, neither Party shall be liable to the other for any indirect, special, or consequential damages arising out of this Agreement. The foregoing exclusion shall not apply to, and no limitation or exclusion in this Agreement shall limit, the liability of the Service Provider in respect of: (a) its indemnification obligations under this Section; (b) breach of Section 13 (Confidentiality and Non-Disclosure) or Section 12 (Intellectual Property Rights and Ownership of Deliverables); (c) gross negligence, fraud, fraudulent misrepresentation, or willful misconduct; (d) death or personal injury; or (e) any liability that cannot be limited or excluded under applicable law.
Subject to the exceptions in the preceding clause, the total aggregate liability of the Client arising out of or in connection with this Agreement, whether in contract, tort (including negligence), or otherwise, shall not exceed the total Fees actually paid or payable by the Client for the Milestone giving rise to the claim. The Service Provider's aggregate liability shall be limited to [amount or multiple of Fees], except in respect of the matters described in the preceding clause, for which liability shall be unlimited.
The Client shall not be liable for any loss of profit, loss of revenue, loss of business, or loss of goodwill suffered by the Service Provider, whether arising from termination of this Agreement or otherwise.
The rights and remedies of the Client under this Section are cumulative and in addition to any other rights or remedies available under this Agreement or otherwise.
Insurance
The Service Provider shall, at its own cost, obtain and maintain throughout the Term, and for a period of [number] years thereafter where the cover is written on a claims-made basis, the following insurance policies with reputable insurers having a financial strength rating of at least [rating]: (a) commercial general liability insurance with a limit of not less than [amount in Currency] per occurrence; (b) professional liability or errors and omissions insurance with a limit of not less than [amount in Currency] per claim and in the aggregate; and (c) employer's liability and workers' compensation insurance, as required by applicable law.
[Additional insurance, such as cyber liability or property insurance, to be inserted if applicable, with limits of [amount in Currency]].
The Service Provider shall cause the Client to be named as an additional insured under the general liability policy, to the extent permitted by the insurer, and shall ensure that such policies are primary and non-contributory with respect to any insurance maintained by the Client.
Prior to commencing the Services, and thereafter upon the Client's request, the Service Provider shall furnish the Client with certificates of insurance evidencing the required coverage. Each policy shall provide for at least [number] days' prior written notice to the Client of cancellation, non-renewal, or material change.
The Service Provider shall ensure that each approved subcontractor maintains insurance coverage commensurate with the nature and value of the subcontracted services.
The insurance required under this Section shall not limit or relieve the Service Provider of any liability or obligation under this Agreement, and the Service Provider shall remain responsible for any deductibles, self-insured retentions, and uninsured losses. If the Service Provider fails to maintain the required insurance, the Client may, but is not obliged to, procure such insurance and deduct the cost from any amount payable to the Service Provider.
Termination and Effects of Termination
Either Party may terminate this Agreement by written notice with immediate effect if the other Party commits a material breach of this Agreement and, where such breach is capable of remedy, fails to remedy it within [number] days after receipt of written notice requiring it to do so.
The Client may terminate this Agreement, in whole or in part, at any time and for any reason or no reason, upon [number] days' prior written notice to the Service Provider, without any liability for such termination other than the payment obligations described in this Section.
The Client may terminate this Agreement immediately by written notice if: (a) the Service Provider becomes insolvent, is unable to pay its debts as they fall due, enters into any arrangement with its creditors, has a receiver, administrator, or liquidator appointed, or ceases or threatens to cease business; (b) the Service Provider undergoes a change of control, or assigns or subcontracts any of its obligations without the Client's consent; (c) the Service Provider commits a breach of Section 13 or Section 12, or engages in fraud, bribery, or any unlawful conduct; (d) the Service Provider repeatedly fails to meet Milestones or the Timeline; or (e) a force majeure event prevents the Service Provider from performing for more than [number] consecutive days.
The Service Provider may terminate this Agreement only if the Client fails to pay any undisputed Milestone Fee that is due and such failure continues for [number] days after the Client's receipt of a written notice of non-payment which expressly refers to this Section and states the Service Provider's intention to terminate.
Upon termination or expiry of this Agreement for any reason, the Service Provider shall: (a) immediately cease performance of the Services, unless otherwise instructed by the Client; (b) deliver to the Client all Deliverables, whether complete or in progress, and all Client Materials and Confidential Information; (c) provide reasonable assistance, at the Service Provider's cost where termination results from its default, to transition the Services to the Client or a replacement provider; and (d) deliver a final invoice for any Milestone Fees due within [number] days.
Upon termination other than for the Service Provider's breach, the Client shall pay the Service Provider the Milestone Fees for Milestones that have been completed and Accepted prior to the termination date, together with, in the Client's discretion, a fair and reasonable amount, not exceeding the pro-rata portion of the relevant Milestone Fee, for work in progress that the Client elects to retain. Upon termination due to the Service Provider's breach, the Client shall have no obligation to pay for any Milestone not Accepted, and the Service Provider shall refund all Fees paid in respect of non-conforming or undelivered Deliverables within [number] days.
Termination or expiry shall not affect any accrued rights, remedies, obligations, or liabilities of the Parties, and the following provisions shall survive: Sections 1, 7 and 8 (as to accrued amounts), 12, 13, 14, 15, 16, this Section, and 18, together with any other provision that by its nature is intended to survive.
Governing Law and Dispute Resolution
This Agreement, and any dispute, controversy, or claim arising out of or in connection with it, including its formation, validity, interpretation, performance, breach, or termination, and any non-contractual obligations arising out of or in connection with it, shall be governed by and construed in accordance with the laws of [Governing Law Jurisdiction], without regard to its conflict-of-law rules.
The Parties shall first attempt in good faith to resolve any dispute through negotiation between senior executives with authority to settle the dispute. Either Party may initiate this process by giving written notice describing the dispute in reasonable detail (a "Dispute Notice"). If the dispute is not resolved within [number] days after the Dispute Notice, either Party may refer the dispute to mediation or arbitration in accordance with this Section.
Any dispute not resolved under the preceding clause shall be finally resolved by [arbitration under the rules of [Arbitration Institution] by [number] arbitrator(s) / the courts of [Jurisdiction]]. The seat and place of arbitration (or the venue of the proceedings) shall be [City, Jurisdiction]. The language of the proceedings shall be English. Any award shall be final and binding upon the Parties, and judgment upon it may be entered in any court having jurisdiction.
To the extent that the dispute is submitted to the courts, the Parties irrevocably submit to the exclusive jurisdiction of the courts of [Jurisdiction] and waive any objection to such courts on the grounds of venue or forum non conveniens.
Notwithstanding the foregoing, the Client may at any time seek urgent injunctive or other interim or equitable relief from any court of competent jurisdiction to protect its Confidential Information or Intellectual Property Rights, or to prevent irreparable harm, without first complying with the dispute resolution procedure above.
Pending the resolution of any dispute, the Service Provider shall continue to perform the Services and its obligations under this Agreement, and the Client shall continue to pay all undisputed amounts when due.
Unless otherwise determined in the final decision, the costs of any dispute resolution proceedings, including reasonable legal fees, shall be borne by the unsuccessful Party.
Notices under this Agreement shall be in writing and delivered by hand, by internationally recognized courier, or by email with confirmation of transmission to the addresses set out below the Parties' signatures. This Agreement constitutes the entire agreement between the Parties with respect to its subject matter, supersedes all prior understandings, may be amended only in a writing signed by both Parties, may not be assigned by the Service Provider without the Client's prior written consent, and, if any provision is held invalid, the remaining provisions shall remain in full force and effect. No failure or delay in exercising any right shall operate as a waiver. This Agreement may be executed in counterparts, including by electronic signature, each of which shall be deemed an original.
IN WITNESS WHEREOF, the Parties have caused this Agreement to be executed by their duly authorized representatives as of the Effective Date.
CLIENT
[Client Legal Name]
Signature: [Signature]
Name: [Authorized Signatory Name]
Title: [Title]
Date: [Date]
Address for notices: [Client Notice Address]
Email for notices: [Client Notice Email]
SERVICE PROVIDER
[Service Provider Legal Name]
Signature: [Signature]
Name: [Authorized Signatory Name]
Title: [Title]
Date: [Date]
Address for notices: [Service Provider Notice Address]
Email for notices: [Service Provider Notice Email]