Looking for a hassle-free way to kickstart your next software project? You’re in the right place.
Our free software development contract strips away the complexity, offering you a straightforward, easy-to-use contract template. This will save you time, reduce costs, and make sure all the important details are laid out, and protect both parties involved in the development process.
Let’s dive in and get your project off the ground.
Download Software Development Contract Template
- Software Development Contract Template [Download Google Doc]
- Software Development Contract Template [Download PDF]
Intro
This Software Development Agreement (“Agreement”) is entered into as of [Insert Date] (“Effective Date”) by and between [Client’s Full Legal Name] (“Client”) and [Developer’s Full Legal Name] (“Developer”). This Agreement sets forth the terms and conditions under which the Developer will develop and deliver the software project described herein to the Client.
1. Developer’s Duties
The Client engages the Developer, and the Developer agrees to undertake the project, developing the Software in line with Exhibit A (the “Specifications”). Key points include:
- The Developer is tasked with completing the Software by the milestones listed in Exhibit B, aiming for a completion date of May 12 (“Delivery Date”).
- For 20 days post-delivery, the Developer will offer up to 90 hours of support at no cost, with further assistance billed at $50/hour. They commit to addressing any software-related queries or issues within 30 days upon the Client’s request.
- The Client is not expected to provide additional support or assistance beyond what’s stipulated in this Agreement.
- The Client reserves the right to terminate this agreement if there’s a significant breach not remedied within 20 days of notification.
- Post-Delivery Date, the Developer will offer 3 days of training on the software’s operation, upon the Client’s request.
2. Delivery
The Software must meet the Specifications by the agreed Delivery Date.
1. Should the Software fail to match the Specifications, the Client has 30 days post-delivery to inform the Developer in writing about the discrepancies. Upon receiving such notification, the Developer will rectify any deviations from the Specifications.
2. Within 20 days following the Delivery Date, the Client must send the Developer written confirmation that the Software aligns with the Specifications, marking the “Acceptance Date,” unless it has been previously determined that the Software does not comply with the process outlined above.
3. Compensation
The Client agrees to compensate the Developer for completing the Software Project as outlined:
- Total Compensation: The project’s total compensation is set at $75,000, payable as defined in Exhibit C of this Agreement.
- Payment Milestones: Compensation is tied to achieving specific deliverables or project phases, detailed in Exhibit B, including key development milestones such as initial prototype completion, beta version release, and final product delivery.
- Final Payment: The last installment is due upon the Client’s formal acceptance of the Software Project, per criteria outlined in Exhibit D, ensuring the software meets all agreed-upon specifications and quality standards.
4. Intellectual Property Rights
Both parties recognize that the Client shall possess all intellectual property rights in the Software, including copyrights, trademarks, and any related rights. The Developer is prohibited from asserting any ownership claims over the Software’s intellectual property at any stage, both during and following the project’s completion and handover to the Client.
The Developer will ensure that the Software Project does not infringe on the intellectual property rights of any third party and will secure all necessary licenses for third-party software incorporated into the Software Project.
5. Change in Specifications
Any requests for changes to the project specifications by the Client must be made in writing and submitted to the Developer for evaluation. The Developer will assess the impact of the requested changes on the project scope, timeline, and cost, and provide the Client with a written proposal for implementing the changes. No changes shall be made to the project specifications without mutual agreement, documented in a signed amendment to this Agreement.
6. Confidentiality
The Developer is prohibited from sharing any of the Client’s business details or any information related to the Software, such as its code, specifications, or business strategies (“Confidential Information”). This includes not making unauthorized copies of Confidential Information or creating content based on its concepts for personal use or distribution, unless explicitly requested by the Client. The Developer must use the Confidential Information exclusively for the Client’s benefit.
7. Developer Warranties
The Developer assures the Client that:
- Developing and delivering the Software does not breach any agreements with other parties.
- The Software will not infringe on any third-party intellectual property rights.
- The Software is guaranteed to function as per the Specifications for 10 days post-delivery. Should any issues arise within this period, the Developer commits to promptly rectify these issues to ensure the Software meets the Specifications.
Any defects discovered within this warranty period will be corrected by the Developer at no additional cost to the Client.
8. Indemnification
The Developer agrees to indemnify and hold harmless the Client from any and all claims, liabilities, damages, and expenses (including reasonable attorneys’ fees) arising from any breach of this Agreement by the Developer, claims of intellectual property infringement by a third party, or from any breach of warranties or misrepresentations made herein by the Developer.
9. No Modification Unless in Writing
No modification, amendment, or waiver of any provisions of this Agreement shall be effective unless in writing and signed by both parties. Any oral representations or modifications concerning this Agreement shall be of no force or effect.
10. Applicable Law
The terms of this Software Development Agreement will be interpreted and enforced according to the laws of the State of New York. Any legal disputes arising from this agreement will be exclusively resolved in the courts within New York County, New York.
By signing below, both parties affirm their agreement to the terms of this Software Development Agreement, duly authorized by their respective officers on the dates provided.
| Signature | Signature |
| mm/dd//yyyy | mm/dd//yyyy |
| [Sender.company] | [Client.company] |
| [Sender.FirstName][Sender.LastName] | [Client.FirstName][Client.LastName] |
Simple Software Development Contract
- Simple Software Development Contract Template [Download Google Doc]
- Simple Software Development Contract Template [Download PDF]
This agreement, effective [Insert Date], is between [Client’s Full Legal Name] (“Client”) and [Developer’s Full Legal Name] (“Developer”), outlining the development and delivery of a specified software project.
1. Developer’s Duties
The Developer will create the Software according to Exhibit A (“Specifications”), completing it by [Delivery Date], provide 90 hours of post-delivery support free of charge, offer additional support at $50/hour, and conduct 3 days of operational training post-delivery.
2. Delivery
The Software will conform to the Specifications by [Delivery Date]. The Client can report non-conformities within 30 days, and the Developer will correct them. The Client confirms software acceptance within 20 days post-delivery.
3. Compensation
The Developer receives $75,000 total, following Exhibit C’s payment schedule, tied to deliverable completion and final acceptance.
4. Intellectual Property Rights
The Client owns all software intellectual property rights. The Developer ensures no infringement on third-party rights and obtains necessary licenses for third-party software used.
5. Change in Specifications
Changes must be written and approved, possibly adjusting scope, timeline, and cost.
6. Confidentiality
The Developer keeps the Client’s business and software details confidential, not using the information for personal gain.
7. Developer Warranties
The Developer ensures no breach of contract, no third-party intellectual property infringement, and software functionality per Specifications for 10 days post-delivery.
8. Indemnification
The Developer indemnifies the Client against all related legal claims and expenses due to agreement breaches or intellectual property infringement.
9. No Modification Unless in Writing
Changes to this agreement require written consent from both parties.
10. Applicable Law
Governed by New York State law, any disputes will be resolved in New York County courts.
| Signature | Signature |
| mm/dd//yyyy | mm/dd//yyyy |
| [Sender.company] | [Client.company] |
| [Sender.FirstName][Sender.LastName] | [Client.FirstName][Client.LastName] |
10 Key Elements of a Software Development Contract
To guarantee a comprehensive and protective legal framework for your software development project, your contract should meticulously include these 10 elements:
I. Scope of Work
This defines the specific tasks the developer is to perform, including features, functionalities, and deliverables of the software.
Example: The scope includes developing a web-based inventory management system with real-time tracking, user authentication, and reporting features.
II. Payment Terms
This details how and when the developer will be paid, including the total amount, payment schedule, and conditions for each payment.
Example: The client agrees to pay $30,000 in 3 stages: $10,000 upfront, $10,000 after the beta version, and $10,000 upon final delivery.
III. Intellectual Property Rights
This specifies who owns the software, the code, and any related copyrights and patents after the project’s completion.
Example: Upon final payment, the client will own the software and all related IP, while the developer can use generic parts of the code in future projects.
IV. Timeline & Milestones
Establishes a project timeline, including start and end dates, and key milestones for deliverable parts of the project.
Example: The project starts on January 1st, with a prototype due by March 1st, a beta version by June 1st, and the final version by September 1st.
V. Confidentiality
Protects sensitive information shared during the development process from being disclosed to third parties.
Example: The developer agrees not to share any of the client’s business processes, software functionalities, or user data learned during the project.
VI. Developer Warranties
Guarantees provided by the developer regarding the quality of the software and adherence to specifications.
Example: The developer warrants that the software will be free from defects for 12 months after delivery.
VII. Change Management
Outlines how changes to the project scope or specifications will be handled, including procedures for requesting, approving, and implementing changes.
Example: Any request for changes must be submitted in writing and will result in an adjusted timeline and cost, agreed upon by both parties.
VIII. Termination Clauses
Defines conditions under which either party can terminate the agreement, including notice periods and consequences of termination.
Example: Either party can terminate the contract with 30 days written notice if the other party breaches the agreement and fails to remedy the breach within 15 days of notification.
X. Dispute Resolution
Describes the process for resolving any disputes that arise from the agreement, often including mediation or arbitration before legal action.
Example: In the event of a dispute, both parties agree to first seek resolution through mediation, with costs to be shared equally.
To make sure all your bases are covered, refer to this checklist as your guide.
- Have all specific tasks, features, functionalities, and deliverables been clearly defined in the Scope of Work?
- Are the payment terms, including the total amount, payment schedule, and conditions, clearly outlined?
- Does the agreement specify who will own the intellectual property rights upon project completion?Is there a clear timeline and set of milestones for deliverable parts of the project?
- Are confidentiality measures to protect sensitive information adequately addressed?
- Do the developer warranties cover the quality and adherence to specifications of the software?
- Is there a detailed change management process for handling scope or specification adjustments?
- Are the termination clauses, including notice periods and consequences, clearly defined?
- Is the dispute resolution process, including steps like mediation or arbitration, well described?
Software Development Contract Terms: Negotiable vs. Non-negotiable
Not all contract terms are set in stone, in this section we will understand which terms you can adjust and which are non-negotiable to help you create a fair deal for both sides.
6 Negotiable Elements
Payment Terms: Both parties can discuss and agree on a fair price, payment schedule, and conditions based on the project’s scope and complexity.
Delivery Timelines: Negotiable as project scope, resources, and external factors can influence timelines. Flexibility is needed from both sides to accommodate changes.
Scope of Work: This is often adjusted as discussions progress, to ensure both parties’ needs are met and to reflect any changes in project requirements or objectives.
Warranty Periods: The length and terms can be negotiated to provide assurances to the client while being realistic about the developer’s capacity to support the project post-launch.
Post-Launch Support: Open for negotiation to determine the level of support needed, response times, and any additional costs for extended services.
Intellectual Property Rights: Parties can negotiate who holds the rights to the software, considering the developer’s work and the client’s use of the software.
3 Non-Negotiable Elements
Legal Compliance: Non-negotiable as both parties must adhere to existing laws and regulations to ensure the contract is enforceable and to avoid legal penalties.
Ethical Standards: These are foundational and non-negotiable to maintain integrity, confidentiality, and professional conduct throughout the project.
Data Protection: Given strict regulations like GDPR, ensuring data security and privacy is a legal requirement and not subject to negotiation.
7 Common Mistakes to Avoid in Software Development Contracts
- Define the Scope: Make every project goal, feature, and deliverable crystal clear.
- Structure Payments: Lay out when, how much, and under what conditions payments will be made.
- Allocate IP Rights: Decide who owns the software and its intellectual property rights after creation.
- Manage Changes Effectively: Set up a system to handle any changes to the project smoothly.
- Protect Confidential Info: Keep all sensitive business and project information secure.
- Set Clear Exit Rules: Outline how and when the contract can be terminated.
- Resolve Disputes Swiftly: Agree on a method to sort out any disagreements quickly.
Conclusion
Always remember: clarity is king in software development contracts.
Clear terms prevent misunderstandings and build trust. Before signing, make sure every clause is understood by all parties. This simple step can save you from future disputes so you can build a successful partnership.
Feel free to download these software development contract templates without signing up. Feel free to adjust to your specifications.
- Software Development Contract Template [Google Doc Click Here] [PDF Click Here]
- Simple Software Development Contract Template [Google Doc Click Here][PDF Click Here]
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FAQs
1. What is the best contract type for software development?
The best contract type for software development is a detailed Fixed-Price Contract. This contract clearly outlines the project scope, costs, and timelines, minimizing uncertainties and providing a structured framework for a smooth and successful software development journey.
2. How do software contracts work?
Software contracts work as legal agreements for a development project. They detail project specifics, timelines, payments, and responsibilities. These contracts guide and ensure clear communication, setting the foundation for successful collaboration throughout the project.
3. How do you negotiate an IT contract?
To negotiate an IT contract, you can follow the steps below:
- Research industry standards.
- Set clear expectations.
- Prioritize critical terms.
- Be open to compromise.
- Communicate effectively.
- Ask for legal advice if needed.
Craft an agreement aligned with your business goals for a successful negotiation process.
4. Can you get out of a software contract?
Yes, you can exit a software contract if:
- If the agreed-upon tasks or performance of the services outlined in the contract are completed.
- If the parties involved mutually agreed to terminate the contract before its expiration date
- If one party fails to fulfill its obligations as outlined in the contract (breach of contract), the other party may have the right to terminate the contract.
- If the clauses include allowing one or both parties to terminate the contract for convenience, without specifying a reason.
- If there are unforeseen events or circumstances beyond the control of the parties (force majeure), the purpose of the contract may become impossible or impracticable to fulfill, leading to termination.
- If terminated by court order or legal intervention, such as in cases of fraud, illegality, or incapacity of one of the parties.
