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Software Development Agreement

Agreement between a tech company and a development contractor covering deliverables, milestones, code ownership, and acceptance criteria.

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What's included

Project Scope, Deliverables, and Milestones

Defines the software development services, required deliverables, project specifications, milestone dates, dependencies, and delivery obligations.

Fees, Invoicing, and Payment Terms

Sets out the compensation model, payment schedule, invoice requirements, expense reimbursement rules, taxes, and consequences for late payment.

Intellectual Property Assignment

Assigns all rights, title, and interest in custom code, documentation, designs, and related work product to the company upon payment or creation, as applicable.

Acceptance Testing and Revision Process

Establishes objective testing criteria, review periods, rejection procedures, cure rights, deemed acceptance rules, and limits on included revisions.

Confidentiality and Data Security

Requires protection of confidential information, source code, credentials, business data, customer data, and security-sensitive materials disclosed during the project.

Warranty, Bug Fixes, and Non-Infringement

Provides limited warranties that the work will conform to specifications, be performed professionally, and not knowingly infringe third-party rights, with post-delivery defect correction obligations.

Termination and Transition Assistance

Allows termination for cause and, if selected, convenience, while addressing final payments, handover of code, return of materials, and transition support.

Liability, Indemnity, and Dispute Resolution

Allocates risk for claims, damages, IP infringement, confidentiality breaches, and disputes, including liability limits and forum or dispute resolution procedures.

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Frequently asked questions

Who should use a software development agreement?
A software development agreement should be used by companies, startups, and digital businesses that hire an outside developer, agency, or contractor to build software, applications, integrations, or technical deliverables.
Does this agreement transfer ownership of the code to the company?
Yes, the template is structured to include an intellectual property assignment so that custom code and work product created for the project belong to the company, subject to any stated exceptions for pre-existing materials or third-party components.
Why are acceptance criteria important?
Acceptance criteria create an objective process for reviewing deliverables, identifying defects, requesting corrections, and determining when work is approved, which helps reduce disputes over whether the project is complete.
What should be included in the warranty and bug-fix period?
The warranty provision should state how long the developer must correct qualifying defects after delivery or acceptance, what types of issues are covered, response expectations, and any exclusions for changes made by others or misuse.

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Templates/Software Development Agreement