Software Development

Agreement Template
This Software Development Agreement (the Agreement or
Software Development Agreement) states the terms and
conditions that govern the contractual agreement between
[DEVELOPER.Company] having his principal place of business at
[DEVELOPER.Address], (the Developer), and [CLIENT.Company]
having its principal place of business at [CLIENT.Address] (the
Client) who agrees to be bound by this Agreement.
WHEREAS, the Client has conceptualized [QUICK DESCRIPTION OF
SOFTWARE] (the Software), which is described in further detail on
Exhibit A, and the Developer is a contractor with whom the Client
has come to an agreement to develop the Software.
NOW, THEREFORE, In consideration of the mutual covenants and
promises made by the parties to this Software Development
Agreement, the Developer and the Client (individually, each a
Party and collectively, the Parties) covenant and agree as
follows:
1.

DEVELOPERS DUTIES. The Client hereby engages the

Developer and the Developer hereby agrees to be engaged by the
Client to develop the Software in accordance with the specifications
attached hereto as Exhibit A (the Specifications).
a. The Developer shall complete the development of the Software
according to the milestones described on the form attached hereto
as Exhibit B. In accordance with such milestones, the final product
shall be delivered to the Client by [FINAL DELIVERY DATE] (the
Delivery Date).
b. For a period of [TIME FRAME] after delivery of the final product,
the Developer shall provide the Client attention to answer any
questions or assist solving any problems with regard to the

operation of the Software up to [NUMBER] of hours free of charge

and billed to the Client at a rate of [RATE] per hour for any
assistance thereafter. The Developer agrees to respond to any
reasonable request for assistance made by the Client regarding the
Software within [TIME FRAME] of the request.
c. Except as expressly provided in this Software Development
Agreement, the Client shall not be obligated under this Agreement
to provide any other support or assistance to the Developer.
d. The Client may terminate this Software Development Agreement
at any time upon material breach of the terms herein and failure to
cure such a breach within [TIME FRAME] of notification of such a
breach.
e. The Developer shall provide to the Client after the Delivery Date,
a cumulative [TIME FRAME] of training with respect to the operation
of the Software if requested by the Client.
2.
DELIVERY. The Software shall function in accordance with the
Specifications on or before the Delivery Date.
a. If the Software as delivered does not conform with the
Specifications, the Client shall within [TIME FRAME] of the Delivery
Date notify the Developer in writing of the ways in which it does not
conform with the Specifications. The Developer agrees that upon
receiving such notice, it shall make reasonable efforts to correct any
non-conformity.
b. The Client shall provide to the Developer written notice of its
finding that the Software conforms to the Specifications within [TIME
FRAME] days of the Delivery Date (the Acceptance Date) unless it
finds that the Software does not conform to the Specifications as
described in Section 2(A) herein.
3.
COMPENSATION. In consideration for the Service, the Client
shall pay the Company at the rate of [RATE] per hour (the Hourly
Rate), with a maximum total fee for all work under this Software
Development Agreement of [MAXIMUM TOTAL FEE]. Fees billed
under the Hourly Rate shall be due and payable upon the Developer
providing the Client with an invoice. Invoices will be provided for
work completed by the developer once every [PAY PERIOD].
PandaTip: This paragraph is constructed in such a manner that you can not only designate the rate of pay, but you
can set a cap in order to prevent costs from spiraling out of control due to inefficiency. For instance, you may want
to pay $50/hour, but no more than $3,000 in total. In such a case, you would pay the contractor $50 for the first 60
hours they work, but everything after that is unpaid.

4.

INTELLECTUAL PROPERTY RIGHTS IN THE SOFTWARE.

The Parties acknowledge and agree that the Client will hold all
intellectual property rights in the Software including, but not limited
to, copyright and trademark rights. The Developer agrees not to
claim any such ownership in the Softwares intellectual property at
any time prior to or after the completion and delivery of the
Software to the Client.

PandaTip: This paragraph expressly grants all intellectual property rights in the final product to the client. There are
copyright and (possibly) trademark rights inherent in every piece of software that dictate to whom the benefits of
owning the software will go. If this paragraph is not included, there is no clear delineation as to whom the law
grants such rights. This paragraph ensures that there is no confusion on the matter.

5.

CHANGE IN SPECIFICATIONS. The Client may request that

reasonable changes be made to the Specifications and tasks
associated with the implementation of the Specifications. If the
Client requests such a change, the Developer will use its best efforts
to implement the requested change at no additional expense to the
Client and without delaying delivery of the Software. In the event
that the proposed change will, in the sole discretion of the
Developer, require a delay in the delivery of the Software or would
result in additional expense to the Client, then the Client and the
Developer shall confer and the Client may either withdraw the
proposed change or require the Developer to deliver the Software
with the proposed change and subject to the delay and/or additional
expense. The Client agrees and acknowledges that the judgment as
to if there will be any delay or additional expense shall be made
solely by the Developer.
6.
CONFIDENTIALITY. The Developer shall not disclose to any
third party the business of the Client, details regarding the Software,
including, without limitation any information regarding the
Softwares code, the Specifications, or the Clients business (the
Confidential Information), (ii) make copies of any Confidential
Information or any content based on the concepts contained within
the Confidential Information for personal use or for distribution
unless requested to do so by the Client, or (iii) use Confidential
Information other than solely for the benefit of the Client.
7.
DEVELOPER WARRANTIES. The Developer represents and
warrants to the Client the following:

a. Development and delivery of the Software under this Agreement

are not in violation of any other agreement that the Developer has
with another party.
b. The Software will not violate the intellectual property rights of any
other party.
c. For a period of [TIME FRAME] after the Delivery Date, the Software
shall operate according to the Specifications. If the Software
malfunctions or in any way does not operate according to the
Specifications within that time, then the Developer shall take any
reasonably necessary steps to fix the issue and ensure the Software
operates according to the Specifications.
8.
INDEMNIFICATION. The Developer agrees to indemnify,
defend, and protect the Client from and against all lawsuits and
costs of every kind pertaining to the software including reasonable
legal fees due to the Developers infringement of the intellectual
rights of any third party.
PandaTip: By way of example, in the event any third party sues the Client for copyright infringement in the
Softwares code, the Developer will cover the costs to defend the Client in such an action.

9.

NO MODIFICATION UNLESS IN WRITING. No modification of

this Agreement shall be valid unless in writing and agreed upon by
both Parties.
10.
APPLICABLE LAW. This Software Development Agreement
and the interpretation of its terms shall be governed by and
construed in accordance with the laws of the State of [STATE] and
subject to the exclusive jurisdiction of the federal and state courts
located in [COUNTY], [STATE].
IN WITNESS WHEREOF, each of the Parties has executed this
Software Development Agreement, both Parties by its duly
authorized officer, as of the day and year set forth below.

[DEVELOPER.Company]

[DEVELOPER.FirstName] [DEVELOPER.LastName]
[DEVELOPER.Title]
[CLIENT.Company]

[CLIENT.FirstName] [CLIENT.LastName]
[CLIENT.Title]

EXHIBIT A
SOFTWARE SPECIFICATIONS
[FREEFORM PRODUCT FUNCTIONALITY DESCRIPTION]

EXHIBIT B
MILESTONE SCHEDULE