A SaaS Master Service Agreement (MSA) is a contract that establishes the terms and conditions between software as a service (SaaS) provider and its customers. The MSA typically covers the overall relationship between the parties and sets out the general terms and conditions that apply to all services provided under the agreement. This blog post will explore different clauses that should be included in a software-as-a-service MSA.
Service Level Agreement (SLA) Clause
The SLA clause sets out the minimum level of service that the SaaS provider must maintain. This clause includes uptime, response time, and system performance provisions. The SLA clause typically contains how performance will be measured and the consequences of failing to meet the specified service levels. It may also include provisions relating to compensation or penalties for failure to meet service-level requirements.
Payment and Billing Clause
The Payment and Billing clause sets out the fees payable by the customer for the services provided by the SaaS provider. This clause includes pricing structure, payment terms, and billing frequency provisions. It may also include provisions relating to taxes, early termination fees, and any other fees or charges that may be applicable.
Intellectual Property (IP) Clause
The IP clause identifies the ownership and use of the intellectual property rights in the software and any related materials. This clause includes provisions on the request of any IP created by the SaaS provider while providing the services and any pre-existing IP owned by the SaaS provider. It may also include provisions relating to the customer’s use of the software and any restrictions.
The Confidentiality clause sets out the obligations of the parties to protect the other party’s confidential information. This clause includes provisions on the definition of personal information, the parties’ responsibilities to protect that information, and the permitted uses of that information. It may also include provisions relating to the return or destruction of confidential information at the end of the agreement.
Data Protection Clause
The Data Protection Clause sets out the obligations of the parties to comply with applicable data protection laws and regulations. This clause includes provisions on the processing of personal data, the responsibilities of the parties about personal data, and any restrictions on the transfer of personal data. It may also include provisions relating to the use of data for analytics and reporting purposes.
The Termination clause sets out the conditions under which either party may terminate the agreement. This clause includes provisions on the notice required for termination, the consequences of termination, and any obligations of the parties upon termination. It may also include provisions relating to the payment of fees upon termination.
Limitation of Liability and Carve Outs for Liability
The Limitation of Liability clause sets out the parties’ liability about any losses or damages arising from the provision of the services. This clause includes conditions on the types of injuries that are recoverable, the limitations on the number of injuries that can be recovered, and any exclusions or limitations of liability. It may also include provisions relating to the allocation of risk between the parties.
In conclusion, a well-drafted software as a service Master Service Agreement should include a variety of clauses that address the key issues arising from the provision of SaaS services. These include the service level agreement, payment and billing, intellectual property, confidentiality, data protection, termination, and limitation of liability. By including these clauses in the MSA, the parties can help ensure that their rights and obligations are clearly defined, and that they are protected in the event of any disputes or issues arising from the provision of SaaS services. The clearer you make your SaaS agreements the easier things will be for you later.