Free Software Development Agreement Template

Software Development Agreement

Date: [Date]

Parties:

(1) [Insert your company/business name], a [company incorporated in England and Wales] under company number [Company Number], whose registered office is at [Registered Address] (the "Developer"); and

(2) [Client Full Legal Name], a [company incorporated in England and Wales] under company number [Company Number], whose registered office is at [Registered Address] (the "Client"),

together referred to as the "Parties" and each a "Party".

1. Definitions and interpretation

1.1 In this Agreement, except where the context otherwise requires, the following expressions have the following meanings:

1.2 "Acceptance Criteria" means the criteria for acceptance of the Deliverables as specified in the relevant Statement of Work or as otherwise agreed between the Parties in writing.

1.3 "Acceptance Tests" means the tests to be conducted in accordance with clause 9 to determine whether the Deliverables meet the Acceptance Criteria.

1.4 "Business Day" means any day which is not a Saturday, Sunday, or public holiday in England and Wales.

1.5 "Change Request" means a written request for a change to the scope, Deliverables, timeline, or Fees, submitted in accordance with clause 4.

1.6 "Confidential Information" means all information of a confidential nature disclosed by one Party to the other in connection with this Agreement, whether disclosed in writing, orally, visually, or by any other means.

1.7 "Deliverables" means the software, code, documentation, and other materials to be developed and delivered by the Developer pursuant to a Statement of Work.

1.8 "Fees" means the fees payable by the Client to the Developer for the Services as set out in the relevant Statement of Work.

1.9 "Intellectual Property Rights" means all patents, copyrights, design rights, trade marks, database rights, trade secrets, know-how, rights in confidential information, and all other intellectual property rights (whether registered or unregistered) and all applications for and renewals or extensions of such rights.

1.10 "Milestone" means a key deliverable or stage of the project as set out in the Statement of Work.

1.11 "Personal Data", "Data Controller", "Data Processor", "Data Subject", and "processing" shall have the meanings given to them in the UK General Data Protection Regulation (UK GDPR) and the Data Protection Act 2018.

1.12 "Pre-Existing Materials" means any software, code, frameworks, libraries, tools, methodologies, or other materials that were created by or on behalf of the Developer prior to the commencement of this Agreement or independently of this Agreement.

1.13 "Services" means the software development and related services to be provided by the Developer as set out in the Statement of Work.

1.14 "Software" means the software to be developed by the Developer pursuant to a Statement of Work.

1.15 "Statement of Work" or "SOW" means a document agreed between the Parties describing the scope of the Services, Deliverables, Milestones, timeline, and Fees for a particular project.

1.16 "Third-Party Materials" means any software, code, libraries, or other materials owned by a third party and incorporated into the Deliverables.

2. Scope of work

2.1 The Developer shall provide the Services and deliver the Deliverables in accordance with the applicable Statement of Work.

2.2 Each Statement of Work shall be agreed in writing and signed by both Parties and shall form part of this Agreement.

2.3 In the event of any conflict between the terms of this Agreement and a Statement of Work, the terms of this Agreement shall prevail unless the Statement of Work expressly states that it is intended to override a specific provision of this Agreement.

2.4 The Developer shall perform the Services with reasonable care, skill, and diligence, and in accordance with good industry practice.

2.5 [The initial Statement of Work is attached as Schedule 1 to this Agreement.]

3. Project milestones

3.1 The Developer shall use reasonable endeavours to complete each Milestone by the date specified in the Statement of Work. Time shall not be of the essence in relation to any Milestone dates unless expressly stated in the Statement of Work.

3.2 The Developer shall notify the Client promptly if it anticipates any delay in achieving a Milestone, together with the reasons for the delay and a revised estimated completion date.

3.3 The Parties shall hold regular progress meetings at intervals of not less than [frequency, e.g., weekly / fortnightly] to review progress against the Milestones and discuss any issues or risks.

3.4 The Developer shall provide written progress reports to the Client at [frequency, e.g., weekly / fortnightly / monthly] intervals, or as otherwise specified in the Statement of Work.

4. Change control

4.1 Either Party may request a change to the scope, Deliverables, timeline, or Fees by submitting a Change Request to the other Party.

4.2 Each Change Request shall specify: (a) the nature and detail of the proposed change; (b) the reason for the proposed change; (c) the impact of the proposed change on the Deliverables, timeline, and Fees; and (d) any other information reasonably requested by the other Party.

4.3 Within [number] Business Days of receipt of a Change Request, the receiving Party shall provide a written response, which may include acceptance, rejection, or a counter-proposal.

4.4 No Change Request shall be implemented unless and until it has been agreed in writing by both Parties. Until a Change Request is agreed, the Developer shall continue to perform the Services in accordance with the existing Statement of Work, unless otherwise agreed in writing.

4.5 Any agreed Change Request shall be documented as an amendment to the relevant Statement of Work and shall be signed by both Parties.

5. Client obligations

5.1 The Client shall:

(a) co-operate with the Developer in all matters relating to the Services and provide such information, materials, access, and assistance as the Developer may reasonably require;

(b) designate a project manager who shall have authority to make decisions on behalf of the Client in relation to the Services;

(c) provide timely feedback and approvals as required by the Statement of Work or as reasonably requested by the Developer;

(d) ensure that its systems, networks, and infrastructure meet any minimum technical requirements specified by the Developer; and

(e) obtain and maintain all necessary licences, consents, and permissions necessary for the Developer to perform its obligations under this Agreement.

5.2 If the Developer's performance of its obligations under this Agreement is prevented or delayed by any act or omission of the Client, the Developer shall not be liable for any resulting delay or failure to perform, and the Developer shall be entitled to a reasonable extension of time and reimbursement of any additional costs reasonably incurred.

6. Fees and payment

6.1 The Client shall pay the Fees as set out in the Statement of Work. Fees may be structured as [fixed price / time and materials / milestone-based payments] as specified in the Statement of Work.

6.2 [For time and materials engagements:] The Developer shall charge at the following rates: [Role: Rate per hour/day]. The Developer shall maintain accurate time records and submit timesheets to the Client [weekly / monthly].

6.3 [For milestone-based payments:] The Client shall pay the applicable Milestone payment within [number] days of the Developer achieving the relevant Milestone and providing an invoice.

6.4 All Fees are exclusive of VAT, which shall be payable by the Client at the prevailing rate.

6.5 The Client shall pay each invoice within [number] days of the date of the invoice by [bank transfer / other payment method] to the bank account nominated by the Developer.

6.6 If the Client fails to make any payment due under this Agreement by the due date, the Developer may, without limiting its other rights and remedies: (a) charge interest on the overdue amount at the rate of [number]% per annum above the base rate of the Bank of England from time to time; (b) suspend performance of the Services until all overdue amounts have been paid; and (c) exercise its rights under the Late Payment of Commercial Debts (Interest) Act 1998.

7. Intellectual property assignment

7.1 Subject to clauses 7.3 and 7.4, the Developer hereby assigns to the Client, with full title guarantee, all Intellectual Property Rights in the Deliverables (excluding Pre-Existing Materials and Third-Party Materials) with effect from the date of creation, including the right to sue for past infringement.

7.2 The Developer shall execute all documents and do all things reasonably necessary to give effect to the assignment in clause 7.1, including executing any formal assignments or other documents required to vest the Intellectual Property Rights in the Client.

7.3 Pre-Existing Materials: All Intellectual Property Rights in the Pre-Existing Materials shall remain the property of the Developer. The Developer grants to the Client a [non-exclusive, royalty-free, perpetual, irrevocable, worldwide] licence to use, modify, and sublicence the Pre-Existing Materials to the extent incorporated in the Deliverables, solely in connection with the Client's use of the Deliverables.

7.4 Third-Party Materials: The Developer shall identify all Third-Party Materials incorporated in the Deliverables in the relevant Statement of Work or otherwise in writing. The Client's use of Third-Party Materials shall be subject to the applicable third-party licence terms. The Developer warrants that it has obtained all necessary licences for the Third-Party Materials to be used as part of the Deliverables.

7.5 The Developer irrevocably and unconditionally waives all moral rights under the Copyright, Designs and Patents Act 1988 (and all similar rights in other jurisdictions) which the Developer has or will have in the Deliverables.

8. Warranties

8.1 The Developer warrants that:

(a) the Services will be performed with reasonable care, skill, and diligence, and in accordance with good industry practice;

(b) the Deliverables will conform to the specifications and requirements set out in the relevant Statement of Work;

(c) the Deliverables will be free from material defects for a period of [number] days from the date of acceptance (the "Warranty Period");

(d) to the best of the Developer's knowledge, the Deliverables will not infringe the Intellectual Property Rights of any third party;

(e) the Developer has the right and authority to enter into this Agreement and to assign the Intellectual Property Rights as contemplated herein;

(f) the Deliverables will not contain any viruses, malware, trojan horses, backdoors, or other harmful code; and

(g) the Developer shall comply with all applicable laws and regulations in the performance of its obligations under this Agreement.

8.2 If a defect is discovered during the Warranty Period, the Developer shall, at its own cost, promptly rectify the defect or provide a reasonable workaround.

8.3 Except as expressly set out in this Agreement, all warranties, conditions, representations, and terms, whether express or implied by statute, common law, or otherwise, are excluded to the fullest extent permitted by law.

9. Acceptance testing

9.1 Upon delivery of each Deliverable, the Developer shall notify the Client in writing that the Deliverable is ready for Acceptance Testing.

9.2 The Client shall conduct the Acceptance Tests within [number] Business Days of receiving such notification (the "Acceptance Test Period").

9.3 If the Deliverable passes the Acceptance Tests, the Client shall issue a written acceptance notice to the Developer within [number] Business Days of the completion of the Acceptance Tests.

9.4 If the Deliverable fails to pass the Acceptance Tests, the Client shall provide the Developer with a written notice specifying in reasonable detail the respects in which the Deliverable fails to meet the Acceptance Criteria.

9.5 The Developer shall use reasonable endeavours to rectify the identified failures within [number] Business Days and re-submit the Deliverable for Acceptance Testing.

9.6 If the Deliverable fails to pass the Acceptance Tests after [number] attempts, the Client may: (a) grant the Developer a further opportunity to rectify; (b) accept the Deliverable with a reduction in Fees reflecting the diminished value; or (c) terminate this Agreement (or the relevant Statement of Work) in respect of the relevant Deliverable and receive a refund of all Fees paid in respect thereof.

9.7 If the Client fails to conduct Acceptance Tests within the Acceptance Test Period, or fails to issue a rejection notice within [number] Business Days, the Deliverable shall be deemed accepted.

10. Support and maintenance

10.1 [The Developer shall / shall not] provide support and maintenance services for the Deliverables following acceptance.

10.2 [Where applicable:] The Developer shall provide support and maintenance services as set out in [Schedule [number] / the Statement of Work], including: (a) bug fixes and error corrections; (b) [minor updates and patches]; and (c) [telephone / email / online] support during [Business Hours].

10.3 Support and maintenance services shall be provided for a period of [number] [months / years] from the date of acceptance, subject to payment of the applicable support and maintenance fees of [amount / rate] [per month / per annum].

10.4 This clause shall not apply to defects arising from: (a) misuse of the Software by the Client; (b) modifications made to the Software by any person other than the Developer without the Developer's prior written consent; (c) the Client's failure to implement Updates recommended by the Developer; or (d) use of the Software with hardware or software not approved by the Developer.

11. Confidentiality

11.1 Each Party shall keep confidential all Confidential Information of the other Party and shall not disclose such Confidential Information to any third party without the prior written consent of the other Party, except: (a) to its employees, officers, agents, and professional advisers who need to know such information for the purposes of this Agreement, provided that such persons are bound by obligations of confidentiality no less onerous than those set out in this clause; or (b) as required by law, regulation, or order of a court or governmental authority.

11.2 The obligations of confidentiality shall not apply to information that: (a) is or becomes publicly available otherwise than through breach of this Agreement; (b) was known to the receiving Party before disclosure; (c) is received from a third party without obligation of confidentiality; or (d) is independently developed without use of the disclosing Party's Confidential Information.

11.3 The obligations of confidentiality shall survive termination of this Agreement for a period of [number] years.

12. Data protection

12.1 Each Party shall comply with its obligations under the UK GDPR and the Data Protection Act 2018 in respect of any Personal Data processed in connection with this Agreement.

12.2 To the extent that the Developer processes Personal Data on behalf of the Client in connection with the Services, the Developer shall act as a Data Processor and the Client shall act as the Data Controller. The Parties shall enter into a separate data processing agreement setting out the subject matter, duration, nature, and purpose of the processing, the types of Personal Data, and the categories of Data Subjects.

12.3 The Developer shall implement appropriate technical and organisational measures to protect Personal Data against unauthorised or unlawful processing and against accidental loss, destruction, or damage.

13. Limitation of liability

13.1 Nothing in this Agreement shall limit or exclude either Party's liability for: (a) death or personal injury caused by its negligence; (b) fraud or fraudulent misrepresentation; (c) any breach of the terms implied by section 2 of the Supply of Goods and Services Act 1982 (title and quiet possession); or (d) any other liability which cannot be limited or excluded by applicable law.

13.2 Subject to clause 13.1, neither Party shall be liable to the other Party, whether in contract, tort (including negligence), breach of statutory duty, or otherwise, for any: (a) loss of profits; (b) loss of sales or business; (c) loss of agreements or contracts; (d) loss of anticipated savings; (e) loss of use or corruption of software, data, or information; (f) loss of or damage to goodwill; or (g) any indirect or consequential loss, arising under or in connection with this Agreement.

13.3 Subject to clause 13.1, the total aggregate liability of either Party to the other Party, whether in contract, tort (including negligence), breach of statutory duty, or otherwise, arising under or in connection with this Agreement shall be limited to [the total Fees paid and payable by the Client under this Agreement / [amount]].

14. Indemnification

14.1 The Developer shall indemnify, defend, and hold harmless the Client against all claims, actions, proceedings, losses, damages, expenses, and costs (including court costs and reasonable legal fees) arising out of or in connection with any claim that the Deliverables (excluding Third-Party Materials) infringe the Intellectual Property Rights of any third party.

14.2 The Client shall indemnify, defend, and hold harmless the Developer against all claims, actions, proceedings, losses, damages, expenses, and costs (including court costs and reasonable legal fees) arising out of or in connection with: (a) any breach by the Client of this Agreement; (b) any claim relating to materials or data provided by the Client to the Developer; or (c) the Client's use of the Deliverables in a manner not authorised by this Agreement.

15. Term and termination

15.1 This Agreement shall commence on the date first set out above and shall continue until all Statements of Work have been completed, or until terminated in accordance with this clause.

15.2 Either Party may terminate this Agreement (or any Statement of Work) immediately by giving written notice to the other Party if:

(a) the other Party commits a material breach of this Agreement which (if remediable) is not remedied within [number] days of receiving written notice requiring it to be remedied;

(b) the other Party becomes insolvent, enters administration, goes into liquidation, makes an arrangement or composition with its creditors, or has a receiver, manager, or administrative receiver appointed over its assets; or

(c) the other Party ceases or threatens to cease to carry on business.

15.3 The Client may terminate this Agreement (or any Statement of Work) for convenience at any time by giving [number] days' written notice to the Developer. In such event, the Client shall pay the Developer for all Services performed and Deliverables delivered up to the date of termination, together with any reasonable costs incurred by the Developer as a direct result of such termination.

15.4 Upon termination or expiry of this Agreement: (a) the Developer shall deliver to the Client all completed and partially completed Deliverables, including all source code, documentation, and related materials; (b) each Party shall return or destroy all Confidential Information of the other Party; and (c) any provision of this Agreement that expressly or by implication is intended to survive termination shall remain in full force and effect.

16. Force majeure

16.1 Neither Party shall be in breach of this Agreement nor liable for any failure or delay in performing its obligations under this Agreement (other than obligations to make payment) if such failure or delay results from a Force Majeure Event.

16.2 "Force Majeure Event" means any circumstance not within a Party's reasonable control, including but not limited to acts of God, fire, flood, earthquake, epidemic, pandemic, war, terrorism, civil unrest, labour disputes, governmental actions, power failures, or internet or telecommunications failures.

16.3 The affected Party shall promptly notify the other Party of the Force Majeure Event and shall use reasonable endeavours to mitigate the effects of such event.

16.4 If a Force Majeure Event prevents a Party from performing its obligations for a continuous period of more than [number] days, the other Party may terminate this Agreement by giving [number] days' written notice.

17. General provisions

17.1 Entire agreement: This Agreement (together with all Statements of Work and documents referred to herein) constitutes the entire agreement between the Parties and supersedes all previous agreements, arrangements, and understandings between them relating to its subject matter.

17.2 Variation: No variation of this Agreement shall be effective unless it is in writing and signed by or on behalf of each of the Parties.

17.3 Waiver: No failure or delay by a Party to exercise any right or remedy provided under this Agreement or by law shall constitute a waiver of that or any other right or remedy.

17.4 Severability: If any provision of this Agreement is found to be invalid, illegal, or unenforceable, the remaining provisions shall continue in full force and effect.

17.5 Assignment: Neither Party may assign, transfer, or sublicence this Agreement or any of its rights or obligations under it without the prior written consent of the other Party. [The Developer may subcontract the performance of any of its obligations under this Agreement, provided that the Developer remains responsible for the performance of such obligations.]

17.6 Third party rights: A person who is not a party to this Agreement shall not have any rights under the Contracts (Rights of Third Parties) Act 1999 to enforce any term of this Agreement.

17.7 Notices: Any notice given to a Party under or in connection with this Agreement shall be in writing and shall be delivered by hand, by pre-paid first-class post, or by email to the addresses set out above or as otherwise notified in writing.

17.8 Independent contractor: The Developer is an independent contractor and nothing in this Agreement shall create a partnership, joint venture, agency, or employment relationship between the Parties.

18. Law and jurisdiction

18.1 This Agreement and any dispute or claim (including non-contractual disputes or claims) arising out of or in connection with it or its subject matter or formation shall be governed by and construed in accordance with the law of [England and Wales].

18.2 Each Party irrevocably agrees that the courts of [England and Wales] shall have exclusive jurisdiction to settle any dispute or claim (including non-contractual disputes or claims) arising out of or in connection with this Agreement or its subject matter or formation.

Signatures

Signed for and on behalf of [Insert your company/business name]:

Signature: ___________________________

Name: [Signatory Name]

Title: [Signatory Title]

Date: [Date]

Signed for and on behalf of [Client Full Legal Name]:

Signature: ___________________________

Name: [Signatory Name]

Title: [Signatory Title]

Date: [Date]

This document was created using a free template from SEQ Legal.