Build a Tailored Master Service Agreement

06/09/2023

30 min

Note: Links to our free templates are at the bottom of this long guide.
Also note: This is not legal advice

Introduction

Having a Master Service Agreement (MSA) in place is essential for any business or organization, and serves as a legally binding contract that outlines the rights and responsibilities of both parties involved in the relationship. By providing a clear and unambiguous description of the services being provided, setting out which party is responsible for what and what remedies are available should the agreement be breached, as well as establishing a framework for dispute resolution, an MSA can help protect businesses from potential disputes by making sure all parties understand their obligations.

The Genie AI team understands how important it is to have a well-drafted MSA in place - which is why we provide free master service agreement templates on our platform. As part of our mission to make legal documents easier to access, our template library has millions of datapoints which teach AI what a market-standard master service agreement looks like, allowing anyone to draft high quality legal documents without needing an expert.

In addition to having an up-to-date MSA in place, it’s also essential for everyone involved to be aware of their rights and responsibilities under the agreement. Regular reviews should also be conducted to ensure that any changes since signing are taken into account. With this in mind, read on below for our step-by-step guidance on how best you can tailor your Master Service Agreement and access our template library today!

Definitions

MSA: Master Service Agreement - A contract between two parties that outlines the terms and conditions of their relationship, including the services provided, fees, liabilities, and other relevant information.
Scope of Services: The detailed description of the services to be provided, including any exclusions or limitations, duration, deliverables, and ongoing maintenance requirements.
Duration: The length of time that services will be provided, including the start date, the expected end date, or any relevant renewal or termination provisions.
Deliverables: The end result of the services provided, including any performance or quality standards.
Ongoing Maintenance: Any periodic tasks that need to be fulfilled, such as software updates, bug fixes, or other maintenance activities.
Fees: The fee structure for the services, as well as any applicable billing and payment terms.
Taxes: Any local, state, or federal taxes that need to be taken into account.
Payment Currency: The currency used for all transactions, in accordance with the relevant laws and regulations.
Payment Penalties/Late Fees: Any penalties or late fees that may be imposed for late or incomplete payments, in accordance with any applicable laws and regulations.
Intellectual Property: Any rights and obligations of each party in relation to the intellectual property, as well as any restrictions on using the intellectual property.
Licenses: A legal document granting permission to use intellectual property, such as copyright or trademark laws.
Royalty Payments: A payment made to the owner of intellectual property in exchange for the use of the property.
Liability Limits/Waivers: Any limits or waivers on liability for each party, including any applicable caps on damages or losses, as well as any applicable immunity or indemnity provisions.
Insurance Requirements: Any insurance requirements for each party, such as general liability, property damage, or other forms of insurance.
Confidentiality: The parties’ obligations with respect to confidential information, including the scope and duration of the confidentiality obligations, as well as the permitted uses of confidential information.
Termination: The circumstances under which either party may terminate the agreement, including any applicable notice periods, as well as any post-termination obligations.
Dispute Resolution: A process for resolving disputes, including any applicable arbitration provisions, any applicable laws and jurisdiction, as well as any applicable mediation and arbitration requirements.
Representations and Warranties: Any warranties or representations made by either party, such as warranties or representations of title, quality, accuracy, or other relevant items.
Miscellaneous: Any additional specific issues that are relevant to the agreement, such as any applicable force majeure provisions, or any applicable governing laws or regulations.

Introduction
Defining the purpose of the MSA and the parties involved.
Scope of Services
Outlining the services to be provided, including any exclusions or limitations.
#1. Specifying the duration of the services.
#1. Establishing the deliverables and timeline.
#1. Identifying any ongoing maintenance requirements.
Fees and Billing
Describing the fee structure for the services, as well as any billing and payment terms.
#1. Setting out any applicable taxes.
#1. Establishing the payment currency.
#1. Defining any payment penalties or late fees.
Intellectual Property
Addressing any issues related to the ownership and use of intellectual property.
#1. Establishing the rights and obligations of each party.
#1. Defining any restrictions on using the intellectual property.
Liability and Indemnity
Establishing any liability limits or waivers, as well as any indemnification provisions.
#1. Specifying any limitations of liability.
#1. Identifying any insurance requirements.
Confidentiality
Establishing the parties’ obligations with respect to confidential information.
#1. Establishing the scope and duration of the confidentiality obligations.
#1. Defining the permitted uses of confidential information.
Termination
Describing the circumstances under which either party may terminate the agreement.
#1. Setting out any applicable notice periods.
#1. Outlining any post-termination obligations.
Dispute Resolution
Establishing a process for resolving disputes, including any applicable arbitration provisions.
#1. Specifying the applicable laws and jurisdiction.
#1. Identifying any applicable mediation and arbitration requirements.
Representations and Warranties
Identifying any warranties or representations made by either party.
Miscellaneous
Addressing any additional specific issues that are relevant to the agreement.
#1. Establishing any applicable force majeure provisions.
#1. Setting out any applicable governing laws or regulations.

Get started

Introduction

Understand the purpose of the Master Service Agreement (MSA).
Identify the parties involved in the MSA.
Determine if any other agreements need to be considered within the MSA.
Research relevant laws and regulations that will apply to the MSA.
Once research and understanding of the need for and parties involved in the MSA has been completed, you can check this off your list and move on to the next step.

Defining the purpose of the MSA and the parties involved.

Gather all the necessary information about the parties involved in the MSA, including contact information, name, business name, address, etc.
Determine the scope and purpose of the MSA, and its respective responsibilities, including the services to be provided, payment terms, warranties, etc.
Make sure to clearly define the termination clause, so that the parties are aware of their rights and obligations in the event of termination.
Draft the MSA and make sure to include all the necessary information as previously discussed.
Get the MSA signed by all parties involved.

You’ll know when you can check this off your list and move on to the next step when all parties have signed the MSA and have agreed to the purpose and scope of the agreement.

Scope of Services

Research and define the scope of services that will be provided, including any exclusions or limitations
Outline the specific services that will be provided to the customer, as well as any exclusions
Ensure that the scope of services is tailored to the customer’s needs and expectations
Identify any additional services that the customer may require, or any services that may be excluded
Draft a detailed list of services that the customer will receive and any limitations on those services
Include a clause that allows for the customer to request additional services that are outside the scope of the MSA
Ensure that all services are clearly defined and agreed upon by both parties
Once both parties have agreed on the scope of services, the MSA can be finalized and signed by both parties.

Outlining the services to be provided, including any exclusions or limitations.

Make a list of the services that the customer will need and the services that the provider will offer
Describe the scope of the services and any limitations or exclusions that may apply
Include any special conditions or circumstances that may apply to the services
Clarify which party is responsible for providing the resources necessary to complete the services
Outline any additional services that may be requested outside of the scope of the contract
When you have a clear list of services and any exclusions or limitations, you can move on to the next step.

Specifying the duration of the services.

• Agree on the total duration of services to be provided.
• Consider whether the agreement should be for a fixed period of time, or for an undetermined period with provisions for termination.
• Specify when services are to begin and end.
• Include provisions for modifications and extensions to the duration of the agreement, as needed.
• Include any provisions for termination of the agreement, such as termination for convenience or due to breach of contract.

You’ll know you’ve finished this step when you have clearly outlined the total duration of services to be provided, including any provisions for modifications, extensions, and termination.

Establishing the deliverables and timeline.

• Set out a detailed list of the deliverables and expected results that will be produced for the client.
• Determine the timeline for completion and delivery of the agreed services.
• Discuss and agree on a timeline for each deliverable.
• Make sure that the timeline is realistic and achievable.
• Document these deliverables and timeline in the Master Service Agreement.
• Check to make sure all the details are accurate and that the client is happy with the timeline.
• Once the timeline is agreed upon, the Master Service Agreement is ready to be signed.

Identifying any ongoing maintenance requirements.

Review the deliverables and timeline established in the previous step to determine if any ongoing maintenance is required.
Consider the complexity of the project and the scope of the deliverables to determine if additional maintenance is necessary.
Discuss with the customer and discuss any ongoing maintenance requirements and their associated costs.
Document any ongoing maintenance requirements in the Master Service Agreement.
Once the requirements are clearly defined and documented, you can check this step off your list and move onto the next step.

Fees and Billing

Establish a fee structure for the services and any additional fees associated with the services.
Define any billing and payment terms, including payment cycle, invoicing and payment method.
Specify the currency in which payment must be made.
Include any fees for late payments.
Specify the conditions under which fees may be waived, if applicable.
Check that the fees and billing terms are agreeable to both parties.
Finalize and sign the agreement.

Once all of the above steps have been completed, you can move on to the next step in the process: Describing the fee structure for the services, as well as any billing and payment terms.

Describing the fee structure for the services, as well as any billing and payment terms.

Outline the services and fees that will be charged for each service
Identify the payment frequency (e.g., monthly, quarterly, etc.)
Define the billing and payment terms; this may include the acceptable payment methods, any applicable late fees, and any interest fees
Include any other relevant terms that apply to the fees and billing (e.g., discounts, credits, etc.)
When finished, review the final fee structure and payment terms to ensure accuracy

You can check this off your list when you have a finalized fee structure and payment terms that both parties agree upon.

Setting out any applicable taxes.

Identify any applicable taxes, including local, state and/or federal taxes associated with the services
Outline any taxes that should be included in the invoice and payment terms
Specify the method for calculating any taxes or other applicable fees
Make sure all taxes and fees are clearly stated in the agreement
Once all taxes and fees are outlined in the agreement, it will be ready to move on to the next step of establishing the payment currency.

Establishing the payment currency.

• Establish the currency in which payments will be made.
• Consider any foreign exchange rates that may apply.
• Specify the currency in the MSA.
• Once the currency is specified in the MSA, you can check this off your list and move on to the next step.

Defining any payment penalties or late fees.

Specify any penalties for late payments, including any interest rates for overdue payments.
Outline any other fees that may be incurred as a result of late payments.
Confirm if these fees will be automatically charged or if they need to be manually calculated and assessed.
Once you have outlined the payment penalties or late fees, the next step is to outline Intellectual Property.
When you have completed this step, you will have a tailored Master Service Agreement that defines the payment penalties or late fees.

Intellectual Property

• Review the project scope and agree on which assets the service provider will own and which the customer will own.
• Identify any assets that may be owned by both parties (such as intellectual property created jointly).
• Establish a policy for the use of any confidential information, trade secrets, and intellectual property discovered during the project.
• Agree on the duration of protection to be afforded to any intellectual property rights.
• Identify any conditions under which the rights may be transferred or licensed to a third party.
• Establish any provisions for indemnification related to intellectual property infringement.

How you’ll know when you can check this off your list and move on to the next step: Once all of the terms related to intellectual property have been finalized, the parties can move on to the next step of addressing any issues related to the ownership and use of intellectual property.

Addressing any issues related to the ownership and use of intellectual property.

Outline the ownership of intellectual property – who owns the intellectual property rights before and after the agreement is signed?
Outline any restrictions on the use of intellectual property – can the parties use the intellectual property in the same way, or is there a restriction on how it can be used?
List any license agreements that need to be included in the agreement – this could include third-party licenses, open source licenses, or any other licenses that need to be included.
Specify any restrictions on the transfer of intellectual property – can the intellectual property be transferred to a third-party or is there a restriction on who can receive the intellectual property?
Specify any obligations to protect the intellectual property – do the parties have an obligation to protect the intellectual property from unauthorized use or disclosure?

Once you have addressed all of the above points, you can check this step off your list and move on to the next step.

Establishing the rights and obligations of each party.

Draft a section in the Master Service Agreement outlining the rights and obligations of each party
Include details of the service to be provided, any payment terms, and the terms of termination
Specify any applicable warranties or indemnification clauses
Have both parties review, negotiate and agree on the terms and conditions of the Master Service Agreement
Execute the agreement once all parties have come to an agreement

You will know you can check this step off your list and move on to the next step once both parties have agreed to and executed the Master Service Agreement.

Defining any restrictions on using the intellectual property.

Identify any specific intellectual property that will be subject to restrictions on use
Discuss the potential restrictions on the use of the intellectual property in detail
Agree on any limitations on the use of intellectual property in the contract
Include any restrictions on the use of the intellectual property in the contract
Specify any penalties that may be imposed for violations of the restrictions on the use of the intellectual property in the contract
Once all restrictions on the use of the intellectual property have been included and agreed upon, you can check this off your list and move on to the next step.

Liability and Indemnity

Agree to the scope of liability and indemnity that is appropriate for the situation
Outline the liability restrictions or waivers, including any related exclusions or limitations
Specify any indemnification provisions, including the types of damages to be indemnified and the parties responsible for the indemnification
Define the limits on the damages or losses that may be incurred by either party
Spell out any exclusions or limitations of liability
When you have outlined all liability and indemnity provisions, you can check this step off your list and move on to the next step.

Establishing any liability limits or waivers, as well as any indemnification provisions.

Determine appropriate liability limits or waivers and include them in the Master Service Agreement.
Consider including an indemnification provision in the Master Service Agreement.
Discuss the liabilities and indemnities with the other party to ensure that both parties are in agreement.
Draft the language for the liability limits or waivers, as well as the indemnification provisions, and include them in the Master Service Agreement.
Review the language with the other party to ensure that the terms are acceptable to both parties.
Once both parties have agreed to the liability limits or waivers, as well as the indemnification provisions, you can check this step off your list and move on to the next step.

Specifying any limitations of liability.

• Ensure that the language of the agreement clearly covers any and all limitations of liability.
• Include a provision that explicitly outlines who is responsible for any losses or damages, and to what extent.
• Clearly state the types of losses and damages that are not covered by the agreement.
• Specify any limitations on the duration of liability.
• Include a clause that holds both parties accountable for any direct losses.
• Once you have specified all limitations of liability, read through the agreement to make sure everything is clear and concise.

Once you have specified all limitations of liability, you can check this off your list and move on to the next step.

Identifying any insurance requirements.

Draft a list of insurance requirements and minimum limits of liability
Receive approval from the service provider’s insurance carrier
Add the insurance requirements to the Master Service Agreement
Include the approved limits of liability
Review and confirm that the insurance requirements and limits of liability are correct
Once you have received approval and the insurance requirements and limits of liability have been properly updated and included in the Master Service Agreement, you can check this step off your list and move on to the next step.

Confidentiality

Identify what information should be kept confidential
Draft confidentiality provisions regarding each party’s obligation to secure, use, and protect the confidential information of the other
Establish a process for sharing confidential information between the parties
Consider if any exceptions to the confidentiality provisions should be included
Have each party agree to the provisions through signature

Once you have identified what information should be kept confidential and drafted confidentiality provisions, you will have completed this step and can move on to the next one.

Establishing the parties’ obligations with respect to confidential information.

Draft and negotiate language in the MSA that explicitly defines confidential information, including defining what is and is not confidential.
Include language that establishes what the parties are entitled to do with the confidential information they receive.
Agree on the appropriate duration and scope of the confidentiality obligations.
Ensure that the obligations are sufficiently broad to cover any and all confidential information exchanged in the course of business.
Address the issue of third-party confidential information and how it should be treated.

When you have drafted and negotiated language that establishes the parties’ obligations with respect to confidential information, you can check this off your list and move on to the next step.

Establishing the scope and duration of the confidentiality obligations.

Establish and agree on the scope of the confidential information that needs to be protected
Consider what type of confidential information is included in the scope of the MSA and any additional specific information that needs to be protected
Agree on the duration that the confidentiality obligations need to be in place for
Make sure that the duration is reasonable for the type of confidential information and the length of time it needs to be protected
Include a provision in the MSA that outlines the obligations of both parties and the duration of the obligations

When you’ve established the scope and duration of the confidentiality obligations, you can check this step off your list and move on to the next step.

Defining the permitted uses of confidential information.

Identify the parties that will be sharing confidential information.
Define the types of confidential information to be shared.
Describe the permitted uses of that confidential information.
Specify any restrictions on the use of the confidential information.
Outline any obligations the receiving party must honor related to the use of confidential information.
Determine any third-party disclosure requirements related to confidential information.
Include details on how the receiving party must protect confidential information.

When all of the above points have been addressed, this step is complete and you can move on to the next step: Termination.

Termination

Identify and list the circumstances under which either party may terminate the agreement.
Include termination language that is clear, specific, and legally binding.
Address what will happen to confidential information after the agreement has been terminated.
Specify when either party can terminate the agreement and any associated repercussions.
Outline any required notice periods for termination.
Include a provision for a 30-day cure period if one of the parties breaches the agreement.
Make sure that all termination provisions comply with applicable laws and regulations.

You will know that you can check this off your list and move on to the next step once you have thoroughly reviewed and finalized the termination provisions in your Master Service Agreement.

Describing the circumstances under which either party may terminate the agreement.

Identify any grounds for termination that either party may invoke to terminate the agreement.
Specify any conditions or obligations that must be met before either party may terminate the agreement.
Outline the consequences of termination for both parties.
Include a clause that any obligations that have survived the termination of the agreement must be fulfilled.
Include a clause that allows either party to terminate the agreement in the event of bankruptcy or insolvency of the other party.

When you have completed the steps above, you can move on to setting out any applicable notice periods in the next step.

Setting out any applicable notice periods.

• Review the agreement to see if either party is required to provide notice of termination.
• If applicable, determine the applicable notice period for each party. This may be a fixed time period, or something more specific, like 30 days’ notice of termination.
• If necessary, negotiate the applicable notice period.
• Include the applicable notice periods in the agreement.
• Sign and date the agreement.

Once you have included the applicable notice periods in the agreement, you can move on to the next step of outlining any post-termination obligations.

Outlining any post-termination obligations.

• Draft the post-termination obligations for both parties, such as:
- Re-payment of any outstanding fees
- Return of any confidential information
- Destruction of any confidential information
• Ensure that the post-termination obligations are clearly defined and compliant with relevant laws
• Incorporate any additional post-termination obligations as mutually agreed upon by both parties
• When complete, review the post-termination obligations to ensure they are suitable for both parties
• When satisfied, you can check this off your list and move on to the next step - Dispute Resolution.

Dispute Resolution

• Identify the applicable laws and regulations that govern dispute resolution.
• Draft a dispute resolution clause that outlines the process for resolving any disputes that may arise between the parties.
• Consider any arbitration provisions that may be applicable.
• Include a clause that outlines the consequences of not resolving a dispute.
• When possible, include a clause that allows for out-of-court settlements.
• Obtain the necessary approvals from all relevant parties.

When you have completed all of the above, you will have successfully established a process for resolving disputes, including any applicable arbitration provisions.

Establishing a process for resolving disputes, including any applicable arbitration provisions.

Determine an appropriate process for resolving disputes, such as through negotiation and mediation, before considering the use of arbitration.
Draft an arbitration clause that outlines the circumstances in which the parties agree to use arbitration.
Consider the type of arbitration you will use, such as commercial, consumer, or international arbitration, and the applicable rules and procedures.
Include the names of the app