Software Development Outsourcing Contract Template

Introduction
Outsourcing software development has become a strategic move for companies aiming to leverage external expertise, reduce costs, and accelerate time-to-market. A well-drafted contract is essential to ensure both parties have clear expectations and understand their obligations. This template provides a comprehensive framework for a software development outsourcing agreement.

1. Definitions
1.1 Client: The party engaging the services of the Service Provider.
1.2 Service Provider: The entity providing software development services to the Client.
1.3 Project: The software development work described in the Statement of Work (SOW).
1.4 Deliverables: The outputs produced by the Service Provider, including but not limited to software code, documentation, and reports.
1.5 Intellectual Property: All patents, copyrights, trademarks, trade secrets, and other intellectual property rights related to the Project.

2. Scope of Work
2.1 Services: The Service Provider agrees to perform the services described in the SOW.
2.2 Changes: Any changes to the Project scope must be documented in a Change Order and approved by both parties.
2.3 Exclusions: Services not explicitly mentioned in the SOW are not included in the scope.

3. Project Management
3.1 Project Manager: Each party will appoint a Project Manager to oversee the Project.
3.2 Meetings: Regular meetings will be held to discuss Project status, issues, and progress.
3.3 Reports: The Service Provider will submit progress reports according to the schedule outlined in the SOW.

4. Deliverables
4.1 Specifications: Deliverables must meet the specifications outlined in the SOW.
4.2 Acceptance: The Client will review and accept Deliverables within a specified time frame.
4.3 Revisions: If Deliverables do not meet the agreed specifications, the Service Provider will make necessary revisions at no additional cost.

5. Payment Terms
5.1 Fees: The Client agrees to pay the Service Provider as outlined in the SOW.
5.2 Invoicing: The Service Provider will issue invoices according to the payment schedule.
5.3 Payment: Payments are due within a specified period from the date of invoice.

6. Confidentiality
6.1 Obligations: Both parties agree to keep all confidential information disclosed during the Project confidential.
6.2 Exceptions: Confidentiality obligations do not apply to information that is publicly known or required to be disclosed by law.

7. Intellectual Property Rights
7.1 Ownership: All Intellectual Property developed during the Project will be owned by the Client, unless otherwise agreed.
7.2 License: The Service Provider grants the Client a perpetual, royalty-free license to use any pre-existing Intellectual Property incorporated into the Deliverables.

8. Warranties and Disclaimers
8.1 Warranties: The Service Provider warrants that the Deliverables will be free from defects and will conform to the specifications in the SOW.
8.2 Disclaimers: The Service Provider makes no other warranties, express or implied, regarding the Deliverables.

9. Term and Termination
9.1 Term: The agreement will commence on the Effective Date and continue until the Project is completed or terminated.
9.2 Termination: Either party may terminate the agreement for cause or convenience with written notice.
9.3 Consequences: Upon termination, the Service Provider will deliver any completed Deliverables and the Client will pay for all work performed up to the termination date.

10. Dispute Resolution
10.1 Negotiation: Disputes will first be addressed through negotiation between the parties.
10.2 Mediation: If negotiation fails, disputes will be resolved through mediation.
10.3 Arbitration: If mediation fails, disputes will be resolved through arbitration.

11. Miscellaneous
11.1 Governing Law: The agreement will be governed by the laws of the jurisdiction specified in the SOW.
11.2 Amendments: Any amendments to the agreement must be in writing and signed by both parties.
11.3 Entire Agreement: The agreement constitutes the entire agreement between the parties and supersedes all prior agreements.

Appendix A: Statement of Work
A detailed description of the Project, including objectives, timelines, deliverables, and milestones.

Appendix B: Payment Schedule
A schedule outlining payment terms, including amounts and due dates.

Conclusion
A well-structured outsourcing contract is crucial for successful software development projects. This template provides a solid foundation for creating a comprehensive agreement that outlines the roles, responsibilities, and expectations of both parties involved.