Free Software as a Service Agreement Template

Creating or signing a Software as a Service (SaaS) agreement for your company or business can be exhausting. These agreements can be challenging to understand, let alone manage if you have never dealt with a SaaS contract before. Each of the numerous components that make up a SaaS agreement or contract is essential to safeguarding your business's intellectual property.

Understanding the SaaS agreement’s terms and components is simpler when you break it down. From this article, you will know what SaaS contracts are, the important components of SaaS agreements, and the benefits of having an agreement template to draft your contracts.

What is Software as a Service Agreement?

A Software-as-a-Service (SaaS) agreement or SaaS contract is drawn when a software service provider agrees to offer their services to a customer. The customer can be a freelancer, solopreneur, small and medium business owner, or large corporates. From this agreement, the end user or the involved party will come to know the terms and conditions regarding their control and access to the software. It will also outline the subscription service and payment model adopted for the SaaS product. 

SaaS agreements include complex legal material. Drafting an all-inclusive agreement can be tricky, hence it is always advisable to use a comprehensive legally vetted SaaS agreement template for your business.

Perks of having SaaS agreements

A SaaS agreement is a document that details the involved parties' obligations and performance goals. Not only can a software company profit from a well-structured SaaS agreement, but it may also assist all parties in finding common ground on a variety of issues.

A SaaS agreement serves as a how-to guide for the SaaS provider to organize their business. Here are some advantages of using a SaaS agreement:

• Helps companies avoid legal issues

• Protects the rights of both the company as well as customer party involved in the SaaS contract 

• Accelerates the negotiation process

• Reduces the risk of litigation

• Potential issues are identified and resolutions are outlined clearly in these contracts

• Both parties are held responsible for data protection 

Having an all-inclusive SaaS contract gives a competitive edge to the users or customers as well. It gives a clear roadmap on: 

• The restrictions on the use of the service provider’s product 

• What steps to take and how to act in the event of a data breach

• Fees involved while opting for a service provider’s subscription model

• Legal obligations as a user

• Termination policy upon any dispute, etc.       

A well-written SaaS contract serves as a template for other contracts.

Purpose of having a template to draft SaaS Agreements

SaaS agreements are key to forming and building long-standing partnerships between you and potential customers. It is essential for establishing credibility and disseminating information to potential users. While handling something of this importance, you must have a legally binding contract that safeguards you from disputes and sets the expectations clear for both the customer and the SaaS provider right from the beginning.

However, clearly defining the business relationship between the two parties that details the pricing, deliverables, timelines, and other pre-agreed items relevant to the software product and services is not easy. If you miss out on any information or structure the terms in any different way, it could lead to further confusion and misunderstandings between the company and its customers. By having clearly defined SaaS agreement terms and conditions in a templatized format, the job not only becomes easy and effective but also legally sound too. Let’s look at some of the advantages of a predefined template below:

1. Simplifies the process of creating single and bulk agreements or contracts

A SaaS agreement needs to cover many crucial aspects such as: 

• Agreement terms

• Description of services

• Provisions for support and maintenance

• Termination policy

• Clauses related to how to use customer data and other personal information

• Terms on retaining proprietary and intellectual property (IP) terms

• Limitation of liability, and many more. 

While drafting such an intricate document, there are chances that you complicate all the information and end up confusing your customers. But, with a well-formulated template, you can circumvent this issue. It offers legal and reasonable dispute resolution to the IT solution provider and their users.

2. Using templates ensures consistency and clarity 

Separate SaaS agreements for various customer needs are typical practices for SaaS organizations. It is possible to omit crucial information or make mistakes while writing SaaS agreements from scratch. However, utilizing SaaS agreement templates guarantees uniformity in your communications and ensures that the document is error-free.

3. Easy to customize  

A SaaS contract contains certain moving components. With respect to each agreement, the sections outlining governing laws, pricing information, the number of arbitrators involved, etc. can change. Because templates are customizable and simple to use, users may easily make these edits on each page of their document to meet their needs.

4. Prevents legal complications arising from intellectual property rights (IPR)

Legal clauses can get tricky for a SaaS agreement. Any modifications or improvements made to your software system can result in new intellectual property and who owns the rights. A template gives you the luxury to leverage its well-drafted legal/law framework and build on it further. This way, you can save some effort and avoid any legal challenges arising from it prior.  

Essential components of a SaaS contract template  

While SaaS agreements will vary according to your business and the services provided, the following components are crucial to any SaaS contract:

Introduction

Your SaaS agreements should start with the basics. In this part of the contract give a brief introduction about your company, customer details, respective addresses, date, and subscription plan details, etc. 

Terms of the Agreement

This section should be written carefully. It is under this part, as service providers you have complete control over the end user and how they should be using your services. Let’s see what are the different customer and service provider obligations from the subsequent sections: 

1. Definitions 

Most SaaS agreements and contracts are long and can often turn confusing. To avoid such complications, begin the document with crisp and clear definitions of the terminologies used in the contract. For example in the contract, start by defining what following terms are:

• Customer content - Refers to all relevant customer data including all text, sound, video or image files, and software, that are provided by a customer to the company for the SaaS services.

• Documentation - The written or electronic release notes, user guides, online help, training materials, and other published technical documentation about the applicable service provided by the company to a customer together with access to the service.

• Order - It means any ordering document between a customer and the company that specifies the service being purchased.

• Schedule - The timeline obligations to be followed by the service provider company to the customer. 

• Services - Refers to the company's obligations to the customer regarding access to and use of the software products hosted by the company. It includes any documentation, updates, upgrades, support, and content that the customer has subscribed to under the relevant Order.

• Subscription or renewal term - It is the period specified in a Schedule during which the customer shall have access to software for use and operation through the company’s SaaS services.

The above-mentioned business terms are mere references. As per your SaaS contract, you can add and customize this section with your set of definitions. Otherwise, seek the guidance of a subject matter expert prior to finalizing the content in your SaaS contracts.

2. License grant

Herein, mention to the end users the license rights to the services provided as per the agreement.

3. Customer responsibilities

This part states the responsibilities that should be followed by the customer. For instance, customers should agree upon the applicable law of the land, take full ownership of the usage guidelines, stick to the stipulation mentioned in the service license, etc.

4. Ownership and restrictions

Here, you have to explain how the customer company should handle the intellectual property rights, how the software company should manage confidential information, what kind of ownership and restriction each party has to follow for the services, etc.

5. Orders and payments

In the orders section, you need to inform users about how much they need to pay for the ordered services, when, and how. It also addresses the frequency of the billing cycle as per the SaaS subscription. 

The payment part should also mention the fees for the SaaS product’s maintenance, upgrades, and other support services. It will include a payment schedule and details on how the customer agrees to pay (mode of payment). Generally, SaaS companies offer monthly, annual, or one-time subscription options. Semi-annual and multi-year billing are also possibilities.

6. Term and termination

In the terms section, specify the conditions when the contract remains valid and when they can mutually end it.  

Sometimes an agreement can end before the services have been completed. Termination can happen because of many reasons such as timelines not being met by the developer, poor quality of the software, the company not providing assured support for the services, and more. Either party to the agreement can terminate the agreement upon written notice. 

7. Service level agreement

SaaS service-level agreements or SLAs clearly define the services a company provides and how its customers should utilize or access them. The terms and conditions for hosting the SaaS software, the support and maintenance services required, exclusions for which the SaaS provider will not be obligated, etc. should be mentioned here.

8. Warranties

A warranty is a promise or guarantee made by the service provider about the performance or quality of the software services provided. They should mention all things they will be responsible for in their offering.

9. Limitations of liability

A limitation of liability agreement shields SaaS vendors from risk by contractually prohibiting end users/customers from suing them for specific damages. For instance, it becomes difficult for your business to recover damages from the SaaS service company, if the software fails and causes harm. Basically in this section, you have to mention the ultimate amount of damages that a vendor party might possibly be responsible for under the agreement. 

10. Indemnification

Indemnification in general is a party's promise to hold another party legally blameless—or not accountable—for possible breach or damages in an agreement. So in this section, you shall mention in detail exactly what kind of breach or losses are not liable in the service contract.

11. Confidentiality

This part of the template states the software company’s surety to keep the customer data, trade secrets, confidential information, and other personal data of the customer private and not to divulge any details to any third parties. Here, the software service provider also acknowledges that the customer/client information will only be utilized for business needs. In return, the customer also promises to retain all the company-related service data and other confidential information within their business, even after the termination of the SaaS contract.   

12. Arbitration

Arbitration is like an out-of-court dispute resolution where an impartial third party, known as an arbitrator, hears evidence and provides a binding ruling. Any disputes between the parties resulting from or connected to the SaaS contracts are resolved in accordance with this provision.

13. Miscellaneous

It contains all other terms and conditions related to the contract and checks out all the compliance in terms of:

• Governing law and jurisdiction

• Modification

• Force majeure

• Severability and more

Acceptance and signatures

If either party or all the parties involved in the SaaS contract are in agreement with the conditions mentioned in their SaaS agreement document, then they can readily accept and sign it. It further makes the contract legally valid.   

With Revv’s SaaS Agreement Template create all-inclusive agreement documents for your business

A SaaS agreement or contract is an integral part of any company providing SaaS services. This piece of the document provides an accountable framework for the services to be provided to your potential customers. If you want to attract potential clients, your SaaS contract needs to stand out and should be precise and clear in putting across the right message.

With Revv's editable SaaS agreement template, you can design engaging contracts more quickly and efficiently.     

Personalize the entire agreement document 

Revv’s template can be completely customized to your needs with the help of the document editor. With a simple drag-and-drop feature, you will be able to add images, text, tables, integrate payment systems, and more. For any client of yours, you can easily create single and multiple contracts using the same template.

Stress-free approval and review process

SaaS agreements contain a lot of legal information as well as other confidential data in it. Oftentimes these documents need to be thoroughly vetted and approved by the SaaS company’s team head or manager before sending them to customers for signatures. 

With Revv you are in complete control of the review and approval system. You can send any SaaS agreement to the approval manager or other team members for their review and approval using the Check and send for internal approval feature. 

Efficient and real-time collaboration with teammates

While creating multiple SaaS agreements on a daily basis, mistakes may happen if you have given the wrong information or customer data, addressed to the wrong company, or have used an old agreement template with old service fees, etc. Avoid all these human errors and make your SaaS contracts error-free with the Notes feature. It is a real-time collaboration feature provided by Revv. If you want your SaaS contracts to be thoroughly reviewed by your peers, you can simply tag your colleague with @mentions. The tagged person will receive an email notification for the same. 

Access your SaaS agreements from anywhere

You can access your SaaS contracts anytime, anywhere, and from any device since Revv is a cloud-based document management and eSign platform. 

eSignatures that follow all compliance measures 

Revv makes your software service agreements legally binding with its bank-grade eSignatures. It follows all local and global laws such as ESIGN Act, UETA, and eIDAS, among others. 

In the event of any breach, both the company and the customer party are anxious about their personal data. With Revv, data protection takes the utmost priority. Hence, our compliance and security checks are further strengthened with Amazon Web Services Server-Side Encryption (AWS SSE-S3), and certified with AWS global cloud certification – such as Cloud Security Alliance Controls (CSA), SOC 1: Audit Controls Report (SOC 1), SOC 2: Security, Availability & Confidentiality Report (SOC 2), and ISO 27001 Security Management Controls. 

Real-time activity tracking   

With Revv, you can track real-time activity for all your SaaS documents from the Activity tracking feature.  

Instant notifications

Revv sends auto-generated email notifications to both the sender (software service company) and recipients (customers) notifying them of the actions to be taken on the service agreement document.  

Legally binding audit trails

When your company is handling multiple contract documents, you need to be cautious about legal responsibilities. To avoid complexities involved in the backtracking of SaaS agreement documents or any unfortunate event leading to legal suits, Revv generates an electronic copy of audit trails in the form of an Evidence Summary for all eSigned agreement documents. 

Evidence Summary is a digital certificate that chronologically records each action taken during the signing process of the service document. It includes – the signer’s information, the date and time stamp of each action taken by the signer, the IP address of the signer, and other details that act as legal proof. A user can download the certificate for free.  

Using Revv platform entitles you to these benefits and many more. Stop thinking and start using Revv right away!  

Frequently asked questions

What is a software as a service agreement?

A software as a service (SaaS) agreement is a legally binding document entered between a SaaS provider and its customers. In this document, the company clearly specifies the terms and conditions to be followed by the end user. The agreement also provides clear guidelines to manage subscriptions and payments. 

What is a SaaS service level agreement?

SaaS service-level agreements or SLAs define the services a software company provides and how its customers should utilize or access them. The terms and conditions for hosting the SaaS product, support, and maintenance, IPR and ownership rights, etc. are included in the service-level agreement. 

What is the difference between a SaaS and a license agreement?

Saas Agreement - Software is accessible on a hosted platform in an intangible form where the data is stored and protected by the SaaS provider. 

License Agreement - Software is available in a physical form as CD-Roms or where the data is stored within the end user’s system.

What should I look for in a SaaS agreement?

In a SaaS agreement, you should look for - Details about the usage of the software, Billing and payment details, Privacy of your data and confidentiality clauses, Intellectual property rights and ownership, and Renewal & termination policies.