A Master Service Agreement (MSA) is the backbone of many business relationships—especially in industries like tech, consulting, creative services, and government contracting. It sets the rules of engagement for all future projects and statements of work (SOWs). But too often, businesses rush through MSAs without fully understanding the risks buried in the fine print.

In this blog, we highlight the 4 key clauses every MSA should include—and why they matter for protecting your company.

1. 🔐 Indemnity Clause: Who’s on the Hook?

An indemnity clause determines who pays if something goes wrong. If a third party sues over a data breach, IP infringement, or negligence, the indemnity clause spells out who must step in and cover the losses.

✅ Tip: Avoid overly broad “one-way” indemnity terms. Instead, use mutual indemnity where each party is responsible for its own misconduct. Tailor the language to fit the risk level of the services provided.

2. 💡 Intellectual Property (IP) Ownership: Who Owns What?

In service relationships involving creative work, software development, branding, or content creation, IP ownership is a major issue. If not addressed properly, you could lose control over the assets you paid to build—or worse, get sued for using them.

✅ Tip: Clearly define:

• Who retains ownership of pre-existing IP

• Who owns the deliverables created during the project

• Whether any rights are assigned or licensed
  This protects both parties and ensures no surprises later.

3. 🛑 Termination Clause: How to End the Relationship

Whether due to budget changes, delays, or non-performance, every MSA should define how and when it can be terminated.

✅ Tip: Include:

• Termination for convenience with notice period

• Termination for cause (e.g., breach or non-payment)

• What happens to fees, deliverables, and IP upon termination
  A clear exit strategy reduces litigation risk if the partnership goes south.

4. 💰 Payment Terms: Timing, Disputes, and Late Fees

Vague or one-sided payment terms are a recipe for cash flow issues and strained relationships. Your MSA should be crystal clear on pricing, invoicing, and payment expectations.

✅ Tip: Include:

• Payment schedules (e.g., net 30, milestone-based)

• Late payment penalties or interest

• Dispute resolution for billing issues

• Currency and tax responsibilities for international deals

🧾 Bonus: Other MSA Clauses to Consider

• Confidentiality

• Non-solicitation / non-compete

• Limitation of liability

• Force majeure

• Choice of law and venue

Why Legal Review Matters

MSAs can seem “boilerplate,” but one bad clause can cost your business thousands—or even jeopardize your IP. At [Your Law Firm Name], we help startups, service providers, and growing businesses draft and negotiate MSAs that mitigate risk, protect value, and build long-term trust.

📞 Need help reviewing or drafting your MSA?
Contact Shperun Law today for a flat-fee review or custom legal counsel.