Software Development Agreement

Brenda Peterson Brenda Peterson
How To Use

This review list is provided to help you complete this Software Development Agreement.  Software development is still a largely immature market full of pitfalls and perils for both the publisher, the Buyer in this case, and the End-User, not applicable in this Agreement. 

No other industry to our knowledge, for example, willfully has able bodied and competent experts issuing bugs and viruses just for the pure pleasure of it. Therefore, the Buyer of software and software development must be especially careful when entering into contracts with Developers. 

Developers, on the other side of the equation, often are deeply suspicious of publishers so, in a similar manner, are wary in their dealings with them.  As with all of our legal forms and business advice, our role is to guide you with regard to the practical business matters and not give legal advice per se. 

Therefore, our business advice is, that no matter which side of this equation you are on, beware of these activities and be scrupulous about your conduct in order to have the relationship go smoothly in an industry that runs anything but smoothly.  

  1. Be sure both parties sign the Agreement prior to commencing work.  Be sure all monies are clear.  We advise that Buyers provide some deposit as a good faith gesture since most developers need the funds to operate and live.  We also suggest that Buyers be aware that any repair work, whether on a house or a software program, can discover unanticipated problems. 

    It is important for the long-term survival of the software that the Buyer permit the Developer to reveal candidly any flaws uncovered in the software so it may be addressed.  Punishing the bearer of bad tidings is a distinctly self-destructive act by many publishers.  

  2. Time pressure placed upon Developers, plus ill-defined missions, has led to much bad and buggy software being sold and released to make artificial deadlines.  Further compounding this problem, most Developers refuse to outline, blue print, and otherwise prepare their activities prior to commencing actual coding. 

    Both of these tendencies, very uncommon in most established consumer product industries, lead to misunderstandings, financial problems for the participants, end-user unhappiness, and so on and so on. 

    Whether you are the Developer or the Buyer, you can help improve this situation in this Agreement by not putting undue time pressures on projects, defining in outlines and blue prints what the product should do, and provide sufficient time for Q & A to resolve problems.  As they say in carpentry, “Measure twice; cut once.”

  3. Print at least two copies of this Agreement because, especially for the Buyer, this document relates to your ownership rights to the software in question. 

    You should keep a copy in your corporate records as well as with the software worked upon.  Well-documented ownership trails almost always become a major issue at some point in the software business.  Keeping a good audit trail will save your corporation time and money in the long term. 

    The Developer is advised to keep copies for marketing purposes in the future; while you may not be able or want to disclose the exact document, you can get a letter of commendation, if possible, from the Buyer at the end of the project.  This can be a very helpful sales tool with potential buyers in a turbulent market (and we say that as a buyer ourselves)!

software development agreement template