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Professional Services Contract Services Agreement

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PROFESSIONAL SERVICES AGREEMENT

This Professional Services Agreement ("Agreement") is made effective as of by and between Client Name: , with principal place of business at Client Address: (hereafter "Client"), and Service Provider Name: , with principal place of business at Provider Address: (hereafter "Provider").

RECITALS

WHEREAS, Client desires to obtain from Provider certain professional services consisting of consulting, development, implementation and related deliverables as set forth in this Agreement; and

WHEREAS, Provider has the qualifications, experience and resources necessary to perform such services and desires to provide those services to Client under the terms and conditions contained herein; and

WHEREAS, the parties desire to set forth their respective rights and obligations with respect to the Services and Deliverables to be provided under this Agreement.

NOW, THEREFORE, in consideration of the mutual covenants and agreements set forth below, the parties agree as follows:

1. DEFINITIONS

1.1 "Services" means the professional services to be performed by Provider as described in Section 2 and any Statement(s) of Work executed pursuant to this Agreement.

1.2 "Deliverables" means tangible or intangible work product, reports, prototypes, software, documentation and other items to be delivered to Client pursuant to this Agreement.

1.3 "Acceptance" means Client's written approval of Deliverables in accordance with the acceptance criteria set forth in the applicable Statement of Work.

2. SCOPE OF SERVICES

Provider shall perform the Services and deliver the Deliverables described in the following statement of work and any subsequent work orders mutually executed by the parties. Provider shall perform the Services in a professional and workmanlike manner, using personnel of required skill and experience.

3. STATEMENT OF WORK; CHANGES

All Services shall be detailed in one or more Statements of Work ("SOW") that describe tasks, deliverables, schedules, acceptance criteria and pricing. Any change to an SOW that affects price, schedule, or scope must be set forth in a written change order signed by authorized representatives of both parties.

4. TERM; TERMINATION

This Agreement commences on the Effective Date and continues until completion of the Services or termination as provided herein. The initial term begins on and is scheduled to end on unless earlier terminated.

Either party may terminate this Agreement for convenience upon written notice provided at least days prior to the intended termination date. Either party may terminate immediately for material breach that remains uncured for thirty (30) days following written notice of such breach.

5. COMPENSATION AND PAYMENT

Client shall pay Provider compensation in accordance with the pricing set forth in the applicable SOW. Unless otherwise specified, Provider shall invoice Client for Services rendered and Client shall pay invoices within calendar days of receipt.

All fees are exclusive of taxes; Client shall be responsible for sales, use, value added and other taxes levied on the Services, except for taxes based on Provider's net income.

6. EXPENSES

Provider will be reimbursed for reasonable, preapproved out-of-pocket expenses incurred in connection with performing the Services. Provider shall submit receipts or other supporting documentation with expense invoices. Expense reimbursement is subject to an aggregate cap of unless otherwise agreed in writing.

7. INDEPENDENT CONTRACTOR

Provider is an independent contractor and shall have no authority to bind Client. Nothing in this Agreement creates an employment, agency, partnership or joint venture relationship between the parties.

8. CONFIDENTIALITY

Each party shall protect the other's Confidential Information with at least the same degree of care it uses to protect its own confidential information but in no event less than reasonable care. Confidential Information received under this Agreement shall not be disclosed to third parties except as permitted by this Agreement or required by law.

9. INTELLECTUAL PROPERTY

Unless otherwise agreed in an SOW, Provider hereby assigns to Client all right, title and interest in and to the Deliverables created specifically for Client under this Agreement, subject to payment in full. Provider retains ownership of Provider's pre-existing materials, tools, methodologies and know-how, provided that Provider grants Client a nonexclusive license to use any incorporated pre-existing materials embedded in the Deliverables to the extent necessary for Client's intended use.

I acknowledge assignment of Deliverables to Client

10. REPRESENTATIONS; WARRANTIES

Each party represents and warrants that it has the authority to enter into this Agreement. Provider warrants that the Services will be performed in a professional and workmanlike manner consistent with industry standards for a period of ninety (90) days following delivery. EXCEPT AS EXPRESSLY PROVIDED HEREIN, PROVIDER DISCLAIMS ALL OTHER WARRANTIES, EXPRESS OR IMPLIED.

11. INDEMNIFICATION

Provider shall indemnify, defend and hold Client harmless from and against any third-party claims arising out of Provider's negligent acts, willful misconduct, or material breach of this Agreement. Client shall indemnify Provider for claims arising from Client's misuse of the Deliverables or violation of applicable law.

12. LIMITATION OF LIABILITY

EXCEPT FOR LIABILITY ARISING FROM A PARTY'S GROSS NEGLIGENCE, WILLFUL MISCONDUCT, OR INDEMNIFICATION OBLIGATIONS, IN NO EVENT SHALL EITHER PARTY'S AGGREGATE LIABILITY ARISING OUT OF OR RELATED TO THIS AGREEMENT EXCEED THE TOTAL FEES PAID OR PAYABLE BY CLIENT TO PROVIDER FOR THE SERVICES GIVING RISE TO THE CLAIM DURING THE TWELVE (12) MONTHS PRECEDING THE CLAIM.

13. INSURANCE

Provider shall maintain insurance coverage sufficient to cover its liabilities under this Agreement and shall provide certificates of insurance upon Client's request.

14. NOTICES

All notices shall be in writing and delivered to the addresses set forth below or to such other address as a party designates in writing. Notice is effective upon receipt.

15. AMENDMENTS; WAIVER

No amendment, modification, or waiver of any provision of this Agreement shall be effective unless in writing and signed by authorized representatives of both parties. The failure of either party to enforce any right shall not constitute a waiver of that or any other right.

16. ASSIGNMENT; COUNTERPARTS

Neither party may assign this Agreement without the prior written consent of the other party, except that either party may assign this Agreement in connection with a merger, acquisition, or sale of substantially all of its assets. This Agreement may be executed in counterparts, each of which shall be deemed an original and all of which together shall constitute one instrument.

17. GOVERNING LAW; SEVERABILITY; ENTIRE AGREEMENT

This Agreement shall be governed by and construed in accordance with the laws of the State of without regard to conflict of laws principles.

If any provision of this Agreement is held invalid or unenforceable, the remaining provisions shall remain in full force and effect. This Agreement, together with all SOWs, constitutes the entire agreement between the parties and supersedes all prior and contemporaneous agreements, proposals and communications regarding its subject matter.

Client Name:

By:

Date:

Service Provider Name:

By:

Date:

Enter text✕

What the Professional Services Contract Services Agreement Covers

A Professional Services Contract Services Agreement is a written contract that defines the relationship between a service provider and a client for discrete professional work. It typically identifies parties, describes scope of work and deliverables, sets payment and invoicing terms, allocates intellectual property and confidentiality rights, and establishes termination, indemnity, and dispute resolution provisions. The agreement provides a single reference point for expectations, reduces ambiguity about responsibilities, and serves as the enforceable record of the parties' rights and obligations throughout the engagement.

Why a Clear Professional Services Contract Matters

A clear Professional Services Contract Services Agreement reduces disputes, clarifies payment and delivery expectations, and preserves legal remedies. Properly drafted terms protect both parties, document consent, and support enforceability under federal and state e‑signature laws such as the ESIGN Act (15 U.S.C. §7001) and UETA where applicable.

Why a Clear Professional Services Contract Matters

Who Typically Uses This Agreement

The Professional Services Contract Services Agreement is used by organizations and individuals who engage external professionals for time‑limited or project‑based work.

  • Independent consultants and freelancers who deliver defined services and need clear payment and IP terms.
  • Agencies and professional firms engaging subcontractors or vendors for client projects and deliverable timelines.
  • Corporate procurement, project managers, and legal teams standardizing vendor relationships and compliance obligations.

It is suitable for both one‑off engagements and ongoing retainer arrangements and is commonly adapted by industry and role.

Core Elements to Include in the Agreement

These six elements form the backbone of a robust professional services contract and should be tailored to the engagement.

Scope of Work

Describe tasks, deliverables, acceptance criteria, and any milestones. Narrow, specific scope reduces disputes over omitted or extra work and enables measurable acceptance testing.

Deliverables

List tangible outputs, formats, delivery dates, and approval process. Tie payments to milestone acceptance and include remedies for rejected work to protect both parties.

Payment Terms

State fees, invoicing cadence, payment window, late fees, and expense reimbursement. Identify currency and method (ACH, check, card) to avoid payment delays.

Timeline

Include start date, critical milestones, and completion or renewal terms. Address delays, extensions, and force majeure to allocate schedule risk.

IP and Confidentiality

Specify ownership of work product, license grants, and confidentiality obligations. Consider assignment language for ‘work made for hire’ and carve outs for preexisting IP.

Termination & Remedies

Define termination for convenience and for cause, notice periods, post‑termination obligations, and dispute resolution (mediation, arbitration, jurisdiction).

Essential Data Fields at a Glance

Effective Date: MM/DD/YYYY
Party Legal Names: Full registered entity names
Contact Details: Street, city, state, ZIP
Payment Schedule: Net terms and invoice frequency
Scope Identifier: Deliverable list or exhibit number
Signature Blocks: Name, title, date required

Step‑by‑Step: Completing the Agreement

Follow these steps to prepare, review, and finalize a Professional Services Contract Services Agreement so it reflects the parties' intent and legal requirements.

  • 01
    Draft Core Terms: Define scope, price, schedule, IP, and termination.
  • 02
    Attach Exhibits: Include SOWs, pricing tables, and technical specs.
  • 03
    Review & Negotiate: Confirm responsibilities, compliance, and tax implications.
  • 04
    Execute Legally: Collect signatures, dates, and any required notarization.

Configure an Online Signing Workflow

Set up a digital workflow to guide signers, reduce errors, and preserve an audit trail before sending the agreement for signature.

Field Configuration
Authentication Email link or SMS code; stronger KBA optional
Notifications Automatic reminders and expiration notices
Templates Create reusable template with locked clauses
Conditional Fields Show fields only when certain options selected

Where to Send and How to File Executed Agreements

Decide distribution and retention routes to ensure each stakeholder and recordkeeper receives a compliant copy of the executed agreement.

  • Client Distribution: Send final signed PDF to client contacts and accounts payable
  • Internal Filing: Store master copy in company contract repository or CLM
  • Project Systems: Attach signed agreement to project or ticket records
  • Tax & Finance: Provide signed copy to accounting for 1099 reporting

Technical Considerations for eSignature and Distribution

Confirm file formats, authentication, and integrations before sending the agreement to signers.

  • File Formats: PDF or DOCX recommended
  • Authentication: Email, SMS, or stronger methods
  • Integrations: CRM, NetSuite, Google Workspace

Typical Deadlines and Compliance Dates

Key timing items affect payments, tax reporting, renewals, and suspension rights; track these dates when negotiating and administering the contract.

Invoice Payment Deadline:

Commonly Net 30 from invoice date; adjust as negotiated

Milestone Due Dates:

Specify calendar or business day deadlines for deliverables

Renewal Notice:

Require written notice 30–60 days prior to renewal

1099‑NEC Reporting:

Form 1099‑NEC to contractors and IRS by Jan 31 (IRC §6721)

Recordkeeping:

Retain executed agreements per retention schedule

Common Mistakes to Avoid

  • Vague scope or deliverables that trigger scope‑creep disputes and unpaid work claims.
  • Missing or inconsistent payment terms that delay invoicing and complicate collections.
  • Failure to specify IP ownership or license scope, creating later ownership disputes.
  • Not preserving an unalterable signed record and audit trail for enforcement.

Potential Penalties and Legal Risks

Late Tax Filing: Penalties $60–$330 per form (IRC §6721)
Breach Damages: Monetary damages and indemnity exposure
Invalid Signature: Risk of non‑enforceability if formalities unmet
I‑9 Noncompliance: Fines $281–$2,789 per violation (8 CFR §274a.2)
Data Breach: HIPAA or state breach obligations and penalties
Late Payments: Interest, collection costs, and relationship harm

Typical eSignature Pricing and Feature Comparison for Contract Execution

Vendor pricing and feature availability vary; signNow appears first below followed by common alternatives to consider for executing Professional Services Contract Services Agreements.

signNow DocuSign Adobe Sign PandaDoc HelloSign
Starting Price $8/user/mo $15/user/mo $14/user/mo $19/user/mo $15/user/mo
Free Trial 7‑day free trial, no card Varies by vendor Varies by vendor Varies by vendor Varies by vendor
Bulk Send Yes Yes Yes Yes No
Audit Trail Yes Yes Yes Yes Yes
HIPAA Compliant Yes Yes Yes No No

Real Examples of Contract Use in Practice

These brief case arcs show how organizations apply a Professional Services Contract Services Agreement in real workflows and the outcomes achieved.

Optica Ventures — Brian Fitzgibbons

Optica standardized its engagement contracts to reduce negotiation time and clarify deliverables.

  • The team used a template with milestone payments linked to acceptance.
  • After standardizing, Optica reported fewer disputes and faster invoicing, enabling predictable cash flow and simplified project administration.

Fertility Centers of Illinois — John Butler

A healthcare provider adopted standardized service agreements across clinics to ensure consistent patient data handling.

  • Agreements included HIPAA addenda and BAA clauses.
  • This approach reduced legal review cycles, improved compliance posture, and provided clear vendor responsibilities for protected health information handling.

How to Update or Amend an Existing Agreement

Use a controlled amendment process to ensure changes are authorized, documented, and enforceable.

01

Identify Change:

Describe the amendment purpose and affected clauses
02

Draft Amendment:

Prepare a succinct amendment document or revised exhibit
03

Obtain Approvals:

Secure internal sign‑off before sending to counterparty
04

Execute:

Collect dated signatures from authorized representatives
05

Distribute:

Send executed amendment to records and finance
06

Archive:

Store amendment with original contract and audit trail

Frequently Asked Questions About Execution and Validity

Answers to common questions about electronic execution, enforceability, and practical steps to resolve signature or record issues.


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