SaaS contract checklist for buyers

Use this with the order form, the master agreement and any linked terms open side by side. Software contracts are often several documents stacked together, and the order form usually wins when they disagree. Check that it says so.

None of this replaces your own counsel. It is a list of places to look, not a list of what you should insist on, and vendors differ in what they will move on. Unfamiliar words are defined in the pricing terms glossary.

Before you read the clauses

• Confirm which documents make up the deal: order form, master agreement, data processing terms, acceptable use policy, service levels.
• Find the order of precedence. If two documents conflict, which one controls?
• Check for terms that live behind a link and can change. Ask whether the version you saw is the version that applies.
• Note who the contracting entity is and which country’s law governs.

Term and renewal

• Write down the start date, the length of the initial term and the length of each renewal.
• Find out whether the contract renews automatically. If it does, find the notice period and who it must be sent to.
• Put the notice deadline in a shared calendar with a reminder at least 90 days ahead, longer for large contracts.
• Check whether notice must be in writing, and whether an email counts.
• Look for a termination for convenience right, and what you owe if you use it.

Seats and usage

• Confirm exactly what a seat is: a named person, a concurrent session, a device, a role.
• Check whether seats can be reassigned when someone leaves, and whether that is immediate.
• Find the rule for adding seats mid-term: price, co-terming and minimum add.
• Find the rule for removing seats. Many contracts allow additions at any time and reductions only at renewal.
• Check whether usage limits exist beyond seats, such as records, storage, API calls or messages, and what happens past them.
• Ask how overage is billed, and whether you are warned first.

Price and payment

• Check whether the price is fixed for the initial term, and what is said about renewal pricing.
• If there is a price increase clause, look for a cap, a formula or an index it follows.
• Look for any language that lets the vendor change fees on notice.
• Confirm billing frequency, payment terms, currency and who pays taxes.
• Check for late-payment consequences, including suspension, and the notice required first.
• Ask whether discounts are tied to a committed term or volume, and what happens to them if you reduce.

Service and support

• Find the uptime commitment and how it is measured.
• Check what the remedy is when the vendor misses it. Credits you must claim within a short window are common.
• Look at support hours, response targets and the channels included in your plan.
• Ask what notice you get before features are retired or plans restructured.

Data and security

• Confirm that you own your data, and that the vendor may use it only to provide the service.
• Check what the vendor says about subprocessors and how you are told when they change.
• Ask for the security documentation your company requires and note its date.
• Find the breach notification obligation: who tells you, how fast, and what they must include.
• Check where data is stored, if that matters to your customers or regulators.

Exit

• Find how you get your data out, in what format, and for how long after the contract ends.
• Check whether export is included or charged.
• Look at what happens to your data afterwards, and whether deletion is confirmed in writing.
• Ask what happens to your account if the vendor is acquired or ends the product.

Liability and other terms

• Read the limitation of liability. Note the cap, and what is carved out of it.
• Check the indemnity for intellectual property claims against the product.
• Look at assignment: can the vendor transfer the contract, and can you if your company is sold?
• Note the dispute process and the governing law.

Before you sign

• Have whoever will administer the tool read the seat and usage sections.
• Have finance read the price, payment and renewal sections.
• Record the signed version, the renewal date and the notice deadline in one place others can find.
• Set up a review at six months to compare seats paid with seats used. The seat usage audit gives a method.

When the renewal comes round, negotiating a renewal picks up where this list ends.