The Service Agreement Term Sheet is commonly used when parties wish to document the essential terms of a service arrangement before proceeding with full contractual documentation. It provides a structured framework for negotiating and agreeing on fundamental aspects of the service relationship, including scope, pricing, duration, and key obligations. Under English and Welsh law, while not typically legally binding (except for specific terms like confidentiality), it serves as an important reference point for drafting the final agreement and helps ensure alignment between parties on crucial commercial and operational terms.
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1. Parties: Identification of contracting parties and their registered offices/addresses
2. Background: Context of the agreement and high-level description of services to be provided
3. Definitions: Key terms and their meanings used throughout the document
4. Services: High-level description of services, delivery requirements, and service provider obligations
5. Fees and Payment: Payment terms, fee structure, invoicing, and payment schedule
6. Term and Termination: Duration of agreement, renewal terms, and termination rights
7. Liability and Indemnities: Limitation of liability, indemnification obligations, and insurance requirements
8. Confidentiality: Protection of confidential information and trade secrets
9. General: Standard boilerplate provisions including governing law, notices, and entire agreement
1. Service Levels: Performance metrics, KPIs, and remedies for failure to meet service levels - include for complex service arrangements
2. Change Control: Process for requesting and implementing changes to services - recommended for long-term arrangements
3. Data Protection: GDPR compliance and data processing obligations - required when personal data is processed
4. Intellectual Property: IP ownership, licenses, and protection - include when IP is created or used in services
5. Personnel: Key personnel requirements, vetting, and replacement - relevant for service provider staff working on client premises
1. Schedule 1 - Service Description: Detailed specification of services, methodologies, and deliverables
2. Schedule 2 - Charges: Detailed pricing structure, rate cards, and payment milestones
3. Schedule 3 - Service Levels: Detailed performance metrics, measurement methods, and service credits
4. Schedule 4 - Change Control Procedure: Detailed process for change requests, impact assessment, and implementation
5. Schedule 5 - Key Personnel: List of key personnel, their roles, and qualifications
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