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Master Services Agreement (MSA) Template (Free, US)

A master services agreement (MSA) is a framework contract that sets the legal terms for an ongoing services relationship, so that each new project needs only a short statement of work (SOW) or order. Below: what an MSA does, how it fits with SOWs, the clauses that matter most, a free sample you can copy into Word, common mistakes, and how to draft or review an MSA in Word with LexDraft.

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Last checked: 22 October 2026. This page is general information about United States practice, not legal advice. Contract law is state law and varies. Treat the sample as a starting point and have a lawyer licensed in the relevant state review the agreement before use.

What a master services agreement is

An MSA sets the terms that apply to every piece of work one party (the provider) does for another (the customer) over a period of time: payment terms, ownership of work product, confidentiality, warranties, indemnities, limits on liability, termination and dispute resolution. The commercial detail of each project, such as the deliverables, timeline, fees and acceptance criteria, goes into a separate SOW or order form that refers back to the MSA.

The benefit is speed. The parties negotiate the legal terms once, then sign short SOWs as new work comes up. MSAs are common for IT and software services, consulting, marketing agencies, staffing, outsourcing, construction-related services and SaaS (where the "order form" usually plays the role of the SOW).

MSA vs SOW vs service agreement

Document	What it covers	When to use it
Master services agreement	The legal framework: payment terms, IP, confidentiality, warranties, indemnities, liability caps, termination, governing law.	An ongoing relationship with several projects over time.
Statement of work (SOW) or order	One project: scope, deliverables, milestones, acceptance criteria, fees, staffing and dates. Signed under the MSA.	Each new project or phase.
Single service agreement	Legal terms and scope in one document.	A one-off project. See our service agreement template.

Whatever the names, the key drafting point is the order of precedence: say which document wins if the MSA and an SOW conflict, and whether an SOW can override the MSA (usually only if it says so expressly and refers to the MSA section it changes).

Key clauses in a master services agreement

Parties and structure. Exact legal names of the entities. State that the MSA governs every SOW signed under it, and whether affiliates of either party may sign their own SOWs.
SOWs and change orders. What each SOW must contain, that an SOW binds only when signed by both parties, and how changes to scope, timeline or fees are agreed in a written change order.
Order of precedence. Which document controls in a conflict, typically the MSA over the SOW unless the SOW expressly overrides a named MSA section for that project only.
Fees, invoicing and payment. Fee basis (fixed fee, time and materials, retainer), invoicing frequency, payment period, expenses, late-payment interest (within state limits), how good-faith disputes over an invoice are raised, and taxes.
Acceptance. Objective acceptance criteria per deliverable, a review period, and what happens if a deliverable is rejected. Without this, "done" becomes a dispute.
Term and termination. The MSA's own term, termination for convenience and for material breach after a cure period, and what happens to open SOWs when the MSA ends (often they continue under the MSA's terms until finished, unless terminated).
Intellectual property. Who owns deliverables, what each side's pre-existing ("background") IP is, and the license the customer gets to any background IP built into the deliverables. If the provider is an individual contractor, note that a "work made for hire" label only works for certain kinds of commissioned work; add a written assignment as a backstop.
Confidentiality. The definition of confidential information, permitted uses and disclosures, the standard exclusions, how long the duty lasts, and return or destruction at the end. If individuals will receive trade secrets, include the Defend Trade Secrets Act immunity notice (18 U.S.C. §1833(b)).
Data protection and security. If the provider will handle personal data or customer systems, add security obligations, breach notice and, where the law requires one, a data processing agreement. See our DPA review guide.
Warranties and disclaimers. Usually a warranty that services will be performed in a professional and workmanlike manner, with a re-performance remedy, and a disclaimer of other implied warranties to the extent allowed by law.
Indemnification. Who defends and pays for which third-party claims (commonly IP infringement, bodily injury and property damage, and breach of law), and the procedure for claiming. See our indemnification clause review guide.
Limitation of liability. A cap (often linked to fees paid or payable over a period), an exclusion of indirect and consequential damages, and carve-outs from the cap for items such as confidentiality breaches, indemnities, or gross negligence and willful misconduct. Some states limit how far liability for gross negligence, willful misconduct or fraud can be excluded. See our limitation of liability review guide.
Insurance. The types and minimum amounts of insurance the provider must carry, such as commercial general liability, professional liability (errors and omissions) and cyber.
Independent contractor status. The provider controls how its people do the work and is responsible for their pay, taxes and benefits.
Personnel and subcontractors. Whether the provider may subcontract, and whether either side may hire the other's staff. Some states restrict employee non-solicitation and no-hire clauses, so check the governing state's law.
Governing law and disputes. The state whose law applies, the courts or arbitration forum, and any escalation step before a claim is filed.
General terms. Notices, assignment, force majeure, entire agreement, amendments in writing, severability, survival and counterparts and electronic signatures.

Free master services agreement template (sample text)

Copy the text below into Word and fill in the brackets. It is an original, general US sample for a business-to-business services relationship and is deliberately short. It is a starting point, not a finished document. Add the terms your deal needs, such as data protection, service levels or industry rules, and have a lawyer review it before anyone signs.

MASTER SERVICES AGREEMENT

This Master Services Agreement (the "Agreement") is made as of [date] (the "Effective Date") between [PROVIDER LEGAL NAME], a [state] [entity type], with offices at [address] ("Provider"), and [CUSTOMER LEGAL NAME], a [state] [entity type], with offices at [address] ("Customer").

1. Statements of Work. Provider will perform the services and deliver the deliverables described in each statement of work signed by both parties that refers to this Agreement (each, an "SOW"). Each SOW will describe the services, deliverables, acceptance criteria, schedule and fees. Each SOW is governed by this Agreement. A change to an SOW is binding only if set out in a written change order signed by both parties.

2. Order of precedence. If this Agreement conflicts with an SOW, this Agreement controls, unless the SOW expressly identifies the section of this Agreement it overrides, in which case the SOW controls for that SOW only.

3. Fees and payment. Customer will pay the fees and pre-approved expenses stated in each SOW. Provider will invoice [monthly / on the milestones in the SOW]. Undisputed amounts are due within [30] days after receipt of a correct invoice. If Customer disputes an invoice in good faith, it will notify Provider in writing with reasons before the due date and pay the undisputed portion; the parties will work in good faith to resolve the dispute. Fees exclude taxes; Customer will pay applicable sales, use and similar taxes on the services, other than taxes on Provider's income.

4. Acceptance. Customer will have [10] business days after delivery to test each deliverable against the acceptance criteria in the SOW and either accept it or describe in writing how it does not conform. Provider will correct a non-conforming deliverable and redeliver it, and the same process will apply. [Customer's use of a deliverable in production is acceptance.]

5. Term and termination. This Agreement begins on the Effective Date and continues for [___] years, then renews for successive [one]-year terms unless either party gives notice of non-renewal at least [60] days before the end of the then-current term. Either party may terminate this Agreement or any SOW (a) for convenience on [30] days' written notice, or (b) if the other party materially breaches and does not cure within [30] days after written notice. On termination, Customer will pay for services performed and pre-approved expenses incurred up to the termination date. Unless an SOW is terminated, it continues to be governed by this Agreement until completed, even if this Agreement expires.

6. Intellectual property. Each party keeps its intellectual property that existed before the Effective Date or that it develops outside this Agreement ("Background IP"). Upon Customer's payment for a deliverable, Provider hereby assigns to Customer all right, title and interest in that deliverable, excluding Provider's Background IP. Provider grants Customer a non-exclusive, perpetual, royalty-free license to use any Provider Background IP included in a deliverable as needed to use that deliverable. [Delete or adjust if Provider is to keep ownership and license the deliverables instead.]

7. Confidentiality. Each party will use the other party's non-public information disclosed under this Agreement ("Confidential Information") only to perform or receive the services, will protect it with at least reasonable care, and will disclose it only to its personnel and advisers who need to know it and are bound by confidentiality duties at least as protective as these. Confidential Information excludes information that is or becomes public through no fault of the recipient, was known to the recipient without restriction, is independently developed, or is rightfully received from a third party without restriction. A party may disclose Confidential Information if required by law, after giving prompt notice where lawful. These obligations last for [three] years after this Agreement ends, and for trade secrets for as long as they remain trade secrets. [If any individual will receive trade secrets, add the 18 U.S.C. §1833(b) whistleblower immunity notice.]

8. Warranties. Provider warrants that it will perform the services in a professional and workmanlike manner consistent with generally accepted industry standards. If Customer notifies Provider of a breach of this warranty within [30] days after performance, Provider will re-perform the non-conforming services at no extra charge[, and if it cannot do so, refund the fees paid for them]. EXCEPT AS STATED IN THIS AGREEMENT, AND TO THE EXTENT PERMITTED BY LAW, NEITHER PARTY MAKES ANY OTHER WARRANTY, EXPRESS OR IMPLIED, INCLUDING ANY IMPLIED WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE.

9. Indemnification. Provider will defend Customer against any third-party claim alleging that a deliverable, as delivered by Provider, infringes that third party's U.S. intellectual property rights, and will pay the damages and costs finally awarded or agreed in settlement. This obligation does not apply to claims arising from Customer's materials, Customer's modifications, or combinations not supplied by Provider. The indemnified party must give prompt notice of the claim, allow the indemnifying party to control the defense and settlement (but no settlement may impose an obligation or admission on the indemnified party without its consent), and give reasonable cooperation at the indemnifying party's expense. [Add any other indemnities the parties agree, such as for bodily injury, property damage or breach of law.]

10. Limitation of liability. TO THE EXTENT PERMITTED BY LAW, (A) NEITHER PARTY IS LIABLE FOR ANY INDIRECT, INCIDENTAL, SPECIAL, CONSEQUENTIAL OR PUNITIVE DAMAGES, OR LOST PROFITS, ARISING OUT OF THIS AGREEMENT; AND (B) EACH PARTY'S TOTAL LIABILITY ARISING OUT OF THIS AGREEMENT WILL NOT EXCEED THE FEES PAID AND PAYABLE UNDER THIS AGREEMENT IN THE [12] MONTHS BEFORE THE EVENT GIVING RISE TO THE CLAIM. THESE LIMITS DO NOT APPLY TO A PARTY'S INDEMNIFICATION OBLIGATIONS, BREACH OF SECTION 7, GROSS NEGLIGENCE, WILLFUL MISCONDUCT OR FRAUD, OR CUSTOMER'S OBLIGATION TO PAY FEES.

11. Insurance. During the term, Provider will maintain [commercial general liability insurance of at least $[___] per occurrence, professional liability insurance of at least $[___] per claim, and any other coverage stated in an SOW], and will provide certificates of insurance on request.

12. Independent contractors. Provider is an independent contractor. Provider controls the manner and means of performing the services and is solely responsible for its personnel's compensation, benefits and taxes. Nothing in this Agreement creates a partnership, joint venture, agency or employment relationship. Provider may use subcontractors only with Customer's prior written consent and remains responsible for their work.

13. Governing law and disputes. This Agreement is governed by the laws of the State of [state], without regard to its conflict-of-laws rules. The parties will first try to resolve any dispute through good-faith discussions between senior representatives for [30] days. After that, [the state and federal courts located in [county, state] have exclusive jurisdiction / disputes will be resolved by binding arbitration administered by [organization] under its [rules], in [city, state]].

14. General. Notices must be in writing and sent to the addresses above (or as updated by notice). Neither party may assign this Agreement without the other's written consent, except to a successor in a merger or sale of substantially all of its assets or business to which this Agreement relates, on written notice. Neither party is liable for a delay caused by events beyond its reasonable control, other than payment obligations. Sections 3 (for amounts owed), 6, 7, 9, 10, 13 and 14 survive termination. This Agreement, with its SOWs, is the entire agreement on its subject and may be amended only in a writing signed by both parties. If any provision is unenforceable, the rest remains in effect. This Agreement may be signed in counterparts and by electronic signature.

[PROVIDER LEGAL NAME] By: ____________________ Name/Title: [__________] Date: [______]

[CUSTOMER LEGAL NAME] By: ____________________ Name/Title: [__________] Date: [______]

Not legal advice. This sample is not tailored to any state, industry or transaction. It has no data protection, service-level or industry-specific terms. Check the governing state's law on limitation-of-liability carve-outs, indemnities, non-solicitation and late-payment interest before use.

Common mistakes in master services agreements

No order of precedence. An SOW drafted by the business team quietly changes the liability cap or IP terms, and nobody can say which document wins.
Vague SOWs. "Provide marketing support" is not a scope. List deliverables, assumptions, exclusions and acceptance criteria in each SOW.
Assignment of IP before payment, or never. Decide when ownership passes, keep background IP separate, and make sure the customer gets a license to any provider tools built into the deliverables.
A liability cap that swallows the indemnity. If the indemnity is inside a low cap, it may be worth little. Decide expressly which obligations sit outside the cap.
Termination that strands open SOWs. Say whether SOWs survive the MSA's expiry or termination, and what is paid for work in progress.
No change-order process. Scope creep without written change orders leads to fee disputes.
Forgetting data and security terms. If personal data or customer systems are involved, the MSA needs security obligations and, where the law requires it, a DPA.
Restrictive covenants that do not fit the state. Non-solicitation and no-hire clauses are restricted in some states; check the governing law.

How to draft or review an MSA in Word with LexDraft

LexDraft is a Word add-in from Microsoft AppSource. It opens as a side panel in Word 365 (Windows and Mac), Word 2021 and Word on the web, so the MSA stays in the document you are already editing.

Describe the relationship

Open LexDraft in Word and describe the deal in plain English: the parties, the kind of services, how fees work, who should own the deliverables, and the governing state. LexDraft asks a few clarifying questions, then writes a first draft into your document as editable Word text.

Review it with a playbook

To review an MSA you drafted, or one the other side sent, pick the governing state and run a review. LexDraft has four built-in playbooks: NDA, SaaS MSA, DPA and services agreement. Use the SaaS MSA playbook for a software subscription MSA and the services agreement playbook for a professional-services MSA. Findings are graded Critical, High, Medium or Low, and LexDraft flags standard terms that are missing.

Check and accept the redlines

Run the defined-term and cross-reference checks, which are rule-based and run without AI. The cross-reference check flags supported references, such as "Section 12", whose target heading is missing from the open document. Check references between a separately stored MSA and its SOWs yourself. Accept or reject each proposed redline; accepted changes land as native Word tracked changes.

What LexDraft does not do: it does not give legal advice or tell you what your client should accept. You decide what matters for the deal and check every output before anyone signs. For a clause-by-clause review checklist, see how to review an MSA in Word, and for negotiation tactics see how to negotiate a master services agreement.

Frequently Asked Questions About Master Services Agreements

What is a master services agreement (MSA)?

A master services agreement is a framework contract that sets the legal terms for an ongoing services relationship: payment terms, intellectual property, confidentiality, warranties, indemnities, limitation of liability, termination and dispute resolution. Each project is then documented in a short statement of work (SOW) or order that refers back to the MSA, so the legal terms do not have to be renegotiated every time.

What is the difference between an MSA and an SOW?

The MSA holds the legal terms that apply to every project. An SOW describes one project: the services, deliverables, milestones, acceptance criteria, fees and dates. The SOW is signed under the MSA and is governed by it. An order of precedence clause says which document controls if they conflict.

Is an MSA legally binding?

Generally, yes. A signed MSA is a contract, and its terms bind the parties. Many MSAs do not commit the customer to buy any services until an SOW is signed, so the obligation to perform and pay for specific work usually comes from each SOW, read together with the MSA.

Which document controls if the MSA and an SOW conflict?

Whatever the order of precedence clause says. Most MSAs say the MSA controls unless the SOW expressly identifies the MSA section it overrides for that project. Without such a clause, a court applies ordinary contract interpretation rules, which can make the outcome hard to predict.

What should a master services agreement include?

The usual clauses are: how SOWs and change orders work, order of precedence, fees and payment, acceptance, term and termination, intellectual property ownership and licenses, confidentiality, data protection and security where relevant, warranties, indemnification, limitation of liability, insurance, independent contractor status, governing law and dispute resolution, and general terms such as notices and assignment.

How long does an MSA last?

As long as the parties agree. Many MSAs run for one to three years and renew automatically unless either party gives notice. A good MSA also says what happens to SOWs that are still open when the MSA ends; often they continue under the MSA terms until they are completed or terminated.

Who usually drafts the MSA?

Either side. Large customers often insist on their own vendor MSA, while providers usually prefer their own form. The party that drafts usually starts from terms that favor it, so the other side should review the liability cap, indemnities, IP ownership and termination terms with particular care.

Can I use a free MSA template?

Yes, as a starting point. A template shows the usual structure and clauses, but it is not tailored to your industry, state or deal. Fill in every bracket, add the terms your relationship needs, such as data protection or service levels, and have a lawyer licensed in the relevant state review it before signing.

Reviewing an MSA someone else drafted?

Draft and review MSAs in Word

Describe the relationship, get a first draft in your document, then review it with tracked-change redlines. You stay in Word, and you decide what changes.

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This page is general information, not legal advice. LexDraft does not give legal advice; review every draft with qualified counsel licensed in the relevant state. Spotted something out of date? Email support@lexdraft.ai and we will fix it.