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Website Development Agreements


Criteria to Consider When Selecting a Website Developer

□ Developer’s experience and qualifications

□ Identify parties and their relationship

□ Extent of allowable subcontracting

□ Whether to include both designing and hosting

□ Implications of co-branding or joint development

Basic Objectives

□ Specifications for website

  • - Statements of work
  • - Technology and equipment to be supplied

□ Change management process

□ List competing websites and extent to which your website is based on them

□ Required functions

□ Maintenance and updating requirements

□ Define developer rights of access

Intellectual Property Ownership

□ Obtain proper licenses and assignments

Software Requirements

□ Ensure “open use” software

□ Determine rights to software and whether to sublicense or separately license

□ Acquire disclosures from developer

□ Identify who owns the software

□ Address disabling devices

Schedules and Timetables

□ Start date

□ Anticipated termination date

□ Intermediate “checkpoints”

□ Process for modifying schedule

□ Consequences if “checkpoint” not met:

  • - Extension
  • - Monetary penalties
  • - Termination
  • - Delay
  • - Acceleration

Term and Termination

□ Initial term

□ Maintenance, hosting, and colocation services

  • - Requirements for developer:
  • - Return company property
  • - Transfer software to company
  • - Turn over documents
  • - Confidentiality assurances
  • - Receipts for reimbursements

□ Final statement from developer and company that work was completed

□ Termination without consent for material breach of contract

Other Provisions

□ Fees, charges, and expenses

□ Project management

□ Acceptance testing

□ Warranties

□ Identifications

□ Content of website

□ Linking issues

□ Insurance

□ Reports, records, and audits

□ Training, education, and troubleshooting

□ Disputes

□ Trademarks and copyright

□ Privacy

□ Terms of use


Website development agreements describe the programming, services, and other requirements associated with a company’s website development project. Websites come in many different varieties, ranging from the plain to the glitzy and from the simple to the complex. After a company has made some basic decisions concerning the type of site it wants—or the type of site it wants its current site to become—a website developer should be selected who has the experience and capability in that type of site. To some extent, the criteria and desires of the company in this process should be reflected in the website development agreement.

Initial Issues to Think About

■ Companies should evaluate a potential website developer’s experience and qualifications. It is frequently appropriate to include in the website development agreement a recitation of the developer’s experience, sometimes as a substitute for a warranty from the website developer concerning the developer’s ability and qualifications to do the job.

■ It is important for both sides to know who the parties to the agreement are and what their relationship is. On the developer side, it is important to know whether the “contractor” is an entity that will actually do the work through individuals and whether those individuals are going to be independent contractors or employees. On the company side, the issue is sometimes related to “affiliates” (who would need to be defined) and subsidiaries. In addition, consider whether the parties are entering into an exclusive relationship, or if either party can work with a competitor of the other party during and after the term of the agreement.

■ The website development agreement should address the extent to which subcontracting of the work will be allowed or prohibited. If subcontracting is permitted, the company should have approval rights over which subcontractors are used, or the parties should agree ahead of time to a list of approved subcontractors. In each case, the company should ensure it conducts proper diligence with respect to, at a minimum, experience and qualifications, of any subcontractor who will be performing services associated with the development of the website for the developer.

■ Consider whether the developer is merely designing the website or if it will also host the site. If the developer is hosting the website, the agreement should include essential hosting requirements.

■ If the website is co-branded or jointly developed, the agreement will commonly describe who will own any end-user information collected from operation of the website. In addition, it is important to describe how this information will be used and what happens to this information upon termination of the agreement.

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