You need to enable JavaScript in order to use the AI chatbot tool powered by ChatBot

SaaS Agreement Checklist: 10 Things You Need to Know

Share via:
blog-cms-banner-bg
Little-Known Negotiation Hacks to Get the Best Deal on Slack
cta-bg-blogDownload Your Copy

HIPAA Compliance Checklist for 2025

Download PDF

Procurement Teams: Say Goodbye to Surprise Clauses.

Use this checklist to align with legal, IT, and finance before the deal is sealed.

Grab Free Checklist
CTA Thumbnail

Think your SaaS contract is locked in just because the legal team signed off? You might want to double-check that.

According to Gartner, SaaS spending is growing at nearly 19% year over year but many teams still don’t know which terms can be negotiated, or how to avoid hidden renewal risks and usage-based charges that quietly inflate spend.

This SaaS agreement checklist breaks down 10 contract terms worth reviewing before signing or renewing your next SaaS deal. From user access limits to data ownership, we’re covering what matters and why it can cost you if ignored.

TL;DR 

  • SaaS contracts aren’t just legal paperwork; they define usage rights, renewal timelines, penalties, data ownership, and service expectations. Missed terms can quietly inflate your spend.
  • Most buyers skip reading the fine print. Yet, 91% of Americans don’t read agreements, and that’s a risk when handing over sensitive data or relying on uptime guarantees.
  • This checklist covers 10 key areas, including access limits, SLAs, renewal clauses, termination policies, and billing metrics, so you can review and renegotiate smarter.
  • Tools like CloudEagle can automate it all from extracting contract metadata to managing renewals, usage tracking, and vendor negotiations, giving your team full visibility and control.

What is a SaaS agreement?

A SaaS agreement is a legal contract between the software provider and the customer, specifically outlining the framework for accessing and using cloud-based software. Understanding the essentials of a SaaS agreement is key when evaluating software delivered through a subscription model.

  • Defines terms for accessing and using the software over the internet
  • Details subscription duration, pricing, and service level expectations
  • Outlines data security measures and intellectual property rights

The SaaS contracting process is often managed by legal professionals to ensure both clarity and regulatory compliance.

  • Drafts terms and conditions based on SaaS delivery and usage
  • Includes a privacy policy and usage requirements
  • Specifies user restrictions and a termination policy
  • Covers geographical usage policies

A SaaS license agreement further clarifies important topics such as intellectual property rights, confidentiality, limitation of liability, and conditions with direct or indirect impacts on your business.

  • Requires acknowledgment and acceptance of all terms
  • Necessitates signing the contract and providing consent before use

However, it's essential to note that most buyers tend to skip reading the SaaS license agreement, which can lead to oversight of critical details.

Buyers don’t read SaaS license agreements

According to research from Deloitte, a staggering 91% of Americans never read the agreements they sign, this includes critical documents like SaaS agreements.

Remember, this SaaS solution could become a long-term part of your tech stack. It may interact with customer data, proprietary intellectual property, and essential revenue-generating processes.

If you miss critical details in the agreement’s fine print, you could be opening the door to avoidable risks, costly compliance issues, and challenging clean-up efforts in the future.

Why do you need a SaaS Subscription Agreement as a buyer?

‍A SaaS agreement serves as a common ground for software providers and customers. It works as a legal shield from the software providers’ perspective that details all obligations for the end users. Proper saas contracting ensures both parties understand these responsibilities clearly.

The SaaS vendor can even hold the customers accountable in cases of service misuse or violation of agreement terms, as per the applicable law.

Users need to understand the obligations and terms of usage in a SaaS agreement. The agreement for customers generally lists service-level guarantees, licensing requirements, terms of use and permit, how your data is stored or used, and certain restrictions.

Some of the crucial aspects you need to check in a SaaS agreement are:

  • How does the vendor define the data collected and stored on their servers?
  • How does the provider collect the data?
  • The type of data collected and the duration for which the data is stored
  • Will the company erase the data once you stop using the services?
  • Who has ownership of the data?
  • Is there an indemnification clause included in the SaaS contract?
  • What is the penalty for breaching the contract?
  • Who will be held accountable in the event of a data breach?

You need to find the answer to these questions in your SaaS contract agreement. A SaaS agreement helps buyers know about data management, liability, and SaaS usage terms.

Reading the cloud service agreement conditions before accepting them can be daunting; include a legal team during the contract, and follow this SaaS contract agreement checklist to make the process easier.

What are the components of a SaaS contract?

Before signing a SaaS agreement, buyers should systematically review these essential components to ensure proper protections and clear service expectations. Each element represents a critical area where vague terms can lead to disputes or unexpected costs.

  • Parties & Scope of Services: Verify all covered services, features, and any geographic or use restrictions that may limit deployment
  • License and Access Rights: Confirm user count limits, named vs. concurrent licensing, and whether usage restrictions align with your intended use
  • Data Ownership & Processing: Ensure you retain ownership of your data and understand vendor's rights to use it for analytics or AI training
  • Security & Compliance: Validate certifications (SOC 2, ISO 27001, GDPR) match your compliance requirements and check breach notification timelines
  • SLAs & Support: Review uptime commitments, support availability, response SLAs, and financial remedies for service failures
  • Pricing & Fees: Check for hidden costs, annual price increases, overage charges, and whether professional services are included or extra
  • Consumption/Billing Metrics: Understand how usage is measured (per user, API calls, storage) and what triggers additional charges
  • Term & Renewal: Note contract length, auto-renewal clauses, and required notice period (typically 30-90 days before renewal)
  • Termination & Exit: Verify termination rights, early exit penalties, data export procedures, and timeline for data deletion
  • IP & Confidentiality: Clarify who owns customizations, integrations, and ensure mutual confidentiality protections
  • Liability & Indemnity: Understand liability caps and negotiate for adequate coverage relative to contract value and risk exposure
  • Audit & Verification: Confirm your rights to audit usage, verify security controls, and review vendor's compliance documentation
  • Governing Law & Disputes: Check jurisdiction for legal disputes and whether arbitration or litigation is required

What is a SaaS Agreement Checklist

‍A SaaS agreement checklist plays a crucial role in ensuring transparency and effective management of your SaaS subscriptions. 

It covers essential elements like contract duration, subscription terms, user access rights, data ownership and protection, SLAs, pricing structures, payment terms, and termination conditions. Having a detailed checklist streamlines negotiations, strengthens contract oversight, and reduces potential risks.

Key elements typically included in a SaaS agreement checklist:

  • Contract duration – Start and end dates of the subscription.
  • Subscription terms – Monthly vs. annual billing, renewal conditions.
  • Access rights – Who can access the service, and how permissions are managed.
  • Data ownership – Clear terms on who owns the data and what happens upon termination.
  • Data security – Compliance with industry standards like SOC 2, GDPR, HIPAA, etc.
  • Service Level Agreements (SLAs) – Uptime guarantees, support response times, and performance metrics.
  • Pricing and payment – Detailed fee structure, additional costs, and payment timelines.
  • Termination clauses – Exit terms, notice periods, and any penalties involved.

Which key clauses should every SaaS agreement include?

A thorough SaaS agreement checklist is essential for ensuring your data is protected, costs are predictable, and you maintain control over your software relationship. Carefully evaluating the following areas before signing will help you avoid common pitfalls and secure favorable terms:

  • Data Protection & Processing: Review data processing clauses, including details on subprocessor involvement and specific data storage locations. Ensure the agreement outlines how your data will be handled and protected.
  • Security Commitments: Expect explicit commitments around encryption standards, breach notification timelines (ideally 24-48 hours), and adherence to security certifications such as SOC 2 or GDPR. Confirm how security incidents will be communicated and managed.
  • Service Levels & Uptime: Look for clear uptime guarantees, typically 99.9% or higher, backed by meaningful remedies like service credits rather than general apologies. The SLA should clearly define how downtime is measured and compensated.
  • Support & Response Times: Support terms should specify response times based on issue severity, with escalation paths in place to address urgent concerns quickly.
  • Pricing & Financial Terms: Negotiate caps on price increases, clarify procedures for true-ups on license overages, and ensure you fully understand usage metrics that may lead to additional charges.
  • Renewal & Termination: Pay close attention to renewal clauses, insist on at least 90-day notice periods and secure the right to terminate for convenience, not just for cause. Make sure you can easily exit the agreement if your needs change.
  • Data Portability & Deletion: Confirm you can export your data in accessible formats upon termination, and establish clear timelines for when your data will be deleted after exit.
  • Red Flags to Watch For: Be wary of vague liability limitations benefitting only the vendor, one-sided indemnification clauses (you should be covered in case of vendor IP issues or data breaches), and unilateral terms changes. Protect your interests by negotiating balanced terms.
  • Audit Rights & IP Ownership: Secure audit rights to verify compliance and usage. Make sure the agreement explicitly states that you retain ownership of your data.
  • Contract Tracking: Before signing, extract key contract metadata, including renewal dates, notice periods, and pricing terms, into a contract management or tracking system to prevent unwanted auto-renewals or missed deadlines.

By following this SaaS agreement checklist, you can minimize risks, maintain control over your data, and create a stable, cost-effective partnership with your SaaS provider.

The 10-Point SaaS Agreement Checklist You Can’t Ignore

Image showing sub-headings of SaaS agreement checklist

1. Start and End Dates

The start date is when the SaaS agreement officially becomes active. From the agreement start date, the SaaS application becomes available for use by individuals or companies that purchased it.

The SaaS agreement’s end date refers to the renewal or termination of the subscription. To ensure a smooth user experience and prevent application downtime, it's crucial to stay vigilant about tracking start and end dates.

Tracking the end date of the SaaS subscription agreement is essential for the sales teams to negotiate the contract upgrade or renewal terms.

Sales reps can help companies get the best value from a SaaS subscription. Planning the renewal negotiation strategy ahead of the curve is always profitable for companies, and this is possible only if the contract dates are tracked effectively.

Also check:

  • If the contract is set to auto-renew
  • Whether there are penalties or fees for missing the renewal window

This small detail can lead to big savings and avoid paying for unused software in 2025.

2. Access Rights and Users

The next vital aspect of a SaaS agreement checklist is access rights and users. Most agreements cap the number of users accessing the software, and this limit varies depending on the pricing plan.

Most basic SaaS agreements come with a single-user license, which means multiple users can’t access the platform under the same contract. While buying the subscription, you should know this parameter, it can help you avoid unnecessary costs.

If you have more team members:

  • Consider upgrading to an enterprise plan
  • Ask the provider to customize the agreement based on your usage
  • You might be eligible for a volume discount

You also need to check:

  • Penalties for exceeding the user limit
  • Data entitlements tied to the plan
  • Whether violating usage policies could result in service suspension or contract termination

Some vendors enforce their terms strictly, so it’s important to understand what your plan includes and what it doesn’t.

3. Customer Support and Services

In the SaaS agreement checklist, customer support plays a critical role in delivering a smooth user experience, especially during onboarding or unplanned downtime.

Before you choose a SaaS application, read the customer support and service clauses carefully. Some vendors offer phone support, others provide 24×7 email support, and a few include both.

Here’s what you should check:

  • How support is delivered (email, phone, live chat)
  • Whether support is available during your working hours
  • Average response time, especially if you're in a different time zone

Also, look for onboarding and technical assistance. If it's not included by default, request the vendor to add it either as part of the agreement or within the pricing structure.

Support quality isn’t just a nice-to-have. It directly affects your team’s ability to use the product effectively.

4. Data ownership and usage

Data ownership comes with legal weight and should never be overlooked when subscribing to a new SaaS tool. This point of the SaaS agreement checklist should clearly state whether a SaaS agreement includes:

  • How the vendor collects and stores data
  • What data ownership looks like during and after the contract period

The agreement should confirm whether the uploaded or generated data belongs to you (the customer), or if the vendor retains ownership. Some vendors may claim ownership but allow retrieval after termination – read this part carefully.

This section is often a gray area, where vendors include surface-level language but bury important clauses deeper in the document. Don’t skip the details.

Data Usage

If the vendor retains any rights to your data, check how they plan to use it. In some cases, they might:

  • Use customer data to improve their services
  • Feed usage data into AI models or analytics

You can restrict this if it involves sensitive information like:

  • Patents
  • Source code
  • Trade secrets
  • Customer or financial data

In the EU, regulations like GDPR offer some protection. But in other regions, vendors may collect and use broader datasets unless you explicitly limit them.

To stay compliant in 2025, make sure the data usage clause is clearly defined and aligned with your internal policies before you sign.

5. SaaS subscription/renewal notice period

SaaS renewal is one of the most overlooked details in a SaaS agreement checklist and often the most frustrating.

Vendors should clearly define the notice period and specify a deadline for users who don’t want to renew automatically. If a user chooses not to renew, they must notify the vendor before the notice period stated in the agreement.

For example, if the SaaS agreement requires 30 days’ notice, subscribers must inform the vendor within that timeframe whether they plan to renew or not.

The real challenge? Most enterprises use over 100 SaaS apps – all with different renewal terms. Managing these manually is time-consuming, error-prone and often leads to unexpected auto-renewals.

A 30-day notice is the most common, but some contracts specify 15, 60, 90, or even 180 days. Without a formal process, it’s easy to miss deadlines and pay for services you no longer need.

A key SaaS renewal best practice is to ensure the notice period is clearly stated in the contract. Negotiate for a 90-day window if possible to give your team time to evaluate the tool before it renews. Use a centralized contract management system to track all agreements and automate renewal workflows.

Here’s Pratibha Mehta from Falkonry, recalling her experience with CloudEagle.ai and how it helped her team streamline SaaS renewals:

6. Total SaaS Contract Value

It’s important to know the total contract value and the amount you’ll pay for the full renewal cycle, not just the monthly or annual fee.

The total contract value includes all financial obligations tied to a SaaS agreement across business units. Having a clear view of this gives you an edge when evaluating vendor performance or negotiating renewals.

There are often gaps between what was initially agreed to and what actually ends up being billed.

For example, if your contract states $20,000 but the invoice shows more, it’s worth investigating. The increase could be due to:

  • Additional active users beyond the license
  • Overage charges
  • Opt-ins for new features
  • Trial tools that were never canceled but renewed automatically

That’s why it’s smart to review SaaS contracts regularly and track:

  • App usage
  • Extra feature add-ons
  • Any hidden or compounding costs

Instead of managing this manually, use a SaaS spend management platform like CloudEagle.ai to monitor usage, flag redundancies, and surface insights.

With usage data in hand, you can optimize spend, avoid surprise charges, and enter renewal talks with better leverage.

7. Service Level Agreement

SLA is a significant aspect of SaaS agreements you should check while subscribing to a new service.

Typically, all SaaS agreements come with a comprehensive SLA section covering the services vendors ought to provide, including the different performance standards and usability criteria.

The best thing about SLAs is that the vendors must meet the requirements.

For example, most SaaS agreements offer a 99% uptime percentage, and if the vendor fails to meet it, you can hold them accountable if stated in the SLA.

Suppose you face frequent service interruptions or sluggish performance. In that case, you can report your issues to the company and ask them to make reasonable efforts to resolve them as soon as possible.

Response time is a crucial service level agreement clause that defines the turnaround time for any problem resolution from the vendor side. This clause plays a significant role if you have a substantial dependency on that SaaS.

Subscribe to SaaS agreements only if you are comfortable with their service terms and performance standards.

8. Consumption Metrics and Billing Units

In SaaS agreements, "consumption metrics" are a set of parameters used to measure the usage of the SaaS application. You need to pay close attention to this clause as it’ll help you understand how the vendor will bill you during contract renewals.

The vendor might charge based on:

  • Per-user
  • Per-feature
  • Actual usage volume

Understanding this structure is critical. Without visibility into consumption patterns, teams often end up paying for licenses or features they don’t fully use.

For finance teams and business owners, managing these billing units effectively helps control SaaS expenses. Instead of relying on manual checks, consider using a SaaS management platform like CloudEagle to:

  • Track consumption metrics
  • Flag underused apps or plans
  • Make informed decisions during negotiations

Before signing a SaaS subscription agreement, carefully review how billing is calculated. The consumption metrics and associated charges should be clearly defined and easy to interpret. This ensures you’re only paying for what you actually use and not getting hit with surprises during renewals.

9. Data Handling and Regulatory Compliance

Data handling is another critical aspect that shouldn’t be overlooked in a SaaS agreement checklist.

Data protection plays a central role in SaaS operations, and vendors are expected to comply with relevant regulatory standards when processing personal or corporate data.

You need to know:

  • How your vendor stores, manages, and uses your data
  • Whether they follow the appropriate compliance frameworks

No buyer wants to be locked into a contract with a vendor who can’t guarantee data security. With regulations like GDPR, CCPA, PCI DSS, and SOC II, many organizations are legally required to work only with compliant providers.

Make sure the vendor’s product aligns with the latest security and compliance standards before signing anything. If you're operating in a region or industry with stricter requirements, confirm that the vendor also complies with exclusive jurisdiction rules relevant to your business.

The SaaS agreement should clearly outline:

  • What standards apply
  • What compliance certifications the vendor holds
  • How data will be handled under those regulations

Don’t assume compliance is a given; get it in writing.

10. Termination policy

We’ve reached the final point in the SaaS agreement checklist. A SaaS contract is incomplete if it doesn’t clearly define the termination clause or policy.

Every vendor will have their own set of rights and conditions that customers must follow. These policies often vary depending on the type of subscription your team is using.

A termination clause should clearly specify:

  • Penalties for early contract termination
  • Notice period required for cancellation
  • Auto-renewal conditions, in case no termination notice is provided
  • Data retention and migration steps
  • Any post-termination commitments

Most vendors will state that you don’t own the data during the contract period. So when it’s time to terminate, your team needs to clarify:

  • How the data will be returned or migrated
  • How long the vendor will retain your data
  • What security protocols will be followed after termination

Image showing the Adobe's penalty

Some vendors may also include hidden charges, especially if licensing rights were breached or services are auto-renewed without clear notice. Ask upfront about these penalties and get written confirmation before signing.

A SaaS contract is only complete if these elements are transparent. If you spot vague, redundant, or unclear clauses, don’t ignore them. Clarify or renegotiate.

How do you develop a SaaS agreement?

Developing a comprehensive SaaS agreement checklist requires a structured approach that balances better compliance with operational efficiency. Start by defining your use cases and identifying all stakeholders across IT, procurement, legal, and business units who will interact with the agreement.

  1. Map data flows and compliance requirements – Document how data will be collected, stored, and processed, ensuring alignment with GDPR, SOC 2, or other relevant standards.
  2. Select licensing models and billing metrics – Choose between per-user, usage-based, or tiered pricing structures that match your organization's needs.
  3. Draft scope, SLAs, and support terms – Define service levels, uptime guarantees, response times, and support channels clearly.
  4. Set renewal and notice periods – Establish clear timelines (typically 30-90 days) to avoid auto-renewals and allow proper evaluation.
  5. Plan termination and data exit procedures – Specify how data will be returned, deleted, and migrated upon contract end.
  6. Align security and privacy appendices – Include data processing agreements and subprocessor disclosures.
  7. Finalize pricing protections – Lock in rate caps, volume discounts, and usage overage terms.
  8. Run legal and procurement reviews – Ensure all stakeholders approve terms before signature.
  9. Implement contract metadata tracking – Use centralized systems to monitor renewal dates, pricing, and key terms automatically.

Pre-signature checklist: Verify all pricing terms are documented, compliance certifications are current, termination clauses are clear, and renewal dates are tracked in your management system.

How to write a SaaS license agreement

Drafting a thorough SaaS license agreement is essential for protecting both the provider and the customer, as well as ensuring regulatory and operational requirements are met. By following a clear SaaS agreement checklist, you can address all critical aspects of the contract to reduce legal risks and build trust between parties.

  • Service Levels: Define performance standards, uptime guarantees, and support response times to clarify expectations and obligations.
  • Data Protection: Set out responsibilities for safeguarding customer data, including security measures, data privacy compliance, and breach notification protocols.
  • Termination Clauses: Outline the conditions under which either party can terminate the agreement, along with notice requirements and any associated penalties.
  • Licensing Terms: Specify how the software can be used, including any restrictions on users, locations, or activities.
  • Payment Schedules: Clearly state the payment terms, billing intervals, renewal conditions, and procedures for late or missed payments.
  • Liability Limitations: Set limits on each party’s liability for damages, losses, or service interruptions to protect against unforeseen events.
  • Compliance Requirements: Ensure the agreement addresses relevant legal, industry, and regulatory obligations for your business and customers.

Using this SaaS agreement checklist helps create a comprehensive, enforceable contract that supports a positive business relationship and ongoing compliance.

SaaS Agreement Vs. Software License: Know the Difference

Feature SaaS Agreement Software License
Access Model Subscription-based; vendor hosts software One-time or periodic license fee; software installed on buyer's systems
Ownership Vendor retains ownership Buyer owns the license (not the software itself)
Maintenance & Upgrades Vendor handles maintenance, updates, and security Buyer is responsible for maintenance and security
Geographic Limitations Usually not restricted by region Can be exclusive or non-exclusive to specific regions
Installation Used via the cloud; no installation or configuration needed Requires installation and configuration before use
Usage Duration As long as the subscription or SaaS contract is active Typically perpetual, unless otherwise specified

CIOs: Your Teams Are Only Using 62% of What You’re Paying For

Learn how to automate license right-sizing and reinvest what you save.

Get the Free License Management eBook
CTA Thumbnail

What types of SaaS licensing agreements exist?

SaaS licensing agreements offer various models, each impacting your SaaS agreement checklist and budget planning. Choosing the right model aligns costs with your actual usage and organizational needs.

  • Per-User Licensing: Charges are based on individual users, either as named licenses (assigned to specific people) or concurrent licenses (shared within a user pool). Easy to budget, but requires tracking user counts and managing true-ups for additional users.
  • Usage-Based Pricing: Costs depend on measurable consumption such as API calls, data storage, or transactions. Offers flexibility, but can result in variable monthly costs—requires strong oversight on usage and clear overage policies.
  • Tiered Pricing: Features are bundled into packages (like basic, professional, or enterprise). Good for scaling, but may include features you don’t use.
  • Enterprise/Elastic Licensing: Provides volume discounts and allows flexible allocation across teams or locations. Ideal for large organizations but can complicate renewals if usage patterns shift.
  • Freemium-to-Paid Upgrades: Starts with a free plan and upgrades as needs grow. Reduces initial cost but can lead to unmanaged sprawl if upgrades aren’t monitored.

When selecting a licensing model, consider:

  • User growth forecasts and how easily you can track users or usage
  • Usage predictability versus budget flexibility
  • Internal governance for monitoring consumption and renewals
  • Negotiating terms for true-ups, notice periods, and downgrade rights to maintain control during renewals

Top SaaS Agreement Examples Every Buyer Should See

When evaluating SaaS agreements, buyers need practical templates and real-world examples to guide their negotiations. Here are three proven resources that provide actionable insights for your next software purchase:

Salesforce Master Services Agreement (MSA)

As the world's leading CRM platform, Salesforce's MSA sets industry standards for enterprise SaaS contracts. Their Service-Level Agreement defines "service levels, performance metrics, responsibilities, and non-compliance consequences. This comprehensive approach helps buyers understand how to structure accountability measures and performance guarantees in their own saas contracting priocesses.

Microsoft Azure Online Subscription Agreement

Microsoft's Azure agreement demonstrates how cloud infrastructure providers handle complex service delivery commitments. The agreement covers "online services use, purchasing services, warranties, and more. This template is particularly valuable for understanding how to negotiate terms for mission-critical cloud services and data handling provisions.

Slack Main Services Agreement

Slack's agreement offers a clear example of how communication platforms balance user rights with service obligations. Their terms detail and clarify your rights and responsibilities when using Slack. This straightforward approach helps buyers understand how to negotiate clarity around data ownership, security requirements, and usage limitations.

What are the legal requirements and best practices for SaaS agreements?

Ensuring strong legal compliance and clear operational terms are key for any SaaS agreement. Use this checklist to guide your contract process:

  • Verify vendor compliance with regulations like GDPR, CCPA, SOC 2, and PCI DSS when handling data.
  • Include Data Processing Agreements (DPAs) covering subprocessor disclosures, data residency, and cross-border transfers.
  • Set security controls, including breach notification timelines (usually 24–72 hours) and accessibility standards.
  • Define uptime guarantees backed by robust Service Level Agreements (SLAs).
  • Ensure fair limitation of liability and indemnification clauses for both parties.
  • Clearly outline ownership of intellectual property, especially for customer data and derivative works.
  • Add audit rights so customers can confirm vendor security practices without disrupting business.
  • Specify change management procedures for contract changes, price updates, and feature removals, including advance notice periods.
  • Maintain all agreements in a centralized contract repository with automated renewal notifications at least 90 days out.
  • Conduct regular compliance audits, set clear breach notification steps, and define exit processes—covering data return, deletion, and transition support.
  • Schedule ongoing access reviews to ensure contract terms match actual usage, reducing risk and wasted spend.

Use a SaaS Management Platform to Handle Agreements at Scale

Image showing SaaS apps functionalities

Reviewing SaaS contracts manually is time-consuming, and it only gets harder as your portfolio grows. But ignoring renewal clauses, termination terms, or usage caps isn’t an option. These details impact spend, compliance, and business continuity.

That’s why growing teams use a SaaS management platform like CloudEagle to centralize contracts, streamline renewals, and automate every part of the subscription lifecycle.

See how Aira centralized their SaaS contracts using CloudEagle.

Here’s how it helps:

Contract Management made simple

Centralize all your SaaS contracts in one place no more scattered PDFs, inbox digging, or version confusion.

  • CloudEagle.ai uses AI-powered metadata extraction to pull key terms like renewal dates, notice periods, pricing, usage limits, and termination clauses from your contracts automatically.
  • Contracts become searchable, sortable, and actionable in seconds.
  • During renewals or audits, your team has everything it needs without legal bottlenecks.

get contract information

Aira now retrieves contracts instantly during renewals, saving time and avoiding compliance gaps.

Renewal Management You Can Rely On

CloudEagle automatically builds a renewal calendar using extracted metadata.
You can:

  • Set up workflows that trigger 90 days before renewal
  • Route approvals to stakeholders
  • Avoid last-minute negotiations or unwanted auto-renewals

get customised renewal alerts

All of this takes the stress out of saas contracting renewals.  Check out how Wefunder automated their renewals using CloudEagle.ai.

Stronger Negotiations, Backed by Data

Contract renewals aren’t just admin, they’re an opportunity to cut costs and improve terms.

With CloudEagle.ai, you get:

  • Real-time usage insights tied to each contract
  • Benchmarking data to counter vendor pricing
  • Visibility into underutilized licenses you can cut

get negotiation data of specific apps

When your finance, IT, and procurement teams come to the table, they come prepared.

Need Help Negotiating? We’ll Handle It for You

Short on time or expertise? CloudEagle.ai offers assisted buying.

Our negotiation experts handle vendor communication, review agreements, and secure better pricing based on your usage patterns so your team can stay focused on strategic work. 

get expert negotiation insights

From procurement and contract visibility to renewals, negotiation, and compliance, CloudEagle is the all-in-one solution to streamline SaaS management.

🎧 Listen to Terry Larock, Head of Procurement at Tipalti, as he shares how he mastered SaaS procurement and secured the best deals for his company.

Key SaaS Agreement Terms to Negotiate Successfully

When reviewing your SaaS agreement checklist, it's essential to focus on negotiating the terms that will have the greatest impact on your organization's security, operational continuity, and return on investment. A well-negotiated SaaS contract not only protects your interests but also ensures you receive the level of service and flexibility your business needs as it grows. Here are the key areas to prioritize during negotiations:

  • Data Security: Make sure the agreement outlines robust data protection measures, compliance requirements, and clear responsibilities for managing and reporting data breaches.
  • Service Level Agreements (SLAs): Negotiate detailed SLAs that define uptime guarantees, response times, and remedies for service disruptions, helping to minimize business risks.
  • Termination Clauses: Clarify the conditions under which you or the vendor can terminate the contract, including notice periods, exit procedures, and data retrieval rights to support a smooth transition if necessary.
  • Pricing Structures: Seek transparency in subscription fees, renewal terms, and pricing adjustments to avoid unexpected costs and maintain budget control over the term of the agreement.
  • Liability Limitations: Evaluate caps on vendor liability, indemnification terms, and exclusions to ensure your organization is adequately protected in case of losses or service failures.
  • Intellectual Property Rights: Define ownership and usage rights for any data or customizations, and confirm your ability to retain access to critical information if the agreement ends.

By systematically addressing these critical terms, you can maximize the value of your SaaS investment and safeguard your organization against potential risks.

Final Word

A well-structured SaaS agreement isn’t optional; it’s protection. That’s why we created this checklist: to help you catch the fine print before it costs you.

CloudEagle.ai simplifies how you manage your SaaS contracts, vendors, and renewals, all in one place. With features like automated vendor discovery, usage-based negotiation support, and renewal workflows, it helps you control spending and stay compliant.

Whether you're a fast-scaling startup or an enterprise managing hundreds of apps, CloudEagle.ai gives you the visibility and control to make smarter decisions.

Top IT Teams Follow These SaaS Management Practices to Save $2M+ Annually.

Grab the detailed guide that helps IT leaders optimize their entire SaaS portfolio efficiently.

Get The Management Guide
CTA Thumbnail

‍Frequently Asked Questions 

1. What should be included in a SaaS agreement?

It should include contract duration, pricing, SLAs, data ownership, security terms, access rights, renewal terms, and termination clauses.

2. How to review SaaS agreements?

Review terms for pricing, SLAs, data rights, renewal policies, and exit clauses. Use a checklist to ensure clarity and risk coverage.

3. What is the difference between SLA and SaaS agreement?

A SaaS agreement covers the full contract, while an SLA focuses specifically on service performance, uptime, and support expectations.

4. What are the essentials of a service agreement?

Key essentials include the scope of services, performance metrics, payment terms, responsibilities, dispute resolution, and termination rights.

Advertisement for a SaaS Subscription Tracking Template with a call-to-action button to download and a partial graphic of a tablet showing charts.Banner promoting a SaaS Agreement Checklist to streamline SaaS management and avoid budget waste with a call-to-action button labeled Download checklist.Blue banner with text 'The Ultimate Employee Offboarding Checklist!' and a black button labeled 'Download checklist' alongside partial views of checklist documents from cloudeagle.ai.Digital ad for download checklist titled 'The Ultimate Checklist for IT Leaders to Optimize SaaS Operations' by cloudeagle.ai, showing checklist pages.Slack Buyer's Guide offer with text 'Unlock insider insights to get the best deal on Slack!' and a button labeled 'Get Your Copy', accompanied by a preview of the guide featuring Slack's logo.Monday Pricing Guide by cloudeagle.ai offering exclusive pricing secrets to maximize investment with a call-to-action button labeled Get Your Copy and an image of the guide's cover.Blue banner for Canva Pricing Guide by cloudeagle.ai offering a guide to Canva costs, features, and alternatives with a call-to-action button saying Get Your Copy.Blue banner with white text reading 'Little-Known Negotiation Hacks to Get the Best Deal on Slack' and a white button labeled 'Get Your Copy'.Blue banner with text 'Little-Known Negotiation Hacks to Get the Best Deal on Monday.com' and a white button labeled 'Get Your Copy'.Blue banner with text 'Little-Known Negotiation Hacks to Get the Best Deal on Canva' and a white button labeled 'Get Your Copy'.Banner with text 'Slack Buyer's Guide' and a 'Download Now' button next to images of a guide titled 'Slack Buyer’s Guide: Features, Pricing & Best Practices'.Digital cover of Monday Pricing Guide with a button labeled Get Your Copy on a blue background.Canva Pricing Guide cover with a button labeled Get Your Copy on a blue gradient background.

Enter your email to
unlock the report

Oops! Something went wrong while submitting the form.
License Count
Benchmark
Per User/Per Year

Enter your email to
unlock the report

Oops! Something went wrong while submitting the form.
License Count
Benchmark
Per User/Per Year

Enter your email to
unlock the report

Oops! Something went wrong while submitting the form.
Notion Plus
License Count
Benchmark
Per User/Per Year
100-500
$67.20 - $78.72
500-1000
$59.52 - $72.00
1000+
$51.84 - $57.60
Canva Pro
License Count
Benchmark
Per User/Per Year
100-500
$74.33-$88.71
500-1000
$64.74-$80.32
1000+
$55.14-$62.34

Enter your email to
unlock the report

Oops! Something went wrong while submitting the form.

Enter your email to
unlock the report

Oops! Something went wrong while submitting the form.
Zoom Business
License Count
Benchmark
Per User/Per Year
100-500
$216.00 - $264.00
500-1000
$180.00 - $216.00
1000+
$156.00 - $180.00

Enter your email to
unlock the report

Oops! Something went wrong while submitting the form.

Get the Right Security Platform To Secure Your Cloud Infrastructure

Please enter a business email
Thank you!
The 2023 SaaS report has been sent to your email. Check your promotional or spam folder.
Oops! Something went wrong while submitting the form.

Access full report

Please enter a business email
Thank you!
The 2023 SaaS report has been sent to your email. Check your promotional or spam folder.
Oops! Something went wrong while submitting the form.

Procurement Teams: Say Goodbye to Surprise Clauses.

Use this checklist to align with legal, IT, and finance before the deal is sealed.

Grab Free Checklist
CTA Thumbnail

Think your SaaS contract is locked in just because the legal team signed off? You might want to double-check that.

According to Gartner, SaaS spending is growing at nearly 19% year over year but many teams still don’t know which terms can be negotiated, or how to avoid hidden renewal risks and usage-based charges that quietly inflate spend.

This SaaS agreement checklist breaks down 10 contract terms worth reviewing before signing or renewing your next SaaS deal. From user access limits to data ownership, we’re covering what matters and why it can cost you if ignored.

TL;DR 

  • SaaS contracts aren’t just legal paperwork; they define usage rights, renewal timelines, penalties, data ownership, and service expectations. Missed terms can quietly inflate your spend.
  • Most buyers skip reading the fine print. Yet, 91% of Americans don’t read agreements, and that’s a risk when handing over sensitive data or relying on uptime guarantees.
  • This checklist covers 10 key areas, including access limits, SLAs, renewal clauses, termination policies, and billing metrics, so you can review and renegotiate smarter.
  • Tools like CloudEagle can automate it all from extracting contract metadata to managing renewals, usage tracking, and vendor negotiations, giving your team full visibility and control.

What is a SaaS agreement?

A SaaS agreement is a legal contract between the software provider and the customer, specifically outlining the framework for accessing and using cloud-based software. Understanding the essentials of a SaaS agreement is key when evaluating software delivered through a subscription model.

  • Defines terms for accessing and using the software over the internet
  • Details subscription duration, pricing, and service level expectations
  • Outlines data security measures and intellectual property rights

The SaaS contracting process is often managed by legal professionals to ensure both clarity and regulatory compliance.

  • Drafts terms and conditions based on SaaS delivery and usage
  • Includes a privacy policy and usage requirements
  • Specifies user restrictions and a termination policy
  • Covers geographical usage policies

A SaaS license agreement further clarifies important topics such as intellectual property rights, confidentiality, limitation of liability, and conditions with direct or indirect impacts on your business.

  • Requires acknowledgment and acceptance of all terms
  • Necessitates signing the contract and providing consent before use

However, it's essential to note that most buyers tend to skip reading the SaaS license agreement, which can lead to oversight of critical details.

Buyers don’t read SaaS license agreements

According to research from Deloitte, a staggering 91% of Americans never read the agreements they sign, this includes critical documents like SaaS agreements.

Remember, this SaaS solution could become a long-term part of your tech stack. It may interact with customer data, proprietary intellectual property, and essential revenue-generating processes.

If you miss critical details in the agreement’s fine print, you could be opening the door to avoidable risks, costly compliance issues, and challenging clean-up efforts in the future.

Why do you need a SaaS Subscription Agreement as a buyer?

‍A SaaS agreement serves as a common ground for software providers and customers. It works as a legal shield from the software providers’ perspective that details all obligations for the end users. Proper saas contracting ensures both parties understand these responsibilities clearly.

The SaaS vendor can even hold the customers accountable in cases of service misuse or violation of agreement terms, as per the applicable law.

Users need to understand the obligations and terms of usage in a SaaS agreement. The agreement for customers generally lists service-level guarantees, licensing requirements, terms of use and permit, how your data is stored or used, and certain restrictions.

Some of the crucial aspects you need to check in a SaaS agreement are:

  • How does the vendor define the data collected and stored on their servers?
  • How does the provider collect the data?
  • The type of data collected and the duration for which the data is stored
  • Will the company erase the data once you stop using the services?
  • Who has ownership of the data?
  • Is there an indemnification clause included in the SaaS contract?
  • What is the penalty for breaching the contract?
  • Who will be held accountable in the event of a data breach?

You need to find the answer to these questions in your SaaS contract agreement. A SaaS agreement helps buyers know about data management, liability, and SaaS usage terms.

Reading the cloud service agreement conditions before accepting them can be daunting; include a legal team during the contract, and follow this SaaS contract agreement checklist to make the process easier.

What are the components of a SaaS contract?

Before signing a SaaS agreement, buyers should systematically review these essential components to ensure proper protections and clear service expectations. Each element represents a critical area where vague terms can lead to disputes or unexpected costs.

  • Parties & Scope of Services: Verify all covered services, features, and any geographic or use restrictions that may limit deployment
  • License and Access Rights: Confirm user count limits, named vs. concurrent licensing, and whether usage restrictions align with your intended use
  • Data Ownership & Processing: Ensure you retain ownership of your data and understand vendor's rights to use it for analytics or AI training
  • Security & Compliance: Validate certifications (SOC 2, ISO 27001, GDPR) match your compliance requirements and check breach notification timelines
  • SLAs & Support: Review uptime commitments, support availability, response SLAs, and financial remedies for service failures
  • Pricing & Fees: Check for hidden costs, annual price increases, overage charges, and whether professional services are included or extra
  • Consumption/Billing Metrics: Understand how usage is measured (per user, API calls, storage) and what triggers additional charges
  • Term & Renewal: Note contract length, auto-renewal clauses, and required notice period (typically 30-90 days before renewal)
  • Termination & Exit: Verify termination rights, early exit penalties, data export procedures, and timeline for data deletion
  • IP & Confidentiality: Clarify who owns customizations, integrations, and ensure mutual confidentiality protections
  • Liability & Indemnity: Understand liability caps and negotiate for adequate coverage relative to contract value and risk exposure
  • Audit & Verification: Confirm your rights to audit usage, verify security controls, and review vendor's compliance documentation
  • Governing Law & Disputes: Check jurisdiction for legal disputes and whether arbitration or litigation is required

What is a SaaS Agreement Checklist

‍A SaaS agreement checklist plays a crucial role in ensuring transparency and effective management of your SaaS subscriptions. 

It covers essential elements like contract duration, subscription terms, user access rights, data ownership and protection, SLAs, pricing structures, payment terms, and termination conditions. Having a detailed checklist streamlines negotiations, strengthens contract oversight, and reduces potential risks.

Key elements typically included in a SaaS agreement checklist:

  • Contract duration – Start and end dates of the subscription.
  • Subscription terms – Monthly vs. annual billing, renewal conditions.
  • Access rights – Who can access the service, and how permissions are managed.
  • Data ownership – Clear terms on who owns the data and what happens upon termination.
  • Data security – Compliance with industry standards like SOC 2, GDPR, HIPAA, etc.
  • Service Level Agreements (SLAs) – Uptime guarantees, support response times, and performance metrics.
  • Pricing and payment – Detailed fee structure, additional costs, and payment timelines.
  • Termination clauses – Exit terms, notice periods, and any penalties involved.

Which key clauses should every SaaS agreement include?

A thorough SaaS agreement checklist is essential for ensuring your data is protected, costs are predictable, and you maintain control over your software relationship. Carefully evaluating the following areas before signing will help you avoid common pitfalls and secure favorable terms:

  • Data Protection & Processing: Review data processing clauses, including details on subprocessor involvement and specific data storage locations. Ensure the agreement outlines how your data will be handled and protected.
  • Security Commitments: Expect explicit commitments around encryption standards, breach notification timelines (ideally 24-48 hours), and adherence to security certifications such as SOC 2 or GDPR. Confirm how security incidents will be communicated and managed.
  • Service Levels & Uptime: Look for clear uptime guarantees, typically 99.9% or higher, backed by meaningful remedies like service credits rather than general apologies. The SLA should clearly define how downtime is measured and compensated.
  • Support & Response Times: Support terms should specify response times based on issue severity, with escalation paths in place to address urgent concerns quickly.
  • Pricing & Financial Terms: Negotiate caps on price increases, clarify procedures for true-ups on license overages, and ensure you fully understand usage metrics that may lead to additional charges.
  • Renewal & Termination: Pay close attention to renewal clauses, insist on at least 90-day notice periods and secure the right to terminate for convenience, not just for cause. Make sure you can easily exit the agreement if your needs change.
  • Data Portability & Deletion: Confirm you can export your data in accessible formats upon termination, and establish clear timelines for when your data will be deleted after exit.
  • Red Flags to Watch For: Be wary of vague liability limitations benefitting only the vendor, one-sided indemnification clauses (you should be covered in case of vendor IP issues or data breaches), and unilateral terms changes. Protect your interests by negotiating balanced terms.
  • Audit Rights & IP Ownership: Secure audit rights to verify compliance and usage. Make sure the agreement explicitly states that you retain ownership of your data.
  • Contract Tracking: Before signing, extract key contract metadata, including renewal dates, notice periods, and pricing terms, into a contract management or tracking system to prevent unwanted auto-renewals or missed deadlines.

By following this SaaS agreement checklist, you can minimize risks, maintain control over your data, and create a stable, cost-effective partnership with your SaaS provider.

The 10-Point SaaS Agreement Checklist You Can’t Ignore

Image showing sub-headings of SaaS agreement checklist

1. Start and End Dates

The start date is when the SaaS agreement officially becomes active. From the agreement start date, the SaaS application becomes available for use by individuals or companies that purchased it.

The SaaS agreement’s end date refers to the renewal or termination of the subscription. To ensure a smooth user experience and prevent application downtime, it's crucial to stay vigilant about tracking start and end dates.

Tracking the end date of the SaaS subscription agreement is essential for the sales teams to negotiate the contract upgrade or renewal terms.

Sales reps can help companies get the best value from a SaaS subscription. Planning the renewal negotiation strategy ahead of the curve is always profitable for companies, and this is possible only if the contract dates are tracked effectively.

Also check:

  • If the contract is set to auto-renew
  • Whether there are penalties or fees for missing the renewal window

This small detail can lead to big savings and avoid paying for unused software in 2025.

2. Access Rights and Users

The next vital aspect of a SaaS agreement checklist is access rights and users. Most agreements cap the number of users accessing the software, and this limit varies depending on the pricing plan.

Most basic SaaS agreements come with a single-user license, which means multiple users can’t access the platform under the same contract. While buying the subscription, you should know this parameter, it can help you avoid unnecessary costs.

If you have more team members:

  • Consider upgrading to an enterprise plan
  • Ask the provider to customize the agreement based on your usage
  • You might be eligible for a volume discount

You also need to check:

  • Penalties for exceeding the user limit
  • Data entitlements tied to the plan
  • Whether violating usage policies could result in service suspension or contract termination

Some vendors enforce their terms strictly, so it’s important to understand what your plan includes and what it doesn’t.

3. Customer Support and Services

In the SaaS agreement checklist, customer support plays a critical role in delivering a smooth user experience, especially during onboarding or unplanned downtime.

Before you choose a SaaS application, read the customer support and service clauses carefully. Some vendors offer phone support, others provide 24×7 email support, and a few include both.

Here’s what you should check:

  • How support is delivered (email, phone, live chat)
  • Whether support is available during your working hours
  • Average response time, especially if you're in a different time zone

Also, look for onboarding and technical assistance. If it's not included by default, request the vendor to add it either as part of the agreement or within the pricing structure.

Support quality isn’t just a nice-to-have. It directly affects your team’s ability to use the product effectively.

4. Data ownership and usage

Data ownership comes with legal weight and should never be overlooked when subscribing to a new SaaS tool. This point of the SaaS agreement checklist should clearly state whether a SaaS agreement includes:

  • How the vendor collects and stores data
  • What data ownership looks like during and after the contract period

The agreement should confirm whether the uploaded or generated data belongs to you (the customer), or if the vendor retains ownership. Some vendors may claim ownership but allow retrieval after termination – read this part carefully.

This section is often a gray area, where vendors include surface-level language but bury important clauses deeper in the document. Don’t skip the details.

Data Usage

If the vendor retains any rights to your data, check how they plan to use it. In some cases, they might:

  • Use customer data to improve their services
  • Feed usage data into AI models or analytics

You can restrict this if it involves sensitive information like:

  • Patents
  • Source code
  • Trade secrets
  • Customer or financial data

In the EU, regulations like GDPR offer some protection. But in other regions, vendors may collect and use broader datasets unless you explicitly limit them.

To stay compliant in 2025, make sure the data usage clause is clearly defined and aligned with your internal policies before you sign.

5. SaaS subscription/renewal notice period

SaaS renewal is one of the most overlooked details in a SaaS agreement checklist and often the most frustrating.

Vendors should clearly define the notice period and specify a deadline for users who don’t want to renew automatically. If a user chooses not to renew, they must notify the vendor before the notice period stated in the agreement.

For example, if the SaaS agreement requires 30 days’ notice, subscribers must inform the vendor within that timeframe whether they plan to renew or not.

The real challenge? Most enterprises use over 100 SaaS apps – all with different renewal terms. Managing these manually is time-consuming, error-prone and often leads to unexpected auto-renewals.

A 30-day notice is the most common, but some contracts specify 15, 60, 90, or even 180 days. Without a formal process, it’s easy to miss deadlines and pay for services you no longer need.

A key SaaS renewal best practice is to ensure the notice period is clearly stated in the contract. Negotiate for a 90-day window if possible to give your team time to evaluate the tool before it renews. Use a centralized contract management system to track all agreements and automate renewal workflows.

Here’s Pratibha Mehta from Falkonry, recalling her experience with CloudEagle.ai and how it helped her team streamline SaaS renewals:

6. Total SaaS Contract Value

It’s important to know the total contract value and the amount you’ll pay for the full renewal cycle, not just the monthly or annual fee.

The total contract value includes all financial obligations tied to a SaaS agreement across business units. Having a clear view of this gives you an edge when evaluating vendor performance or negotiating renewals.

There are often gaps between what was initially agreed to and what actually ends up being billed.

For example, if your contract states $20,000 but the invoice shows more, it’s worth investigating. The increase could be due to:

  • Additional active users beyond the license
  • Overage charges
  • Opt-ins for new features
  • Trial tools that were never canceled but renewed automatically

That’s why it’s smart to review SaaS contracts regularly and track:

  • App usage
  • Extra feature add-ons
  • Any hidden or compounding costs

Instead of managing this manually, use a SaaS spend management platform like CloudEagle.ai to monitor usage, flag redundancies, and surface insights.

With usage data in hand, you can optimize spend, avoid surprise charges, and enter renewal talks with better leverage.

7. Service Level Agreement

SLA is a significant aspect of SaaS agreements you should check while subscribing to a new service.

Typically, all SaaS agreements come with a comprehensive SLA section covering the services vendors ought to provide, including the different performance standards and usability criteria.

The best thing about SLAs is that the vendors must meet the requirements.

For example, most SaaS agreements offer a 99% uptime percentage, and if the vendor fails to meet it, you can hold them accountable if stated in the SLA.

Suppose you face frequent service interruptions or sluggish performance. In that case, you can report your issues to the company and ask them to make reasonable efforts to resolve them as soon as possible.

Response time is a crucial service level agreement clause that defines the turnaround time for any problem resolution from the vendor side. This clause plays a significant role if you have a substantial dependency on that SaaS.

Subscribe to SaaS agreements only if you are comfortable with their service terms and performance standards.

8. Consumption Metrics and Billing Units

In SaaS agreements, "consumption metrics" are a set of parameters used to measure the usage of the SaaS application. You need to pay close attention to this clause as it’ll help you understand how the vendor will bill you during contract renewals.

The vendor might charge based on:

  • Per-user
  • Per-feature
  • Actual usage volume

Understanding this structure is critical. Without visibility into consumption patterns, teams often end up paying for licenses or features they don’t fully use.

For finance teams and business owners, managing these billing units effectively helps control SaaS expenses. Instead of relying on manual checks, consider using a SaaS management platform like CloudEagle to:

  • Track consumption metrics
  • Flag underused apps or plans
  • Make informed decisions during negotiations

Before signing a SaaS subscription agreement, carefully review how billing is calculated. The consumption metrics and associated charges should be clearly defined and easy to interpret. This ensures you’re only paying for what you actually use and not getting hit with surprises during renewals.

9. Data Handling and Regulatory Compliance

Data handling is another critical aspect that shouldn’t be overlooked in a SaaS agreement checklist.

Data protection plays a central role in SaaS operations, and vendors are expected to comply with relevant regulatory standards when processing personal or corporate data.

You need to know:

  • How your vendor stores, manages, and uses your data
  • Whether they follow the appropriate compliance frameworks

No buyer wants to be locked into a contract with a vendor who can’t guarantee data security. With regulations like GDPR, CCPA, PCI DSS, and SOC II, many organizations are legally required to work only with compliant providers.

Make sure the vendor’s product aligns with the latest security and compliance standards before signing anything. If you're operating in a region or industry with stricter requirements, confirm that the vendor also complies with exclusive jurisdiction rules relevant to your business.

The SaaS agreement should clearly outline:

  • What standards apply
  • What compliance certifications the vendor holds
  • How data will be handled under those regulations

Don’t assume compliance is a given; get it in writing.

10. Termination policy

We’ve reached the final point in the SaaS agreement checklist. A SaaS contract is incomplete if it doesn’t clearly define the termination clause or policy.

Every vendor will have their own set of rights and conditions that customers must follow. These policies often vary depending on the type of subscription your team is using.

A termination clause should clearly specify:

  • Penalties for early contract termination
  • Notice period required for cancellation
  • Auto-renewal conditions, in case no termination notice is provided
  • Data retention and migration steps
  • Any post-termination commitments

Most vendors will state that you don’t own the data during the contract period. So when it’s time to terminate, your team needs to clarify:

  • How the data will be returned or migrated
  • How long the vendor will retain your data
  • What security protocols will be followed after termination

Image showing the Adobe's penalty

Some vendors may also include hidden charges, especially if licensing rights were breached or services are auto-renewed without clear notice. Ask upfront about these penalties and get written confirmation before signing.

A SaaS contract is only complete if these elements are transparent. If you spot vague, redundant, or unclear clauses, don’t ignore them. Clarify or renegotiate.

How do you develop a SaaS agreement?

Developing a comprehensive SaaS agreement checklist requires a structured approach that balances better compliance with operational efficiency. Start by defining your use cases and identifying all stakeholders across IT, procurement, legal, and business units who will interact with the agreement.

  1. Map data flows and compliance requirements – Document how data will be collected, stored, and processed, ensuring alignment with GDPR, SOC 2, or other relevant standards.
  2. Select licensing models and billing metrics – Choose between per-user, usage-based, or tiered pricing structures that match your organization's needs.
  3. Draft scope, SLAs, and support terms – Define service levels, uptime guarantees, response times, and support channels clearly.
  4. Set renewal and notice periods – Establish clear timelines (typically 30-90 days) to avoid auto-renewals and allow proper evaluation.
  5. Plan termination and data exit procedures – Specify how data will be returned, deleted, and migrated upon contract end.
  6. Align security and privacy appendices – Include data processing agreements and subprocessor disclosures.
  7. Finalize pricing protections – Lock in rate caps, volume discounts, and usage overage terms.
  8. Run legal and procurement reviews – Ensure all stakeholders approve terms before signature.
  9. Implement contract metadata tracking – Use centralized systems to monitor renewal dates, pricing, and key terms automatically.

Pre-signature checklist: Verify all pricing terms are documented, compliance certifications are current, termination clauses are clear, and renewal dates are tracked in your management system.

How to write a SaaS license agreement

Drafting a thorough SaaS license agreement is essential for protecting both the provider and the customer, as well as ensuring regulatory and operational requirements are met. By following a clear SaaS agreement checklist, you can address all critical aspects of the contract to reduce legal risks and build trust between parties.

  • Service Levels: Define performance standards, uptime guarantees, and support response times to clarify expectations and obligations.
  • Data Protection: Set out responsibilities for safeguarding customer data, including security measures, data privacy compliance, and breach notification protocols.
  • Termination Clauses: Outline the conditions under which either party can terminate the agreement, along with notice requirements and any associated penalties.
  • Licensing Terms: Specify how the software can be used, including any restrictions on users, locations, or activities.
  • Payment Schedules: Clearly state the payment terms, billing intervals, renewal conditions, and procedures for late or missed payments.
  • Liability Limitations: Set limits on each party’s liability for damages, losses, or service interruptions to protect against unforeseen events.
  • Compliance Requirements: Ensure the agreement addresses relevant legal, industry, and regulatory obligations for your business and customers.

Using this SaaS agreement checklist helps create a comprehensive, enforceable contract that supports a positive business relationship and ongoing compliance.

SaaS Agreement Vs. Software License: Know the Difference

Feature SaaS Agreement Software License
Access Model Subscription-based; vendor hosts software One-time or periodic license fee; software installed on buyer's systems
Ownership Vendor retains ownership Buyer owns the license (not the software itself)
Maintenance & Upgrades Vendor handles maintenance, updates, and security Buyer is responsible for maintenance and security
Geographic Limitations Usually not restricted by region Can be exclusive or non-exclusive to specific regions
Installation Used via the cloud; no installation or configuration needed Requires installation and configuration before use
Usage Duration As long as the subscription or SaaS contract is active Typically perpetual, unless otherwise specified

CIOs: Your Teams Are Only Using 62% of What You’re Paying For

Learn how to automate license right-sizing and reinvest what you save.

Get the Free License Management eBook
CTA Thumbnail

What types of SaaS licensing agreements exist?

SaaS licensing agreements offer various models, each impacting your SaaS agreement checklist and budget planning. Choosing the right model aligns costs with your actual usage and organizational needs.

  • Per-User Licensing: Charges are based on individual users, either as named licenses (assigned to specific people) or concurrent licenses (shared within a user pool). Easy to budget, but requires tracking user counts and managing true-ups for additional users.
  • Usage-Based Pricing: Costs depend on measurable consumption such as API calls, data storage, or transactions. Offers flexibility, but can result in variable monthly costs—requires strong oversight on usage and clear overage policies.
  • Tiered Pricing: Features are bundled into packages (like basic, professional, or enterprise). Good for scaling, but may include features you don’t use.
  • Enterprise/Elastic Licensing: Provides volume discounts and allows flexible allocation across teams or locations. Ideal for large organizations but can complicate renewals if usage patterns shift.
  • Freemium-to-Paid Upgrades: Starts with a free plan and upgrades as needs grow. Reduces initial cost but can lead to unmanaged sprawl if upgrades aren’t monitored.

When selecting a licensing model, consider:

  • User growth forecasts and how easily you can track users or usage
  • Usage predictability versus budget flexibility
  • Internal governance for monitoring consumption and renewals
  • Negotiating terms for true-ups, notice periods, and downgrade rights to maintain control during renewals

Top SaaS Agreement Examples Every Buyer Should See

When evaluating SaaS agreements, buyers need practical templates and real-world examples to guide their negotiations. Here are three proven resources that provide actionable insights for your next software purchase:

Salesforce Master Services Agreement (MSA)

As the world's leading CRM platform, Salesforce's MSA sets industry standards for enterprise SaaS contracts. Their Service-Level Agreement defines "service levels, performance metrics, responsibilities, and non-compliance consequences. This comprehensive approach helps buyers understand how to structure accountability measures and performance guarantees in their own saas contracting priocesses.

Microsoft Azure Online Subscription Agreement

Microsoft's Azure agreement demonstrates how cloud infrastructure providers handle complex service delivery commitments. The agreement covers "online services use, purchasing services, warranties, and more. This template is particularly valuable for understanding how to negotiate terms for mission-critical cloud services and data handling provisions.

Slack Main Services Agreement

Slack's agreement offers a clear example of how communication platforms balance user rights with service obligations. Their terms detail and clarify your rights and responsibilities when using Slack. This straightforward approach helps buyers understand how to negotiate clarity around data ownership, security requirements, and usage limitations.

What are the legal requirements and best practices for SaaS agreements?

Ensuring strong legal compliance and clear operational terms are key for any SaaS agreement. Use this checklist to guide your contract process:

  • Verify vendor compliance with regulations like GDPR, CCPA, SOC 2, and PCI DSS when handling data.
  • Include Data Processing Agreements (DPAs) covering subprocessor disclosures, data residency, and cross-border transfers.
  • Set security controls, including breach notification timelines (usually 24–72 hours) and accessibility standards.
  • Define uptime guarantees backed by robust Service Level Agreements (SLAs).
  • Ensure fair limitation of liability and indemnification clauses for both parties.
  • Clearly outline ownership of intellectual property, especially for customer data and derivative works.
  • Add audit rights so customers can confirm vendor security practices without disrupting business.
  • Specify change management procedures for contract changes, price updates, and feature removals, including advance notice periods.
  • Maintain all agreements in a centralized contract repository with automated renewal notifications at least 90 days out.
  • Conduct regular compliance audits, set clear breach notification steps, and define exit processes—covering data return, deletion, and transition support.
  • Schedule ongoing access reviews to ensure contract terms match actual usage, reducing risk and wasted spend.

Use a SaaS Management Platform to Handle Agreements at Scale

Image showing SaaS apps functionalities

Reviewing SaaS contracts manually is time-consuming, and it only gets harder as your portfolio grows. But ignoring renewal clauses, termination terms, or usage caps isn’t an option. These details impact spend, compliance, and business continuity.

That’s why growing teams use a SaaS management platform like CloudEagle to centralize contracts, streamline renewals, and automate every part of the subscription lifecycle.

See how Aira centralized their SaaS contracts using CloudEagle.

Here’s how it helps:

Contract Management made simple

Centralize all your SaaS contracts in one place no more scattered PDFs, inbox digging, or version confusion.

  • CloudEagle.ai uses AI-powered metadata extraction to pull key terms like renewal dates, notice periods, pricing, usage limits, and termination clauses from your contracts automatically.
  • Contracts become searchable, sortable, and actionable in seconds.
  • During renewals or audits, your team has everything it needs without legal bottlenecks.

get contract information

Aira now retrieves contracts instantly during renewals, saving time and avoiding compliance gaps.

Renewal Management You Can Rely On

CloudEagle automatically builds a renewal calendar using extracted metadata.
You can:

  • Set up workflows that trigger 90 days before renewal
  • Route approvals to stakeholders
  • Avoid last-minute negotiations or unwanted auto-renewals

get customised renewal alerts

All of this takes the stress out of saas contracting renewals.  Check out how Wefunder automated their renewals using CloudEagle.ai.

Stronger Negotiations, Backed by Data

Contract renewals aren’t just admin, they’re an opportunity to cut costs and improve terms.

With CloudEagle.ai, you get:

  • Real-time usage insights tied to each contract
  • Benchmarking data to counter vendor pricing
  • Visibility into underutilized licenses you can cut

get negotiation data of specific apps

When your finance, IT, and procurement teams come to the table, they come prepared.

Need Help Negotiating? We’ll Handle It for You

Short on time or expertise? CloudEagle.ai offers assisted buying.

Our negotiation experts handle vendor communication, review agreements, and secure better pricing based on your usage patterns so your team can stay focused on strategic work. 

get expert negotiation insights

From procurement and contract visibility to renewals, negotiation, and compliance, CloudEagle is the all-in-one solution to streamline SaaS management.

🎧 Listen to Terry Larock, Head of Procurement at Tipalti, as he shares how he mastered SaaS procurement and secured the best deals for his company.

Key SaaS Agreement Terms to Negotiate Successfully

When reviewing your SaaS agreement checklist, it's essential to focus on negotiating the terms that will have the greatest impact on your organization's security, operational continuity, and return on investment. A well-negotiated SaaS contract not only protects your interests but also ensures you receive the level of service and flexibility your business needs as it grows. Here are the key areas to prioritize during negotiations:

  • Data Security: Make sure the agreement outlines robust data protection measures, compliance requirements, and clear responsibilities for managing and reporting data breaches.
  • Service Level Agreements (SLAs): Negotiate detailed SLAs that define uptime guarantees, response times, and remedies for service disruptions, helping to minimize business risks.
  • Termination Clauses: Clarify the conditions under which you or the vendor can terminate the contract, including notice periods, exit procedures, and data retrieval rights to support a smooth transition if necessary.
  • Pricing Structures: Seek transparency in subscription fees, renewal terms, and pricing adjustments to avoid unexpected costs and maintain budget control over the term of the agreement.
  • Liability Limitations: Evaluate caps on vendor liability, indemnification terms, and exclusions to ensure your organization is adequately protected in case of losses or service failures.
  • Intellectual Property Rights: Define ownership and usage rights for any data or customizations, and confirm your ability to retain access to critical information if the agreement ends.

By systematically addressing these critical terms, you can maximize the value of your SaaS investment and safeguard your organization against potential risks.

Final Word

A well-structured SaaS agreement isn’t optional; it’s protection. That’s why we created this checklist: to help you catch the fine print before it costs you.

CloudEagle.ai simplifies how you manage your SaaS contracts, vendors, and renewals, all in one place. With features like automated vendor discovery, usage-based negotiation support, and renewal workflows, it helps you control spending and stay compliant.

Whether you're a fast-scaling startup or an enterprise managing hundreds of apps, CloudEagle.ai gives you the visibility and control to make smarter decisions.

Top IT Teams Follow These SaaS Management Practices to Save $2M+ Annually.

Grab the detailed guide that helps IT leaders optimize their entire SaaS portfolio efficiently.

Get The Management Guide
CTA Thumbnail

‍Frequently Asked Questions 

1. What should be included in a SaaS agreement?

It should include contract duration, pricing, SLAs, data ownership, security terms, access rights, renewal terms, and termination clauses.

2. How to review SaaS agreements?

Review terms for pricing, SLAs, data rights, renewal policies, and exit clauses. Use a checklist to ensure clarity and risk coverage.

3. What is the difference between SLA and SaaS agreement?

A SaaS agreement covers the full contract, while an SLA focuses specifically on service performance, uptime, and support expectations.

4. What are the essentials of a service agreement?

Key essentials include the scope of services, performance metrics, payment terms, responsibilities, dispute resolution, and termination rights.

CloudEagle.ai recognized in the 2025 Gartner® Magic Quadrant™ for SaaS Management Platforms
Download now
gartner chart
5x
Faster employee
onboarding
80%
Reduction in time for
user access reviews
30k
Workflows
automated
$15Bn
Analyzed in
contract spend
$2Bn
Saved in
SaaS spend

Recognized as an Industry leader for our AI

CloudEagle.ai is Recognized in the 2024 Gartner® Magic Quadrant™ for SaaS Management Platforms

Recognition highlights CloudEagle’s innovation and leadership in the rapidly evolving SaaS management and procurement space.
Read More
Gartner Magic Quadrant for SaaS Management Platforms showing a chart divided into Challengers and Leaders quadrants with various companies plotted as dots.

CloudEagle.ai Recognized in the GigaOm Radar for SaaS Management Platforms

CloudEagle named a Leader and Outperformer in GigaOm Radar Report, validating its impact in the SaaS management platform landscape.
Read More
gigaom

Everest Group Positions CloudEagle.ai as a Trailblazer in SaaS Management Platforms

CloudEagle recognized as a Trailblazer by Everest Group, showcasing its rapid growth and innovation in SaaS spend and operations management.
Read More
qks

CloudEagle.ai is Recognized in the 2024 Gartner® Magic Quadrant™ for SaaS Management Platforms

Recognition highlights CloudEagle’s innovation and leadership in the rapidly evolving SaaS management and procurement space.
Read More
gartner

Streamline SaaS governance and save 10-30%

Book a Demo with Expert
CTA image