4 Things To Check On Your MSAs, Contracts & Agreements

Before signing a master service agreement, contract or any other work-related agreement, it’s important to read over the details carefully. Here are four main things to check.

MSAs, Contracts & Agreements

1. Invoice Requirements

The section that states what is required of your invoicing is an important part of your agreement. Examples of invoice requirements include signed delivery receipts, bills of lading, field tickets and time sheets. Your customer may require certain backup which if not provided, could hold up payment.

2. Insurance Requirements

Your agreements will usually include a section that details the insurance coverages required for your company to start and continue work with your customer. If you’re unsure if you have certain limits or endorsements on your policies, it’s best to check with your insurance agent. It’s important that your company is adequately insured in the event there are any potential claims.

3. Subcontractor Requirements

Many agreements will require you to obtain prior approval from your customer before hiring subcontractors. They may also require your subcontractors to maintain the same levels of insurance that is required by your company as stated in your agreement. It’s also important that your company has a comprehensive subcontractor agreement that covers any potential areas of dispute with your hired subcontractors.

4. Lien Waivers

If the work that you’re doing requires lien wavers, this is often noted. Lien waivers are a form of protection that is signed to confirm any contractors, subcontractors, materials or other parties have received payment and waive their right to any future lien. Failing to sign lien waivers can lead to problems down the line if there are any disputes on payments.

 Checklist: 4 Essential Contract Clauses to Review

• Indemnification (Risk Allocation)
  • Look for “mutual” indemnification rather than one-sided language.
  • Ensure your business isn’t absorbing undue liability for mistakes made by the other party.
  • Verify that the financial exposure aligns with your business insurance policy limits.
• Payment Terms & Late Fees
  • Clearly identify the payment window (e.g., Net 30, Net 60) and verify that it matches your actual cash flow needs.
  • Check for hidden penalties, interest rates on overdue invoices, or clauses that allow the vendor to abruptly halt work due to a late payment.
  • Look for explicit language defining how billing disputes are handled.
• Termination & Renewal Provisions
  • Review the “Termination for Convenience” clause to see how much written notice (e.g., 30, 60, or 90 days) either party must give to walk away without penalty.
  • Watch out for evergreen clauses (automatic renewals) that lock you into another year of service if you miss a narrow cancellation window.
  • Define the “Termination for Cause” parameters—what constitutes a breach, and how many days does the offending party have to fix it (cure period)?
• Scope of Work (SOW) & Change Orders
  • Ensure the deliverables, milestones, and deadlines are highly specific, leaving no room for interpretation or “scope creep.”
  • Check the exact mechanism for changing the scope: Does it require written approval from both parties, or can changes be authorized via a simple email?
  • Clarify who owns the intellectual property (IP) or final work product once the contract terminates.

 

Your Scale Funding team is happy to review any agreements you have.