Glossary

Plain-English definitions of the SOW, RFP, and contract terms that matter most when reviewing a document before you sign.

• Deliverable Acceptance Criteria

  Acceptance criteria are the specific, testable conditions a deliverable must meet before the client is obligated to accept it and payment is triggered.

• Fixed-Price Contract

  A fixed-price contract sets a single agreed price for a defined scope of work, regardless of how many hours or resources it actually takes to deliver.

• Force Majeure

  A force majeure clause excuses a party from contractual obligations, without penalty, when performance is prevented by extraordinary events outside its reasonable control.

• Indemnification Clause

  An indemnification clause requires one party to compensate the other for losses, damages, or legal claims arising from specific events, such as IP infringement or a data breach.

• Liability Cap

  A liability cap is a contract clause that limits the total amount one party can be required to pay the other if something goes wrong.

• Limitation of Liability

  Limitation of liability is the broader category of contract language that restricts what a party can be held responsible for -- of which a dollar-amount liability cap is one specific mechanism, not the whole clause.

• MSA (Master Service Agreement)

  An MSA is a foundational contract between two parties that sets the general legal and commercial terms governing all future work, with specific projects then defined in separate SOWs.

• RFI (Request for Information)

  An RFI is a preliminary document a buyer sends to vendors to gather information about their capabilities, approach, or market offerings, without asking for a priced proposal.

• RFP (Request for Proposal)

  An RFP is a formal document a buyer issues to solicit priced, competitive proposals from vendors for a defined piece of work, evaluated against stated criteria.

• Scope Creep

  Scope creep is the uncontrolled expansion of a project's deliverables or requirements beyond what was originally agreed, usually without a corresponding adjustment to budget or timeline.

• SLA (Service Level Agreement)

  An SLA is a defined commitment for the level of service a vendor will provide on an ongoing basis, typically stating response times, resolution times, and uptime targets.

• SOW (Statement of Work)

  A Statement of Work (SOW) is a document that defines the specific scope, deliverables, timeline, and price for a project, typically issued under a broader MSA or as a standalone contract.

• Termination for Convenience

  A termination-for-convenience clause lets either party end the contract without cause -- for any reason or no reason -- typically subject to a defined notice period.

• Time-and-Materials Contract

  A time-and-materials (T&M) contract bills the client based on actual hours worked and materials used, at agreed rates, rather than a single fixed price for the whole scope.

• Warranty Clause

  A warranty clause commits the vendor to fixing defects in delivered work, at no extra cost, for a defined period after delivery -- and separately, often disclaims other implied warranties.