Service Level Agreement (SLA) Template

1. Parties and Effective Date

This Service Level Agreement (the "SLA" or "Agreement") is made and entered into as of [EFFECTIVE_DATE] (the "Effective Date") by and between [CLIENT_NAME], a [CLIENT_ENTITY_TYPE] organized under the laws of [CLIENT_JURISDICTION], with its principal place of business at [CLIENT_ADDRESS] (the "Customer"), and [SERVICE_PROVIDER_NAME], a [PROVIDER_ENTITY_TYPE] organized under the laws of [PROVIDER_JURISDICTION], with its principal place of business at [PROVIDER_ADDRESS] (the "Service Provider"). The Customer and the Service Provider are each a "Party" and collectively the "Parties". This SLA forms part of, and is incorporated by reference into, the Master Services Agreement dated [MSA_DATE] between the Parties (the "Master Agreement"); in the event of any conflict between this SLA and the Master Agreement, the terms of this SLA shall prevail with respect to service levels and the remedies for failure to meet them.

2. Purpose and Scope

The purpose of this SLA is to establish a mutually understood set of performance standards governing the delivery of [SERVICE_NAME] (the "Service") by the Service Provider to the Customer, together with the measurement methodology, reporting cadence, financial remedies for under-performance, and governance procedures. The scope of this SLA covers (a) the Service components listed in Section 4 (Service Description), (b) all environments designated as Production, and (c) all Authorized Users of the Customer. This SLA does not cover non-production environments (development, staging, sandbox, or test) unless explicitly stated, nor does it cover any service, feature, or component labelled by the Service Provider as Beta, Preview, Early Access, or Experimental at the time the relevant incident occurs.

3. Defined Terms

For the purposes of this SLA, capitalized terms have the meanings set out below. Terms not defined here have the meanings given in the Master Agreement.

(a) "Authorized User" means an individual employee, contractor, or agent of the Customer who has been provisioned with valid credentials to access the Service.

(b) "Available" means the state in which the Service is operating and accessible to Authorized Users for its intended purpose.

(c) "Business Hours" means [BUSINESS_HOURS_START] to [BUSINESS_HOURS_END] local time in [BUSINESS_HOURS_TIMEZONE], on each day other than a Saturday, Sunday, or public holiday observed in [BUSINESS_HOURS_LOCATION].

(d) "Downtime" means the aggregate number of minutes during a Measurement Period in which the Service is not Available, excluding any minutes attributable to an Exclusion under Section 9.

(e) "Incident" means any unplanned interruption to the Service, reduction in the quality of the Service, or failure of a Service component reported by the Customer or detected by the Service Provider's monitoring systems.

(f) "Maximum Available Minutes" means the total number of minutes in the Measurement Period during which the Service is contractually required to be Available, calculated as the total number of minutes in the calendar month minus the duration of any Planned Maintenance windows correctly notified in accordance with Section 9(a).

(g) "Measurement Period" means each calendar month during the term of this SLA.

(h) "Monthly Uptime Percentage" means the value calculated using the formula in Section 6(a).

(i) "Planned Maintenance" means scheduled maintenance activity affecting the Service for which the Service Provider has provided advance notice in accordance with Section 9(a).

(j) "Resolution Time" means the elapsed time between the Service Provider's acknowledgement of an Incident and the restoration of the Service to an Available state, or the implementation of a workaround mutually acceptable to the Parties.

(k) "Response Time" means the elapsed time between the Customer's submission of an Incident through an approved channel and the Service Provider's first substantive response.

(l) "Service Credit" means a credit, calculated in accordance with Section 7, applied against the Customer's next invoice for the Service.

(m) "Severity Level" means the classification (P1, P2, P3, or P4) assigned to an Incident in accordance with Section 6(b).

4. Service Description

The Service consists of [SERVICE_DESCRIPTION], including without limitation the following components: [LIST_OF_SERVICE_COMPONENTS]. The Service is delivered over [DELIVERY_CHANNEL] and is supported by the Service Provider's infrastructure located at [DATA_CENTRE_LOCATIONS]. A detailed technical specification of the Service is set out in Schedule A (Service Specification), which forms part of this SLA. The Service Provider may from time to time modify the Service for reasons of security, regulatory compliance, or general improvement, provided that no such modification shall materially diminish the functionality or performance of the Service without the Customer's prior written consent.

5. Service Hours and Coverage

The Service shall be Available on a 24 hours per day, 7 days per week, 365 days per year basis ("24x7"), other than during Planned Maintenance and Exclusions. Support coverage by the Service Provider's service desk is provided as follows: (a) P1 and P2 Incidents — 24x7 coverage; (b) P3 and P4 Incidents — Business Hours coverage. The Service Provider shall maintain at least one suitably qualified engineer on call at all times during 24x7 coverage windows. Incidents must be submitted through the approved channels listed in Schedule B (Contact and Escalation Matrix); Incidents submitted through any other channel (including individual email addresses or social-media channels) are not deemed received until logged in the Service Provider's incident-management system.

6. Performance Metrics

(a) Uptime. The Service Provider shall achieve a Monthly Uptime Percentage of at least [UPTIME_TARGET] (the "Uptime Target") for each Measurement Period. The Monthly Uptime Percentage shall be calculated as follows:

Monthly Uptime Percentage = ((Maximum Available Minutes − Downtime) ÷ Maximum Available Minutes) × 100

(b) Severity Classification. Each Incident shall be classified by the Service Provider, acting reasonably and in consultation with the Customer where practicable, into one of the following Severity Levels:

P1 — Critical: The Service is wholly unavailable, or a core function of the Service is unavailable, affecting all or a substantial majority of Authorized Users, with no workaround available; or there is a confirmed security incident involving Customer data.

P2 — High: A material function of the Service is degraded or unavailable, affecting a significant subset of Authorized Users; a workaround may exist but is impractical or commercially unacceptable.

P3 — Medium: A non-critical function of the Service is impaired, affecting a limited number of Authorized Users; a reasonable workaround exists.

P4 — Low: A minor defect, cosmetic issue, request for information, or general enquiry that does not materially impair use of the Service.

(c) Response Time Targets. The Service Provider shall acknowledge each Incident within the following Response Time targets: P1 — within [P1_RESPONSE_TIME], 24x7. P2 — within [P2_RESPONSE_TIME], 24x7. P3 — within [P3_RESPONSE_TIME]. P4 — within [P4_RESPONSE_TIME].

(d) Resolution Time Targets. The Service Provider shall achieve the following Resolution Time targets for each Severity Level: P1 — [P1_RESOLUTION_TIME], 24x7 elapsed. P2 — [P2_RESOLUTION_TIME], 24x7 elapsed. P3 — [P3_RESOLUTION_TIME]. P4 — [P4_RESOLUTION_TIME].

(e) Resolution Time Compliance. The Service Provider shall meet the Resolution Time targets for at least [RESOLUTION_COMPLIANCE_TARGET] of all Incidents within each Severity Level during any Measurement Period.

7. Service Credits

(a) Entitlement. If the Service Provider fails to achieve the Uptime Target or the Resolution Time compliance targets set out in Section 6 during any Measurement Period, the Customer shall be entitled to a Service Credit calculated in accordance with this Section 7. Service Credits are the Customer's sole and exclusive financial remedy for any failure to meet the service levels set out in this SLA, except in cases of repeated breach giving rise to a right of termination under Section 13.

(b) Uptime Service Credit Schedule. The Service Credit for a failure to meet the Uptime Target shall be calculated as a percentage of the monthly recurring charges payable by the Customer for the Service in the affected Measurement Period (the "Monthly Service Fee"), in accordance with the following tiered schedule:

Monthly Uptime Percentage equal to or greater than [UPTIME_TARGET] — no credit due. Monthly Uptime Percentage less than [UPTIME_TARGET] but at least 99.0% — Service Credit equal to [TIER_1_CREDIT_PERCENTAGE] of the Monthly Service Fee. Monthly Uptime Percentage less than 99.0% but at least 98.0% — Service Credit equal to [TIER_2_CREDIT_PERCENTAGE] of the Monthly Service Fee. Monthly Uptime Percentage less than 98.0% but at least 95.0% — Service Credit equal to [TIER_3_CREDIT_PERCENTAGE] of the Monthly Service Fee. Monthly Uptime Percentage less than 95.0% — Service Credit equal to [TIER_4_CREDIT_PERCENTAGE] of the Monthly Service Fee.

(c) Resolution Time Service Credit. For each Measurement Period in which the Service Provider fails to meet the Resolution Time compliance target set out in Section 6(e) for a given Severity Level, the Customer shall be entitled to an additional Service Credit equal to [RESOLUTION_CREDIT_PERCENTAGE] of the Monthly Service Fee per Severity Level affected.

(d) Cap. The aggregate Service Credits payable in respect of any single Measurement Period shall not exceed [SERVICE_CREDIT_CAP] of the Monthly Service Fee for that Measurement Period.

(e) Claim Process. The Customer must request any Service Credit in writing, citing the relevant Incident references, within thirty (30) days after the end of the Measurement Period in which the failure occurred. The Service Provider shall validate the claim within fifteen (15) days of receipt and, if accepted, apply the Service Credit against the next invoice for the Service.

8. Measurement and Reporting

(a) Monitoring. The Service Provider shall continuously monitor the Service using its own monitoring tools, and where reasonably practicable shall provide the Customer with read-only access to a real-time status dashboard at [STATUS_DASHBOARD_URL].

(b) Monthly Report. Within ten (10) Business Days after the end of each Measurement Period, the Service Provider shall deliver to the Customer a written Service Level Report (the "Monthly Report") containing, at a minimum: (i) Monthly Uptime Percentage; (ii) total Downtime, with start time, end time, duration and root cause for each Downtime event; (iii) count of Incidents per Severity Level; (iv) Response Time and Resolution Time achieved per Incident; (v) any Service Credits owed; and (vi) a commentary on trends, root causes, and corrective actions taken or planned.

(c) Source of Truth. The Service Provider's monitoring records shall be the primary source of measurement, provided that the Customer may dispute any record by submitting reasonable evidence (logs, screenshots, third-party monitoring data) within thirty (30) days of receipt of the Monthly Report.

9. Exclusions

The following events and circumstances shall be excluded from the calculation of Downtime, Response Time, and Resolution Time, and shall not give rise to a Service Credit:

(a) Planned Maintenance carried out within an approved maintenance window, provided that the Service Provider has given the Customer at least [PLANNED_MAINTENANCE_NOTICE_DAYS] days' prior written notice and that the maintenance is performed outside Business Hours unless otherwise agreed in writing.

(b) Emergency Maintenance reasonably required to address a security vulnerability, regulatory requirement, or imminent risk to the Service or its users, provided that the Service Provider gives the Customer as much advance notice as is reasonably practicable.

(c) Force Majeure Events beyond the reasonable control of the Service Provider, including but not limited to acts of God, natural disasters, war, terrorism, civil unrest, government order, public-health emergency, labour disputes not involving the Service Provider's own workforce, and failures of public telecommunications networks or the public internet outside the Service Provider's network.

(d) Customer-Caused Outages, including any outage or degradation caused by (i) acts or omissions of the Customer or its Authorized Users, (ii) software, hardware, network infrastructure, or third-party services provided or controlled by the Customer, (iii) the Customer's failure to apply patches, updates, or configuration changes communicated by the Service Provider, or (iv) any unauthorized access caused by compromise of the Customer's credentials.

(e) Third-Party Outages outside the Service Provider's reasonable control, including outages of upstream internet service providers, public cloud-platform incidents affecting the underlying infrastructure (where the underlying platform is procured by the Customer directly), and third-party software-as-a-service components not provided by the Service Provider.

(f) Beta, Preview, Early Access, or Experimental Features explicitly labelled as such by the Service Provider.

(g) Suspension of the Service by the Service Provider in accordance with the Master Agreement, including for non-payment or breach.

10. Escalation Procedure

If the Customer is dissatisfied with the handling of any Incident, or if a Resolution Time target is at risk of being missed, either Party may escalate the matter through the following levels, with each escalation triggered automatically if no satisfactory resolution is reached within the time indicated:

Level 1 (initial assignment): Service Provider's service desk engineer. Trigger: Incident submitted. Level 2 (within [LEVEL_2_TRIGGER_HOURS]): Service Provider's Shift Lead or Duty Manager. Level 3 (within [LEVEL_3_TRIGGER_HOURS]): Service Provider's Service Delivery Manager and Customer's Account Manager. Level 4 (within [LEVEL_4_TRIGGER_HOURS]): Senior management of both Parties (Head of Operations or equivalent). Level 5 (within [LEVEL_5_TRIGGER_HOURS]): Executive sponsors of both Parties (C-level or equivalent).

The Parties' named contacts at each level shall be set out and kept current in Schedule B (Contact and Escalation Matrix). Either Party may update its contacts at any time by written notice.

11. Continuous Improvement and Service Reviews

The Parties shall meet at the following cadences to review service performance and continuous-improvement initiatives: (a) monthly operational review attended by service-delivery and operations representatives, focused on the Monthly Report; (b) quarterly business review attended by senior management, focused on trends, strategic alignment, and the continuous-improvement roadmap; and (c) annual strategic review attended by executive sponsors, focused on the renewal, scope, and overall partnership. The Service Provider shall maintain a continuous-improvement plan that identifies root causes of recurring Incidents and proposes preventive measures.

12. Change Management

Any material change to the Service, the service levels, the Severity Classification matrix, the Response or Resolution Time targets, the Service Credit schedule, or the Exclusions shall only take effect upon written agreement signed by both Parties in the form of an amendment to this SLA. Non-material operational changes (for example, updates to the contact list in Schedule B) may be made by written notice from either Party without formal amendment. The Service Provider shall give the Customer at least [CHANGE_NOTICE_DAYS] days' written notice of any change to its standard operating procedures that materially affects the Customer's use of the Service.

13. Termination for Repeated SLA Breach

Without prejudice to any other right of termination in the Master Agreement, the Customer may terminate this SLA and the Master Agreement (in whole or in part as it relates to the Service) for cause, with immediate effect upon written notice to the Service Provider, if any of the following occurs:

(a) the Monthly Uptime Percentage falls below the Uptime Target for three (3) consecutive Measurement Periods;

(b) the Monthly Uptime Percentage falls below the Uptime Target for any four (4) Measurement Periods within any rolling twelve (12) month period;

(c) the Service experiences a P1 Incident lasting more than [P1_TERMINATION_THRESHOLD] continuous hours; or

(d) the Service Provider fails to deliver the Monthly Report for two (2) consecutive Measurement Periods despite written notice and a fifteen (15) day cure period.

In the event of termination under this Section 13, the Customer's payment of Service Credits accrued up to the termination date shall be without prejudice to any other rights or remedies the Customer may have, including the right to recover wasted expenditure and reasonable transition costs as set out in the Master Agreement.

14. Review and Amendment of this SLA

The Parties shall jointly review this SLA at least once every twelve (12) months from the Effective Date, or earlier upon written request by either Party. Any amendment to this SLA must be in writing and signed by an authorized representative of each Party. The Parties acknowledge that service levels and Service Credit schedules may need to be adjusted to reflect changes in technology, regulatory requirements, the criticality of the Service to the Customer's business, or the commercial relationship between the Parties.

15. Legal Disclaimer

This template is provided by ProcureSwift as a starting point and does not constitute legal advice. Please have it reviewed by qualified legal counsel before use in any contractual or commercial setting. ProcureSwift makes no warranties about its fitness for any specific purpose.