Master services agreement (MSA)
The framework contract between a neocloud and its customer, under which capacity orders or statements of work are placed. In GPU loans it is the core collateral.
How it works
A master services agreement (MSA) is the framework contract between a cloud provider and its customer. It sets general terms such as service levels, liability, payment and termination, while individual orders or statements of work specify the capacity, price and term for each deployment.
In GPU and data centre deals
In GPU financings the MSA and its orders are the core collateral. Lenders review whether the customer's payment obligation is firm, what termination rights exist, how service credits work and whether the contract can be assigned or charged to them. Facilities are often sized on the contracted cash flows under specific orders, so the order terms matter as much as the MSA.
What gets negotiated
- Customer termination rights, including for convenience or service failure
- Limits on service credits and liability
- Consent to assignment or security in favour of lenders
- Prepayment or termination fees payable by the customer
How it works in a deal
Lenders read the MSA together with each order form, because the MSA holds the termination, assignment, set-off and limitation of liability terms that decide whether the customer's payments can be relied on. A GPU loan will usually need the MSA to allow assignment of receivables to the lender and a direct agreement or acknowledgement from the customer.
Example. CoreWeave's DDTL 5.5 is secured on customer contracts that average about three years, shorter than the loan, so the lenders rely on the borrower being able to re-lease capacity under new orders. CoreWeave: DDTL 5.5 →
For in-house counsel
Master services agreement in the filed documents
Where the term turns up in filed contracts and what is market, for the lender’s or the borrower’s side. Previews are open; the full text is free with InfraCompute Weekly.
- What’s market: Contract value ratio and customer breach triggersDo GPU lenders test the value of the remaining customer contract?
- Contract library: Customer default: fees for the rest of the termIf the provider terminates for the customer's breach, does the customer still owe the remaining fees?
- Contract library: Assignment to lenders and change of controlCan the provider charge the contract to its lenders, and what happens on a sale?
- The legal desk for in-house counselContract library, issues lists, checklists and English law notes.
Related terms
Explanatory definition, not a statement that a particular transaction contains this term or a substitute for its contractual definition.
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