Time and materials is a contract clause where the payment is based on the actual time spent by the contractor and the cost of materials used in the project, rather than a fixed price. This contract type is often utilized when project scope and requirements are not fully defined, allowing for flexibility but requiring careful management to control costs.
Services are provided throughout the United States and its territories to a broad base of clients with no single client representing 10% or more of our revenues for either the year ended December 31, 2019 or 2018. Services are rendered primarily on a time and materials and cost-plus basis with approximately 95% of our contracts on that basis and the remainder represented by firm fixed price contracts.
For our time and materials service contracts, we recognize revenues ratably over the term of the contract since time is the best output measure of how the services are transferred to the customer. Fixed fee contracts are recognized in the period in which the services are performed or delivered as milestones are completed over time.
The arrangement is based on either a time and materials basis or a fixed fee contract. Revenue is recognized on a gross basis in the period in which the services are performed or delivered.
5.2. Time and Materials. Where the Services are provided on a time and materials basis: the fees payable for the Services shall be calculated in accordance with VCG’s daily or hourly fee rates for the VCG Personnel; and VCG shall issue invoices to Service Recipient monthly in arrears for its fees for time for the immediately preceding month, calculated as provided in this Section 5.2, together with a detailed breakdown of any expenses for such month incurred in accordance with Section 5.5.
Time and Materials Contracts Under the time and materials (“T&M”) arrangements, contract fees are based upon time and materials incurred. The contracts may be structured as basic time and materials, cost plus a margin or time and materials subject to a maximum contract value (the "cap value"). Due to the potential limitation of the cap value, the economic factors of the contracts subject to a cap value differ from the economic factors of basic T&M and cost plus contracts. The majority of the Company’s contracts are for consulting projects where it bills the client monthly at hourly billing rates. The hourly billing rates are determined by contract terms. Under cost plus a margin contracts, the Company charges its clients for its costs, plus a fixed fee or rate. Under time and materials contracts with a cap value, the Company charges the clients for time and materials based upon the work performed however there is a cap or a not to exceed value.
The current year performance reflects increased revenue contribution from time and materials programs, which generally yield stronger returns than cost reimbursable contracts, and lower general and administrative ("G&A") expenses, partially offset by higher depreciation and amortization.
(ii) Time and materials fees: The charges for performance of any time and materials due to work orders will be billed monthly for charges incurred in the previous monthly period and are due and payable within thirty (30) days of the date of the invoice. Expenses may include, but are not limited to, reasonable charges for materials, office and travel expenses, graphics, documentation, research materials, computer laboratory and data processing, and out-of-pocket expenses reasonably required for performance. Expenses for travel and travel-related expenses and individual expenses in excess of $500 require Momentum’s prior approval.
Under the terms of the Software License Agreement, NAML agreed to pay MQL a license fee and certain other fixed and time and materials fees.
For purposes hereof, the terms “time and materials” and “milestone billing” shall have those meanings ascribed to them as commonly understood among Seller’s industry, and as ultimately determined in Purchaser’s sole discretion.
If the Receivable is paid within 90 days of purchase by Purchaser, a rebate of 15.00% of the Gross Amount of the Invoice (for time and materials Accounts) and 25% of the Gross Amount of the Invoice (for milestone billings), in each case LESS a Variable Discount Amount ("Variable Discount Amount", defined below) will be remitted to Seller; and,
At Purchaser’s election, if the Receivable is paid more than 90 days after the date of purchase by Purchaser, a rebate of 13.00% of the Gross Amount of the Invoice (for time and materials Accounts) and 23% of the Gross Amount of the Invoice (for milestone billings) of the Gross Amount of the Invoice LESS a Variable Discount Amount will be remitted to Seller.
Fees will be designated as either fixed bid or time and materials based on the applicable Project Proposal and shall be payable by Client pursuant to the Project Proposal and the terms and conditions set forth in this Section 4. In the case of a time and materials project, Client acknowledges that the amounts set forth in the Project Proposal are only estimates, and agrees that Client will be responsible for all Services provided by PLS on a time and materials basis. In the case of a fixed bid project, Client acknowledges that the scope of work to be performed is only that work described in the Project Proposal.
Time and materials (T&M) is a type of contractual arrangement or billing method commonly used in construction, software development, and other industries where the scope of the work is not clearly defined. This contract type involves billing the client based on the actual time spent by the contractor’s employees and the materials used in the project.
The “Time and Materials” approach is most suitable in the following scenarios:
When drafting a “Time and Materials” contract, consider including the following elements:
“Time and Materials” clauses are commonly found in the following types of contracts:
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Dive deeper into the world of clauses and learn more about these other clauses that are used in real contracts.
The "Time is of the essence" clause emphasizes the importance of meeting deadlines specified in a contract, indicating that any delay may constitute a breach of contract. This clause underscores the necessity for all parties to perform their obligations within the agreed timeframes to ensure the contract's objectives are met efficiently.
The "Time of Performance" clause specifies the deadline or schedule by which contracted responsibilities or tasks must be completed. It ensures that all parties involved are aware of the time frame for delivery and performance, thereby minimizing potential delays and disputes.
The "Total Operating Revenues" clause typically refers to the total income generated from a company's primary business activities before any expenses or deductions are applied. It serves as a crucial financial metric, often used to assess a company's financial performance and growth potential.
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