How do you draft an agreement that involves a software development work on Open Source?

I'm drafting an agreement with a client that wanted us to develop a software on top of a Open Source software. Meaning, we will develop new modules on the existing open source software.

How would the IP Rights clause in the agreement sounds like?

It all depends on the Open Source Licenses that comes with the Open Source Software. Usually the Licesnse excludes the inclusion of any proprietary modifications or proprietary additions to the software. If your client requires that his software is proprietary, you're outta luck. No way to get around it, sorry. Read the License carefully... if you try to build a proprietary license on top of it, you may be open for copyright violation litigation and shunned by the open source community as a pirate :-). If the client agrees to let his software go out under the same license, you are in business, but that means the clients software is Open Source too.
If that is the case, all you have to do is include the Open Source license with the software and your in business... no other agreement needed.

Not sure but generally when you are developing Open Source software part of the stipulation specifies that you make the source code available for other users.

I think it depends on which agreement you go with as there are several different ones - you should contant and Intellectual Property Lawyer that is familiar with Open Source software.

There is also the GNU project - google it or check on Wiki