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A software license agreement offer a contractual remedy against
the user for failing to comply with any provision in the agreement.
This is in addition to any other legal remedies that may
be available, such as those under copyright law. Also, the
agreement can determine the venue for any litigation which
can save future costs if disputes arise. For beta software
or evaluation software, the agreement should include slightly
different terms most are similar to the below.
You can find Sample Software License Agreements, software licenses definitions, one year license software, software license, collaborate and software license, Software Licnese Agreement Examples, Software license payment terms from many sources on the web, but you are taking risk in terms of quality.
Beta Agreement
and other Software License Agreement legal forms are available
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Software License Agreement Terms
Permitted Uses of the Software
A license agreement should state how the software may or
may not be used:
- That the user may install the software on one machine
or many, may make only one copy or many
- That the use is exclusive or non-exclusive (whether more
than one party is granted a license)
- That the software and license agreement are transferable
or assignable, or not
- That the software may only be used in certain countries
- That the user may not modify, reverse engineer,lease, rent or
export the software
Acceptance and Installation of the Software
Depending on whether the software is customized or off-the-shelf,
the agreement may have a provision stating what steps are
necessary for acceptance and installation. As acceptance can
be a tricky legal concept, agreeing to the procedures for
testing and acceptance up front can often be very helpful.
Getting the user's agreement to when acceptance is complete protects you from later claims that the purchaser's did not accept the software and therefore legally does not owe you payment.
Maintenance of the Software
Some licensors of software have maintenance programs available
for annual purchase which provide bug fixes, updates and technical
support paid at the beginning of each year. While the prices
vary, typical annual fees are fifteen to twenty percent of
the cost of the software license.
If maintenance is purchased, it can be helpful to describe
in the agreement exactly what is provided. Detailed descriptions
of maintenance include what types of software problems are given what
priority of resolution, how long resolutions of problems may
take, remedies if a problem cannot be fixed, user responsibilities
in the process, who may contact the licensor's technical support
team, and other items. Obtaining the customer's agreement to your maintenance program means you are better protected from customer demands for additional services without making additional payments.
Customization of the Software
Projects for development or customization of software are
very legally complex and you should always retain an attorney
with knowledge of software development agreements for such
a project. If any customizations, interfaces or integration
of the software are to occur, they should be carefully set
forth in an exhibit to the agreement, including description
of the final software functionality, deadlines, testing, acceptance
and installation. Spelling out these details and obtaining the customer's agreement helps thwarts arguments later about whether the completed protect is what was protected, whether the customer agreed to it and whether you should be paid.
Ownership of the Software
The agreement should state that the user agrees that the
licensing entity owns the software, customizations and updates.
This serves both to give notice of the ownership to the user
and also gain the user's legal agreement up front to this
fact
Payment
The agreement should set forth procedures, timelines and
amounts for the software license and maintenance fees to avoid
confusion and ensure prompt payment and performance of services. Payment after each module of work and the customer's acceptance ensures that you do not put in too much work prior to getting paid.
Warranties
Most software includes an express warranty of at least thirty days.
Good warranty provisions includes specific conditions and
exceptions to the warranty which protect the licensor.
It is vital for the licensor that the agreement include the
correct language as required by law, in the correct point
font size (no, I'm not joking) to waive other legal warranties
which are implied under the Uniform Commercial Code to the
sale of products, which includes software. Despite its name,
the uniform commercial code varies by state, but generally
is uniform nonetheless. The UCC implied warranties include
a warranty that the item will do what it is intended to do,
that it may be fit for a particular promise if so stated,
that it does not infringe third party rights and that the
seller has proper title to sell the item.
Termination
Under what circumstances, either the user or the licensor
can terminate the software license and/or maintenance, and
procedures and results of doing so should be included so that
both parties have notice and agreement of their rights.
Liability Limit
The license agreement should also limit the liability of
the licensor for damages of all kinds regarding use of the
software, errors or viruses in the software and other items.
This wording should be drafted by an attorney to be effective. Properly
drafted, this is an extremely beneficial provision to lower
risk in your software business.
Indemnification
In software licensing involving large sums of money, the
licensor will typically be asked to provide an indemnification
of the user for the software's infringement of any third party
rights. This means that if the user is sued because the software
included materials which infringed the rights of another party,
the licensor must reimburse the user for all costs and expenses
of this litigation.
Software License Agreement Conclusion
A software license agreement can offer tremendous legal benefit
both in lower risk and ensuring protection of your software
and legal rights.
You can find Sample Software License Agreements, software licenses definitions, one year license software, software license, collaborate and software license, Software Licnese Agreement Examples, Software license payment terms from many sources on the web, but you are taking risk in terms of quality.
Short form and long form, including maintenance
and customization, software license agreement legal forms
by the author are available for purchase here.
1 Readers are cautioned not to rely
on this article as legal advice as it is
no substitution for a consultation with an attorney in your
state. Based
on jurisdiction and time, the law varies and changes.
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