Software License Term Sheet Template for United States

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Key Requirements PROMPT example:

Software License Term Sheet

"I need a Software License Term Sheet for licensing our enterprise-level data analytics software to financial institutions in the US market, with specific provisions for data security compliance and source code protection."

Document background
The Software License Term Sheet is commonly used in the United States as a preliminary step in software licensing negotiations. It provides a structured framework for parties to agree on fundamental terms before investing in detailed legal documentation. This document typically includes license scope, fees, term, termination rights, and key obligations, serving as a roadmap for the final agreement. It's particularly useful in complex software licensing deals where parties need to align on commercial terms before proceeding with comprehensive legal documentation.
Suggested Sections

1. Parties: Identification of licensor and licensee, including full legal names and addresses

2. Background: Context of the software licensing arrangement and brief description of the software product

3. Definitions: Key terms used throughout the term sheet including Software, Documentation, Intellectual Property Rights, License Fees

4. License Grant: Scope and nature of the software license, including usage rights, restrictions, and territory

5. License Fees: Payment terms, fee structure, and payment schedule

6. Term and Termination: Duration of the license, renewal terms, and conditions for termination

7. Intellectual Property Rights: Ownership of IP rights, protection measures, and infringement handling

8. Warranties and Limitations: Software warranties, disclaimer of warranties, and limitation of liability

Optional Sections

1. Source Code Escrow: Terms for source code protection and release conditions, relevant for mission-critical software

2. Professional Services: Terms for implementation, customization, or maintenance services if required

3. Data Processing Terms: Terms for handling personal data, compliance with privacy laws, and data protection measures

4. Export Control: Compliance requirements with US export control laws and regulations

5. Disaster Recovery: Requirements for backup, recovery, and business continuity measures

Suggested Schedules

1. Schedule A - Software Description: Detailed description of licensed software, features, and functionality

2. Schedule B - Service Level Agreement: Performance metrics, service levels, and support requirements

3. Schedule C - Fee Schedule: Detailed breakdown of licensing fees, payment terms, and pricing structure

4. Schedule D - Technical Requirements: Hardware, system, and infrastructure requirements for software operation

5. Schedule E - Maintenance and Support: Terms and conditions for ongoing maintenance and technical support services

Authors

Alex Denne

Head of Growth (Open Source Law) @ Genie AI | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Industries

Copyright Act of 1976: Federal law (17 U.S.C.) governing software protection and copyright matters for software licensing agreements

Digital Millennium Copyright Act (DMCA): Federal law addressing digital copyright issues and protecting against unauthorized access to copyrighted works

Computer Fraud and Abuse Act (CFAA): Federal law dealing with computer security and unauthorized access, relevant for software usage terms

Federal Trade Commission Act: Federal consumer protection law governing unfair or deceptive trade practices in software licensing

Uniform Commercial Code (UCC): Particularly Article 2B, governing commercial transactions including software licensing agreements

California Consumer Privacy Act (CCPA): State law governing privacy rights and consumer data protection in California, applicable to software handling personal data

Export Administration Regulations (EAR): Federal regulations controlling the export and import of commercial software and technology

International Traffic in Arms Regulations (ITAR): Federal regulations controlling defense-related software and technology exports

HIPAA: Healthcare privacy law applicable to software handling medical information

GLBA: Financial services privacy law applicable to software handling financial information

FERPA: Education privacy law applicable to software handling student information

Sherman Antitrust Act: Federal law prohibiting monopolistic practices and anti-competitive behavior in software licensing

State Contract Laws: Various state-specific requirements for contract formation, consumer protection, and warranties

Patent Laws: Federal laws protecting novel, non-obvious technological innovations in software

Trade Secret Laws: State and federal laws protecting proprietary software information and intellectual property

Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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