Source Code Escrow Agreement Template for United States

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Key Requirements PROMPT example:

Source Code Escrow Agreement

"Need a Source Code Escrow Agreement for our new fintech software being licensed to three major banks, with specific release conditions for regulatory compliance and quarterly verification requirements, to be effective from March 2025."

Document background
The Source Code Escrow Agreement is essential in software licensing relationships where the licensee relies critically on the software's continued maintenance and support. This agreement, commonly used in the United States, provides a safety net for licensees while protecting the software owner's intellectual property. It specifies detailed procedures for deposit, verification, and release of source code, typically triggered by specific events such as vendor bankruptcy or breach of support obligations. The agreement includes provisions for regular updates, confidentiality protections, and verification procedures to ensure the deposited materials are complete and usable.
Suggested Sections

1. Parties: Identifies the software owner (depositor), beneficiary (licensee), and escrow agent

2. Background: Explains the context of the agreement and the relationship between parties

3. Definitions: Defines key terms including Deposit Materials, Release Events, and Verification

4. Deposit Obligations: Details what materials must be deposited and maintenance requirements

5. Release Conditions: Specifies circumstances under which the source code will be released

6. Verification Procedures: Outlines processes for verifying completeness and accuracy of deposited materials

7. Confidentiality: Establishes confidentiality obligations for all parties

8. Term and Termination: Specifies duration and termination conditions

Optional Sections

1. International Provisions: Additional provisions required when parties are in different jurisdictions

2. Export Control: Provisions addressing export control compliance requirements

3. Source Code Updates: Procedures and requirements for updating deposited materials

4. License Rights: Specific terms governing license rights upon release of materials

Suggested Schedules

1. Schedule A - Deposit Materials: Detailed list of all materials to be deposited

2. Schedule B - Verification Procedures: Technical specifications for verification testing

3. Schedule C - Release Request Form: Standard form for requesting release of materials

4. Schedule D - Fee Schedule: Escrow agent's fees and payment terms

5. Schedule E - Contact Information: Authorized contacts for all parties

6. Schedule F - Technical Specifications: Technical requirements for deposit materials

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

Relevant legal definitions
Clauses
Industries

Copyright Act: 17 U.S.C. - Federal law governing copyright protection, essential for protecting the source code as intellectual property

Trade Secrets Protection: Defend Trade Secrets Act of 2016 - Federal law protecting confidential business information and trade secrets, crucial for source code protection

Patent Act: Federal law governing patents, may be relevant if the source code contains patented technologies or processes

State Contract Laws: State-specific laws governing contract formation, enforcement, and interpretation

Uniform Commercial Code: Standardized state laws governing commercial transactions, relevant for software licensing and sales

E-SIGN Act: Electronic Signatures in Global and National Commerce Act - Federal law governing electronic signatures and records

U.S. Bankruptcy Code: Federal bankruptcy laws, particularly Section 365 regarding executory contracts and protection of licensee rights

State Data Protection Laws: State-specific regulations governing data protection and privacy requirements

State Escrow Regulations: State-specific laws governing escrow services, including licensing requirements for escrow agents

Export Control Regulations: Federal regulations controlling the export of technology and source code to foreign countries

Industry Compliance Requirements: Sector-specific regulations that may affect source code handling and storage (e.g., HIPAA for healthcare, GLBA for financial services)

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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