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Software development agreement (premium)

This full-length software development agreement is highly flexible. It contains a wealth of optional and alternative provisions, and can be adapted for use in a wide range of software development scenarios, including those involving corporate clients.

The agreement assumes that the new intellectual property rights in code produced by the developers will be assigned (ie transferred) to the customer. However, pre-existing code ("framework code" in the terms of the agreement) may be retained by the developers and licensed to the client. Similarly, the rights in third party materials incorporated into the software may be treated separately from the rights in code produced by the developers.

The agreement makes provision for set-up services, which might include installation, configuration and integration services. In addition, a fairly straightforward acceptance procedure is suggested. Under this procedure, the customer must go through a number of rounds of acceptance tests before a failure of the software to meet its specification amounts to a material breach of contract.

Source code may or may not be supplied with the software. If source code is not supplied, it may be placed in escrow.

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Software development agreement (premium) contents

  1. Definitions: definitions.
  2. Term: commencement of term; end of term.
  3. Development Services: obligation to provide development services; timetable for software development and delivery; delays in development services consequent upon second party delays; software development coding standards; keep second party informed of development services progress; availability of software to second party during development.
  4. Set Up Services: obligation to provide set up services; set up services timetable; delays in set up services consequent upon second party delays; software set up services and intellectual property rights.
  5. Acceptance procedure: obligation to carry our acceptance tests; licence to conduct software acceptance tests; assistance with acceptance tests; notification of results of acceptance tests; software deemed to pass acceptance tests; information upon notice of failure to pass acceptance tests; consequences of software acceptance test failure; number of acceptance testing rounds; consequences of acceptance of software.
  6. Assignment: assignment of IPR on acceptance with full title guarantee option; assignment of owned IPR in software on acceptance; assignment for full term of rights; assignment includes right to claim for past infringements.
  7. Framework Software: grant of licence to use framework software; right to sub-license framework software; no sub-licensing of framework software; use of framework software limited to specified persons; framework software licence prohibitions; security of licensed framework software.
  8. Source Code of Framework Software: no licence of source code of framework software (excluding escrow).
  9. Escrow of Source Code of Framework Software: parties to enter into escrow agreement (framework software); all reasonable endeavours in relation to escrow agreement; form of escrow agreement.
  10. Third Party Materials: licensing of third party materials (software).
  11. Additional Development Services: parties may agree additional development services; matters to be agreed relating to additional development services; standard of additional development services.
  12. Customer
    obligations:
    general second party obligations; access to computer systems.
  13. Customer
    Materials:
    supply of second party materials; licence of second party materials; warranties relating to second party materials.
  14. Representatives: instructions given by first party representatives; instructions given by second party representatives.
  15. Management: management meetings; notice to be given when requesting management meeting; attendance of representatives at management meetings.
  16. Change control: application of section to change requests; request changes at any time; change control notice to be in designated form; actions upon receipt of a change control notice; changes only take effect upon agreement of CCN.
  17. Charges: obligation to pay charges; time-base charges limitations; amounts inclusive or exclusive of VAT; variation of charges.
  18. Expenses: obligation to reimburse expenses; collection of evidence of expenses; supply of evidence of expenses.
  19. Timesheets: obligation to keep timesheets; obligation to supply timesheets.
  20. Payments: issue of invoices; time for payment of charges following invoice; payment methods; interest on late payments; interest on late payments.
  21. Developer
    's confidentiality obligations:
    first party confidentiality undertaking; disclosure of confidential information by first party to certain persons; exceptions to first party's confidentiality obligations; disclosures of second party confidential information mandated by law etc; first party to stop using confidential information upon termination; first party to return or destroy confidential information following termination; first party confidentiality obligations after termination.
  22. Customer
    's confidentiality obligations:
    second party confidentiality undertaking; disclosure of confidential information by second party to certain persons; exceptions to second party's confidentiality obligations; disclosures of first party confidential information mandated by law etc; second party to stop using confidential information upon termination; second party to return or destroy confidential information following termination; second party confidentiality obligations after termination.
  23. Publicity: limited public disclosures; limited public disclosures by first party; limited public disclosures by second party; confidentiality obligations overriding.
  24. Data protection: warranty of second party's right to disclose personal data; personal data processing undertakings by first party; personal data notifications; personal data cooperation; personnel access to personal data; personnel reliability and personal data.
  25. Warranties: first party general warranties; software licence warranties; warranty of legality of software and documentation; software and documentation IPR infringement warranty; breach of software infringement warranty; second party warranty of authority; exclusion of implied warranties and representations.
  26. Acknowledgements and warranty limitations: software not error free; software not entirely secure; software compatibility is limited; no legal etc advice with software.
  27. Indemnities: indemnity upon breach: any provision or specified provisions (with definition); conditions upon first party indemnity; indemnity upon breach: any provision or specified provisions (with definition); conditions upon second party indemnity; limitations of liability vs indemnities.
  28. Limitations and exclusions of liability: caveats to limits of liability; interpretation of limits of liability; no liability for force majeure; no liability for loss of profits; no liability for loss of revenue; no liability for loss of use; no liability for loss of opportunities; no liability for loss of data; no liability for consequential loss; per event liability cap upon services contract; aggregate liability cap upon services contract.
  29. Force Majeure Event: obligations suspended for force majeure; force majeure notification and information; mitigation of effects of force majeure.
  30. Termination: termination without cause by first party; termination without cause by second party; termination upon breach; termination upon insolvency; termination upon non-payment.
  31. Effects of termination: surviving provisions upon termination; termination does not affect accrued rights; charges on termination of contract.
  32. Non-solicitation of personnel: non-solicitation of employees by second party; non-solicitation of employees by first party.
  33. Notices: contractual notices must be in writing; methods of sending contractual notices to first party; methods of sending contractual notices to second party; contact details for contractual notices; substitute contact details for notices; acknowledgement of notice by email; deemed receipt of contractual notices.
  34. Further assurance: further assurance (intellectual property); assistance with registration of intellectual property rights; assistance with proceedings relating to assigned intellectual property.
  35. Subcontracting: no subcontracting without consent; subcontracting permitted; first party responsible for subcontracted obligations.
  36. Assignment: assignment by first party; assignment by second party.
  37. No waivers: no unwritten waivers of breach; no continuing waiver.
  38. Severability: severability of whole; severability of parts.
  39. Third party rights: third party rights: benefit; third party rights: exercise of rights.
  40. Variation: variation in writing and signed, subject to change control.
  41. Entire agreement: entire agreement: documents; no mispresentation; section subject to caveats to limits of liablity.
  42. Export control: application of export laws; compliance with export laws; specific export control compliance obligations.
  43. Law and jurisdiction: governing law; jurisdiction.
  44. Interpretation: statutory references; section headings not affecting interpretation; calendar month meaning; no ejusdem generis.

SCHEDULE 1 (SOFTWARE DEVELOPMENT PARTICULARS)

  1. Specification of Software: specification of software prompt.
  2. Third Party Materials: prompt for identification of third party materials.
  3. Set Up Services: specification of software set up services prompt.
  4. Timetable: timetable prompt.
  5. Customer
    Materials
    :
    second party materials prompt.
  6. Financial provisions: financial provisions prompt.
  7. Representatives: first party representatives; second party representatives.

SCHEDULE 2 (FORM OF CCN)

  1. Introduction: title of change; change control notice number; change proposor; date of change control notice; summary of proposed change.
  2. Change details: insert details of change.
  3. Impact of Change: impact upon resources; impact upon timetable; impact upon charges; other effects of proposed change.
  4. Agreement to Change: acceptance of change by signature; form of signature block for first party; form of signature block for second party.

SCHEDULE 3 (FORM OF ESCROW AGREEMENT)

    Add escrow agreement prompt.
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