Source Code Escrow Agreement

How To Use

Source Code agreements came into being because very small and unstable software companies were doing mission critical work for large corporations.

To protect the confidentiality of the software company, but protect the interests of the large corporations dependent on the software, the Source Code Escrow Agreement emerged as a solution to the problem.  It has worked very effectively in the B2B software business.

This review list is provided to help you complete the Source Code Escrow Agreement and ensure the necessary steps are taken to make it effective.

  • The Software Source Code Escrow Agreement calls for placing computer software programs and related materials in escrow for the benefit of licensee users of the programs.  In certain situations, a program user is entitled to retrieve the source code and related materials from the escrow agent to ensure the continued operation of the program.  Make sure these terms are appropriate for your situation.
  • Laws vary from state to state and change over time.  Before using this document, have your attorney review it.  Buyers of the software licenses should be aware that the major risk is a party claiming a security interest in the Source Code residing at the Escrow Agent and being able to prevent customers from recovering it.  A protection against this potential claim appears when the end user, or customer/buyer, is responsible for paying for the release of the software.
  • Print multiple copies so the parties can have the a copy of the signed Agreement and so the sales people for the Developer can have blank copies available for inspection and signature in future sales agreements.