Software Licence Agreement (England & Wales)
Parties
This agreement is dated the date on which it is signed by the last of the parties.
This agreement is made between [Licensor] (the "Licensor") and [Licensee] (the "Licensee").
Key Terms
"Software" means [Software].
"Documentation" means [Documentation].
"Purpose" means [Purpose].
"Licence Scope" means non-exclusive, non-transferable, non-sublicensable (except to permitted contractors), and revocable only as this agreement permits.
"Territory" means [Territory].
"Permitted Users" means [Permitted Users].
"User Limit" means [User Limit].
"Licence Term" means [Licence Term].
"Delivery Method" means [Delivery Method].
"Acceptance Period" means 10 Business Days after delivery.
"Fees" means [Fees].
"Payment Terms" means 30 days after receipt of a valid invoice.
"Late Payment Interest" means 4% per year above the Bank of England base rate.
"Support Services" means [Support Services].
"Support Hours" means 09:00 to 17:00 on Business Days, excluding English public holidays.
"Maintenance Services" means [Maintenance Services].
"Implementation Services" means [Implementation Services].
"Liability Cap" means [Liability Cap].
"Licensor Notice Address" means [Licensor Notice Address].
"Licensee Notice Address" means [Licensee Notice Address].
"Governing Law" means the law of England and Wales.
"Courts" means the courts of England and Wales.
"Business Day" means a day other than a Saturday, Sunday or public holiday in England when banks in London are open for business.
"Target Uptime" means [Target Uptime].
"Target Response Time" means [Target Response Time].
"Support Channel" means [Support Channel].
"Uptime Credit" means [Uptime Credit].
"Response Time Credit" means [Response Time Credit].
Licence Grant
Subject to the Licensee paying the Fees and complying with this agreement, the Licensor grants the Licensee a licence with the Licence Scope to use the Software and Documentation during the Licence Term, in the Territory, solely for the Purpose, by the Permitted Users and up to the User Limit.
The Licensee is responsible for the acts and omissions of its Permitted Users and for ensuring that they use the Software and Documentation in accordance with this agreement.
User Accounts and Credentials
The Licensee is responsible for all actions on its Permitted Users' accounts and for their compliance with this agreement. The Licensee and its Permitted Users must protect the confidentiality of their passwords and login credentials and must promptly notify the Licensor if they suspect or know of fraudulent activity involving them or that they have been compromised.
Use Restrictions
The Licensee must not, and must not allow any other person to, copy the Software except for reasonable backup and operational copies; modify, adapt or create derivative works from it except as permitted by law; reverse engineer, decompile or disassemble it except to the extent that applicable law cannot lawfully be excluded; rent, lease, sell, distribute, sublicense, make available or otherwise transfer it; remove proprietary notices; use it to provide services to third parties; or use it in breach of law or the Documentation.
Export Controls and Sanctions
The Licensee must not export, re-export, transfer or allow use of the Software or any related technology or materials in breach of applicable export-control or sanctions laws or regulations. The Licensee represents and warrants that it is not a sanctioned person or entity and is not owned or controlled by a sanctioned person or entity. The Licensor may terminate this agreement immediately without notice or liability where reasonably necessary to comply with applicable export-control or sanctions laws and regulations.
Delivery and Acceptance
The Licensor must deliver the Software and Documentation using the Delivery Method. Risk in any physical media passes on delivery, but this does not affect the Licensor's obligations under the Warranties clause.
The Licensee may test the Software during the Acceptance Period against the Documentation. If it identifies a material failure to conform, it must give reasonably detailed written notice before that period ends, and the Licensor must promptly correct the failure. The Software is accepted when the Licensee confirms acceptance, uses it in production other than for testing, or does not give a valid rejection notice within the Acceptance Period.
Fees and Payment
The Licensee must pay the Fees in accordance with the Payment Terms. Fees are exclusive of VAT and other applicable taxes, which the Licensee must pay on receipt of a valid VAT invoice.
If an undisputed sum is overdue, the Licensor may charge Late Payment Interest from its due date until payment and recover reasonable debt-recovery costs. The Licensee may withhold a genuinely disputed sum if it promptly explains the dispute and pays all undisputed sums.
Service Credits
If there is a Target Uptime and Software availability falls below the Target Uptime, the Licensee is eligible to receive an Uptime Credit. If there is a Target Response Time and neither the Licensor nor the Licensor's support representative acknowledge a support request submitted to the Support Channel within the Target Response Time, the Licensee is eligible to receive a Response Time Credit. Service Credits only apply towards future Fees owed by the Licensee to the Licensor.
Service Credits may not be exchanged for, or converted to, monetary amounts. Service Credits do not earn interest. Service Credits will not accumulate within a single Licence Term in an amount more than 8% of Fees for that Licence Term. Service Credits expire when the applicable Licence Term ends.
To receive a Service Credit, the Licensee must notify the Licensor within 7 days of the end of the month in which the Licensee believes the Service Credit was earned, otherwise Service Credit eligibility will expire for that month.
Fees and Payment
The Licensor may suspend the licence or Support Services on at least 10 Business Days' written notice if an undisputed sum remains unpaid after its due date, provided it restores access promptly after payment. It must not suspend where the Licensee is pursuing a genuine dispute in good faith.
Support and Maintenance
The Licensor must provide the Support Services during the Support Hours with reasonable skill and care. The Licensee must provide reasonable information, access and cooperation needed for support.
Service Levels
The parties agree to calculate availability of the Software as the total number of Available Minutes minus the number of Downtime Minutes, divided by the total number of Available Minutes, measured in a calendar month. If the Licence Term includes a partial month, the numerator and denominator will only include the days that are part of the Licence Term for that month.
If there is a Target Uptime, the Licensor will use commercially reasonable efforts to make the Software available for at least the Target Uptime as calculated each calendar month.
Support and Maintenance
The Licensor must provide the Maintenance Services with reasonable skill and care. It may install updates that are reasonably necessary to maintain, secure or improve the Software, provided that they do not materially reduce the Software's agreed functionality.
Updates
During the Licence Term, the Licensor must provide, at no additional charge, updates and maintenance releases to the Software that it makes generally available to its customers who have purchased the same Software and services as the Licensee, including updated Documentation where applicable. The Licensee must install all updates as soon as reasonably practicable after receipt.
Implementation
The Licensor must perform the Implementation Services with reasonable skill and care. Each party must provide the information, decisions, personnel and cooperation reasonably needed for those services; any dates depend on timely cooperation by both parties.
Intellectual Property
The Licensor and its licensors retain all intellectual property rights in the Software, Documentation, Maintenance Services and all related materials. The Licensee retains all rights in its data and materials. Except for the express licence in this agreement, neither party grants the other any rights.
The Licensee may give feedback about the Software. The Licensor may use that feedback without restriction or charge, provided it does not identify the Licensee as the source without consent.
Usage Data
The Licensor may collect and analyse data and information about the provision, use and performance of the Software and related offerings based on the Licensee's or Permitted Users' use of the Software (Usage Data). The Licensor may use Usage Data to maintain, improve, enhance and promote its products and services without restriction or obligation, but may disclose Usage Data to others only if it is aggregated and does not identify the Licensee or Permitted Users.
Intellectual Property
The Licensor must defend the Licensee against a third-party claim that authorised use of the Software or Documentation infringes that third party's UK intellectual property rights, and pay damages and costs finally awarded or agreed in settlement, if the Licensee promptly notifies the Licensor, gives it sole control of the defence and settlement, and provides reasonable assistance. This does not apply to claims caused by the Licensee's modification, combination with items not supplied by the Licensor, use outside this agreement or continued use after notice of infringement. For an actual or likely claim, the Licensor may procure continued use, modify or replace the affected item, or terminate the affected licence and refund prepaid Fees for the unused part of the Licence Term. This clause states the Licensee's sole remedy for such claims.
Confidentiality
Each party must keep the other party's Confidential Information confidential and use it only to perform or receive the benefit of this agreement. Confidential Information means information disclosed in connection with this agreement that is confidential by nature or identified as confidential, including the Software, Documentation, Fees and business information. It does not include information that the receiving party can show is public other than through breach, already lawfully known, independently developed, or lawfully obtained without a duty of confidence. A party may disclose Confidential Information to its personnel, professional advisers and subcontractors who need to know it and are bound by confidentiality obligations, or where law, a regulator or court requires disclosure.
Data Protection
Each party must comply with applicable data protection law. Where the Licensor processes personal data for the Licensee as processor, the parties must enter into and comply with a data-processing schedule meeting Article 28 of the UK GDPR before that processing begins.
The Licensor must maintain appropriate technical and organisational measures to protect Licensee data in its possession or control against accidental or unlawful destruction, loss, alteration, unauthorised disclosure or access, having regard to the nature of the data and the risks involved.
Compliance Audit
On at least 10 Business Days' written notice and no more than once in any 12-month period, the Licensor may audit records reasonably necessary to verify compliance with the User Limit and Use Restrictions. Any audit must occur during normal business hours, minimise disruption and comply with the Licensee's reasonable security requirements. If it reveals material under-licensing, the Licensee must promptly pay the applicable Fees for the excess use and reasonable audit costs.
Warranties
The Licensor warrants that, for the Licence Term, the Software will materially conform to the Documentation when used in accordance with this agreement. If the Software does not conform, the Licensor must use reasonable endeavours to repair or replace it. This warranty does not apply to failures caused by misuse, unauthorised modification, unsupported third-party items or use contrary to the Documentation.
Mutual Authority and Compliance Warranties
Each party represents and warrants to the other that it has the legal power and authority to enter into this agreement and will comply with applicable law in performing its obligations and exercising its rights under this agreement.
Warranties
Except as expressly stated in this agreement, and to the fullest extent permitted by law, all warranties, conditions and other terms implied by statute, common law or otherwise are excluded. The Licensor does not warrant that the Software will be uninterrupted or error-free, or meet requirements not stated in this agreement.
Liability
Neither party is liable to the other for loss of profit, loss of revenue, loss of business, loss of goodwill, loss of anticipated savings, or indirect or consequential loss, in each case whether arising in contract, tort (including negligence), misrepresentation, restitution or otherwise.
Subject to the next sentence, each party's total liability arising out of or in connection with this agreement is limited to the Liability Cap. Nothing in this agreement limits or excludes liability for death or personal injury caused by negligence, fraud or fraudulent misrepresentation, or any liability that cannot lawfully be limited or excluded.
Service Credits
Except for any right to terminate and receive a refund for repeated failure to meet the Target Uptime, the Service Levels and Service Credits clauses describe the Licensee's exclusive remedy and the Licensor's entire liability for any failure of the Software to meet the Target Uptime and for any inability to meet the Target Response Time.
Term and Termination
This agreement starts on the agreement date and continues for the Licence Term unless ended earlier under this clause. Either party may terminate immediately by written notice if the other party commits a material breach and, where the breach can be remedied, does not remedy it within 30 days after receiving written notice requiring it to do so; or becomes insolvent, enters administration or liquidation, or ceases or threatens to cease carrying on business.
On expiry or termination, the licence ends and the Licensee must stop using the Software and Documentation and, on request, return or securely delete them and all copies, except for archival copies required by law. Termination does not affect accrued rights or clauses intended to continue, including Intellectual Property, Confidentiality, Liability, Term and Termination, and General.
General
Neither party is liable for delay or failure to perform caused by an event beyond its reasonable control, excluding payment obligations. The affected party must notify the other and use reasonable endeavours to reduce the effect of the event. If it continues for more than 60 days, either party may terminate the affected part on written notice.
Neither party may assign, transfer or deal with its rights or obligations under this agreement without the other party's prior written consent, not to be unreasonably withheld or delayed, except that either party may assign this agreement to a group company or in connection with a genuine transfer of all or substantially all of its business or assets to which this agreement relates, on written notice.
The Licensor may subcontract its obligations, but remains responsible for its subcontractors' performance.
Independent Contractors
The parties are independent contractors, not agents, partners or joint venturers. Neither party is authorised to bind the other to any liability or obligation.
General
A notice under this agreement must be in writing and delivered by hand, prepaid first-class post or email to the Licensor Notice Address or the Licensee Notice Address, as applicable, or to replacement contact details notified in writing. A notice is deemed received on delivery if delivered by hand, two Business Days after posting, or when sent by email if no delivery-failure message is received before 17:00 on a Business Day, otherwise at 09:00 on the next Business Day. This does not apply to service of legal proceedings.
This agreement is the entire agreement between the parties about its subject matter and replaces earlier discussions and arrangements. Each party acknowledges that it has not relied on any statement not set out in this agreement, but this does not limit liability for fraud or fraudulent misrepresentation.
Changes, Severability and Waiver
Any waiver, modification or change to this agreement must be in writing and signed or electronically accepted by each party. If any term of this agreement is determined by a court of competent jurisdiction to be invalid or unenforceable, the remaining terms remain in full force and effect. A party's failure to enforce a term or exercise an option or right does not waive that term, option or right.
General
A person who is not a party to this agreement has no right under the Contracts (Rights of Third Parties) Act 1999 to enforce any term of it.
Governing Law and Jurisdiction
This agreement and any non-contractual obligations arising out of or in connection with it are governed by the Governing Law.
The Courts have exclusive jurisdiction to settle any dispute arising out of or in connection with this agreement, including any non-contractual dispute.
Injunctive Relief
Despite the Governing Law and Jurisdiction clause, a breach of the Confidentiality clause or violation of a party's intellectual property rights may cause irreparable harm for which monetary damages cannot adequately compensate. On an actual or threatened breach or violation, the non-breaching or non-violating party may seek appropriate equitable relief, including an injunction, in any court of competent jurisdiction, without limiting its other rights or remedies.
Open-source Components
The Licensor must identify applicable open-source components and provide the notices, licence information, source code or offer of source code required by their licences. The relevant open-source licence governs that component to the extent it requires different rights or conflicts with restrictions in this agreement. This clause does not expand the licence to proprietary components.
Perpetual Licence and Support
Where the licence fee is a one-time fee for a fully paid perpetual licence, the licence continues after this agreement expires and ends only if it is terminated under an express right to terminate in this agreement, despite any provision requiring use of the software to stop on expiry. Expiry or non-renewal of support or maintenance alone does not end that perpetual licence. The licence remains subject to its agreed use restrictions and any express termination right for material breach. Support fees and future updates end or continue only as stated in the support terms. This clause prevails over a general requirement to cease all software use solely because support or this agreement expires.