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[Comprehensive -- Long Form]
THIS OUTSOURCING AGREEMENT, dated as of [date] (Agreement), by and among [name], a corporation organized and existing under the laws of the State of [state] with an address of [address] (Licensor), [name], a corporation organised and existing under the laws of the State of [state] with an address of [address] (Licensee), and [name], a corporation organised and existing under the laws of the State of [state] with an address of [address] (User).
W I T N E S S E T H:
WHEREAS, Licensee licenses certain software (Software) from Licensor pursuant to a certain License Agreement, dated as of [date] between Licensor as licensor and Licensee as licensee (License Agreement); and
WHEREAS, Licensee proposes to delegate or "outsource" certain of its data processing operations to User pursuant to a [name of agreement] dated [date] (Outsourcing Agreement); and
WHEREAS, certain of the Software is used or will be used in the operations of Licensee that are proposed to be transferred or "outsourced" to User; and
WHEREAS, Licensor requires the execution and delivery by Licensee and User of this Agreement as a condition to the "outsourcing" of the Software by Licensee to User.
NOW THEREFORE, in consideration of the premises and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Licensee, Licensor, and User hereby agree as follows:
01. Permission to Use the Software. Licensor hereby (a) grants to User, and User hereby accepts, permission to use the Software and all related documentation during the term of this Agreement subject and subordinate in all respects to the License Agreement and the terms and conditions hereof and thereof and (b) consents to the use by User of the Software pursuant to, and the transactions contemplated by, the Outsourcing Agreement. Any rights not expressly granted hereunder shall be reserved for Licensor. Notwithstanding the foregoing, Licensee shall remain liable for the performance of all of its duties and obligations under the License Agreement, and shall not be released or relieved of any thereof by virtue of this Agreement or the Outsourcing Agreement. Licensee hereby indemnifies Licensor, and holds Licensor harmless, from and against any and all claims, damages, liability, cost, and expense of any kind or nature whatsoever arising out of or in connection with the breach by User of any of the terms and conditions of this Agreement. The foregoing indemnity includes all costs and expenses, including reasonable lawyer fees.
02. Proprietary Rights and Restrictions on Use.
a. User recognizes that the Software and all related information, including, but not limited to, any and all updates, improvements, modifications, and enhancements to the Software, whether developed by Licensor, Licensee, or User, are proprietary to Licensor, and that all rights thereto, including, but not limited to, copyright, are owned by Licensor. User further acknowledges being advised that the Software, including updates, improvements, modifications, and enhancements, whether developed by Licensor, Licensee, or User, constitutes a TRADE SECRET of Licensor, is protected by civil and criminal law, and by the law of copyright, is valuable and confidential to Licensor, and that its use and disclosure must be carefully and continuously controlled. User agrees that the specific prices and terms of the License Agreement are also a TRADE SECRET.
b. Licensor shall at all times retain title to all the Software and all related information, including, but not limited to, all updates, improvements, modifications, and enhancements, whether developed by Licensor, Licensee, or User.
c. User shall keep each and every item of Software and all related information, including, but not limited to, any and all updates, improvements, modifications, and enhancements free and clear of any liens, claims, and encumbrances attributable to the use or possession of the Software by User. Any act of User, whether voluntary or involuntary, purporting to create a lien, claim, or encumbrance of any such item shall be null and void.
d. The Software supplied to User hereunder is for the sole use of User, and in support only of operations performed on behalf of Licensee pursuant to the Outsourcing Agreement. The Software is to be used only by User only for the purposes specified in this Agreement and specifically as restricted in this Section 2.
e. User shall treat the Software and all related information including but not limited to any and all updates, improvements, modifications, and enhancements as confidential and proprietary, and shall protect it in the same manner that it protects the confidentiality of its own proprietary information. While this Agreement is in effect, or while User has custody or possession of any of the Software and all related information, User will not (i) copy or duplicate, or permit anyone else to copy or duplicate, any of the Software, whether such Software is in written, magnetic, or any other form, except pursuant to reasonable backup procedures; nor (ii) provide or make available the Software to any person or entity other than employees of User who have a need to know consistent with User's use thereof under this Agreement and the Outsourcing Agreement; nor (iii) create or attempt to create, or permit others to create or attempt to create, by disassembling, reverse engineering, or otherwise, the source programs of any part thereof from the object program or from other information (whether oral, written, tangible, or intangible) made available to User under this Agreement; nor (iv) copy for its own use or the use of other operator manuals, system reference guides, training materials, and other user-oriented materials, without the prior written consent of Licensor. In order to protect Licensee's trade secrets and copyrights in the Software, User agrees to reproduce, imbed, and incorporate Licensor's trade secrets or copyright notice in any copies, updates, modifications, enhancements, or partial copies, both in machine readable form and human readable form. The Software shall be kept in a secure place, under access and use restrictions reasonably satisfactory to Licensor.
f. User agrees to notify Licensee and Licensor in writing forthwith if it obtains information as to any unauthorized possession, use, or disclosure of any item of Software by any person or entity, and further agrees to cooperate with Licensee at Licensee's expense in protecting Licensor's proprietary rights.
g. In addition to other remedies available to Licensee, User agrees that Licensee and Licensor shall be entitled to injunctive relief in the event User breaches this Agreement.
h. User represents and warrants to each of Licensee and Licensor that User is neither (i) a service bureau nor (ii) a direct competitor of Licensor.
03. Modifications, Improvements, and Enhancements. Licensor is, and shall be, the sole owner of all inventions, discoveries, updates, improvements, modifications, and enhancements relating to the Software, whether in written or unwritten form and whether developed by Licensee or User. Licensor shall retain the exclusive right to reproduce, publish, patent, copyright, sell, license, or otherwise make use of such inventions, discoveries, updates, improvements, modifications, or enhancements.
a. This Agreement and the permission granted hereby shall terminate and any and all rights granted to User hereunder shall revest in Licensor:
i. Upon ten (10) days' written notice in the event that User, its officers, or employees violate any provision of this Agreement, including, but not limited to, confidentiality provisions; or
ii. Promptly upon the termination of the License Agreement or the Outsourcing Agreement, or both; or
iii. Should User, its successors, or permitted assigns suspend business, make an absolute assignment of the bulk of its assets for the benefit of creditors, consent to the appointment of a trustee, custodian, or receiver, or be declared insolvent or bankrupt; or if a trustee, custodian, or receiver is appointed for User for a substantial part of its property without its consent and is not discharged within sixty (60) days of such appointment; or if bankruptcy, reorganization, arrangement, insolvency, or liquidation proceedings are instituted by or against User and are not dismissed within sixty (60) days of the commencement thereof.
b. In the event of termination by reason of the User's failure to comply with any provision of this Agreement, or upon any act that shall give rise to Licensor's right to terminate, Licensor shall have the right, at any time, to terminate this Agreement and take immediate possession of the Software and documentation and all copies wherever located, without demand or notice. Within five (5) days after termination of the license, User will return to Licensor the Software and documentation and all copies wherever located, in the form provided by Licensor to Licensee or as modified, improved, updated, or enhanced, or upon request of Licensor destroy the Software, all documentation and all copies, and certify in writing that they have been destroyed. Termination under this paragraph shall not relieve User of its obligations under Section 2 of this Agreement, which shall remain in full force and effect until the earlier to occur of ten (10) years after the termination hereof or the expiration of all patents and copyrights maintained by Licensor with respect to the Software.
c. Without limiting any of the above provisions, in the event of termination as a result of User's failure to comply with any of its obligations under this Agreement, Licensee shall continue to be obligated for any payments due. Termination of this Agreement shall be in addition to, and not in lieu of, any equitable remedies available to Licensee or Licensor.
05. Restrictions on Transfer. The rights of User under this Agreement shall not be assigned, sublicensed, or in any other manner transferred or "outsourced" to any other person or entity by User without the prior written consent of Licensee and Licensor.
06. Governing Law. This Agreement shall be construed in accordance with the laws of the State of [state] and the federal laws of the United States of America.
IN WITNESS WHEREOF, the parties hereto have set their hands as of the day and year first above written.
[name of licensor]
[name of licensee]
[name of user]
ACKNOWLEDGEMENT BY NOTARY PUBLIC
State of ________)
On ________, before me, ________, Notary Public, personally appeared ________, [Name(s)] who proved to me on the basis of satisfactory evidence to be the person(s) whose names(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies) and that by his/her/their signatures on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.
I certify under the PENALTY OF PERJURY under the laws of the State of _________ that the foregoing paragraph is true and correct.
WITNESS my hand and official seal.
Name of Notary
My Commission Expires