Software Escrow
At Ecru we have engaged in two forms of software escrow agreements:
- The first type of software escrow that we use is informal, to the extent that it is administered at a purely contractual level between the software developer (us) and the software buyer
- The other method which you might call a formal software escrow agreement is where the software source code is held by an escrow agent in trust, contingent on the fulfilment of the terms and conditions of the escrow agreement.
Source code escrow agents hold source code of software in escrow in the same way that financial escrow companies hold money. Upon the occurrence of a predetermined event (or events) which are established at the start of the escrow agreement, the buyer of the software can request that the software source code be handed over so that the investment in software by the buyer can be sustained.
Some escrow agreements are there to ensure that the software that is the core of the agreement can continue to be maintained and therefore remains fit for the purpose that was intended. Sometimes though the buyer might want to be able to continue to develop the software, in which case it is common to write in a set of limitations to the contract that allow some development, but restrict others.
