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When to Use an Application Services Agreement

This Application Service Provider Agreement, or ASP agreement, governs the relationship between an Application Service Provider and the Licensed User. The use of ASP contracts are important whenever your company provides clients access to licensed software and application servers as part of your scope of services. They're perfect for ASP web hosting relationships as well.

SLA (Service Level Agreement) Template Included
The Service Level Agreement template that is included with this agreement as Exhibit A will help you specify the terms of service and limit your liability for downtime.

What the ASP Agreement Protects
The Application Services License Agreement allows you to set specific limits on the authorized use of your software and application server services. Like other types of ASP contracts, it specifies who within your client’s firm has authorized access to your software and servers and how and when these resources can be used. The Application Services Agreement prohibits modification or reverse engineering of your software. It sets specific limits on the amount of storage space your client has available on your server and it protects your confidentiality and intellectual property rights. What’s more, should something go wrong for your client, this ASP Agreement limits your liability for deficiencies and defects in your software and ASP web hosting server.

Application Services Agreement Provisions Included

Grant of License

  • Use and Access
  • Price and Payment
  • Technical Support
  • Term and Termination
  • Ownership of Intellectual Property
  • Confidentiality
  • Warranty and Disclaimer
  • Limitation of Liability, Indemnification
  • Relations of Parties
  • Non-assignment
  • Arbitration
  • Attorney's Fees
  • Severability
  • Force Majeure
  • Waiver and Modification
  • Entire Agreement

Sample Text from the ASP Agreement Template

Grant of License

Subject to the terms and conditions herein, Licensor hereby grants Licensee a nonexclusive license to (i) access and execute (the "Software") on Licensor’s application server over the Internet, and (ii) transmit data related to Licensee's use of the Software over the Internet.

Use and Access

A. Subject to the restrictions on use as set forth herein, Licensee will have access to the Software and Licensor's application server for the purpose of using the software for its intended purpose and in accordance with the specifications set forth in any documentation relating to the Software provided by Licensor...

B. Licensee will use the Software only for its internal business operations and will not permit the Software to be used by or for the benefit of anyone other than Licensee. Licensee will not have the right to re-license or sell rights to access and/or use the Licensed Software or to transfer or assign rights to access or use the Software, except as expressly provided herein. Licensee may not modify, translate, reverse engineer, decompile or create derivative works based upon the Software...

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