software contract

Definition

Custom-software development agreement that stipulates the rights and responsibilities of a programmer (or vendor) and a principal or customer. It typically comprises of a non-exclusive license to use the software and includes provisions whereby (1) a copy of the source code is kept with an escrow agent for release to the customer should the programmer (or vendor) fail to comply with terms of the software development, and (2) insertion of special code in the software through which the programmer (or vendor) may remotely disable the program in case the customer fails to comply with his or her part of the contract. See also software license.