) before final execution.
6. Have this document reviewed by qualified Washington-licensed legal counsel before use.
JURISDICTION: WA
LAST UPDATED: 2026-02-27
WASHINGTON-SPECIFIC NOTES:
- Governed by Washington law; venue in King County (Seattle)
- Trade secrets protected under the Washington Uniform Trade Secrets Act (RCW 19.108.010 - 19.108.940)
- Electronic signatures valid under the Washington UETA (RCW 1.80.010 et seq.)
- Data breach notification governed by RCW 19.255.010 (30-day notification deadline)
- Consumer protection under the Washington Consumer Protection Act (RCW 19.86)
- Washington My Health My Data Act (RCW 19.373) applies to consumer health data
- Legal interest rate: 12% per annum or 4 points above 26-week T-bill rate (RCW 19.52.020)
- Written contract statute of limitations: 6 years (RCW 4.16.040)
-->
SOURCE CODE ESCROW AGREEMENT
State of Washington
Effective Date: [__/__/____]
TABLE OF CONTENTS
- Parties and Recitals
- Definitions
- Deposit Materials
- Deposit and Update Procedures
- Verification and Testing
- Release Conditions
- Release Procedures
- Post-Release License Rights
- Fees and Payment
- Confidentiality and Security
- Trade Secret Protections
- Intellectual Property
- Warranties and Disclaimers
- Indemnification
- Limitation of Liability
- Term and Termination
- Governing Law and Dispute Resolution
- Washington-Specific Provisions
- Miscellaneous
- Signatures
- Schedules
1. PARTIES AND RECITALS
1.1 Parties. This Source Code Escrow Agreement (this "Agreement") is entered into as of [__/__/____] (the "Effective Date") by and among the following three parties:
(a) Licensor: [________________________________], a [________________________________] organized under the laws of [________________________________], with its principal place of business at [________________________________] ("Licensor");
(b) Beneficiary: [________________________________], a [________________________________] organized under the laws of [________________________________], with its principal place of business at [________________________________] ("Beneficiary"); and
(c) Escrow Agent: [________________________________], a [________________________________] organized under the laws of [________________________________], with its principal place of business at [________________________________] ("Escrow Agent").
Licensor, Beneficiary, and Escrow Agent are referred to individually as a "Party" and collectively as the "Parties."
1.2 Recitals.
WHEREAS, Licensor and Beneficiary have entered into that certain [________________________________] dated [__/__/____] (the "Master Agreement"), pursuant to which Licensor has licensed or provided access to certain proprietary software known as [________________________________] (the "Product") to Beneficiary;
WHEREAS, Beneficiary desires to ensure continued access to the source code and related materials for the Product in the event that Licensor is unable or unwilling to continue supporting the Product under the Master Agreement;
WHEREAS, Licensor is willing to deposit the source code and related materials for the Product with a neutral third-party escrow agent to provide such assurance to Beneficiary;
WHEREAS, Escrow Agent is in the business of providing technology escrow services and has agreed to serve as the neutral custodian of the Deposit Materials (as defined below) subject to the terms and conditions set forth herein;
WHEREAS, the Parties intend that this Agreement shall be governed by the laws of the State of Washington, including the Washington Uniform Trade Secrets Act (RCW 19.108) with respect to the protection of the Deposit Materials as trade secrets; and
WHEREAS, the Parties desire to set forth the terms and conditions under which the Deposit Materials will be held, maintained, and potentially released.
NOW, THEREFORE, in consideration of the mutual covenants and agreements set forth herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows:
2. DEFINITIONS
2.1 "Agreement" means this Source Code Escrow Agreement, including all Schedules attached hereto, as may be amended from time to time in accordance with Section 19.5.
2.2 "Beneficiary" means the party identified as such in Section 1.1(b) and any permitted successors or assigns.
2.3 "Business Day" means any day other than a Saturday, Sunday, or a day on which banks are authorized or required to be closed in the State of Washington.
2.4 "Confidential Information" means all non-public information disclosed by one Party to another in connection with this Agreement, including the Deposit Materials, trade secrets, business plans, customer lists, financial information, technical data, and any other proprietary information, whether disclosed orally, in writing, or in any other form.
2.5 "Deposit Materials" means all materials deposited or required to be deposited by Licensor with Escrow Agent pursuant to Section 3, including the Source Code, Object Code, Documentation, Build Environment Materials, and all Updates thereto.
2.6 "Documentation" means all technical documentation, user manuals, API documentation, architecture diagrams, database schemas, installation guides, deployment guides, and other written materials relating to the Product that are necessary to understand, compile, build, install, configure, maintain, and operate the Product.
2.7 "Effective Date" means the date first written above in Section 1.1.
2.8 "Escrow Agent" means the party identified as such in Section 1.1(c) and any permitted successors or assigns.
2.9 "Escrow Fee" means the fees payable to Escrow Agent for its services under this Agreement, as set forth in Schedule 1.
2.10 "Force Majeure Event" means any event beyond the reasonable control of the affected Party, including acts of God, fire, flood, earthquake, volcanic eruption, lahar, epidemic, pandemic, war, terrorism, civil unrest, labor disputes (other than those involving the affected Party's own employees), government actions, power failures, internet or telecommunications failures, or failures of third-party hosting providers, but excluding any event caused by the negligence or willful misconduct of the affected Party.
2.11 "Intellectual Property" means all patents, copyrights, trademarks, trade secrets, and any other intellectual property rights recognized under the laws of the State of Washington, the United States, or any foreign jurisdiction.
2.12 "Licensor" means the party identified as such in Section 1.1(a) and any permitted successors or assigns.
2.13 "Master Agreement" means the underlying software license agreement, SaaS agreement, or other agreement identified in the Recitals, together with all amendments, supplements, and addenda thereto.
2.14 "Object Code" means the machine-readable compiled or interpreted version of the Source Code.
2.15 "Product" means the software product identified in the Recitals, including all modules, components, and features licensed to Beneficiary under the Master Agreement.
2.16 "Release Conditions" means the conditions specified in Section 6 under which Escrow Agent is authorized to release the Deposit Materials to Beneficiary.
2.17 "Release Event" means the occurrence of one or more of the Release Conditions specified in Section 6.
2.18 "Source Code" means the human-readable programming code for the Product, written in any programming language, from which the Object Code is derived, including all comments, annotations, and programmer notes embedded therein.
2.19 "Subscription Term" means the period during which Beneficiary is entitled to use the Product under the Master Agreement.
2.20 "Trade Secret" means information, including a formula, pattern, compilation, program, device, method, technique, or process that derives independent economic value, actual or potential, from not being generally known to, and not being readily ascertainable by proper means by, other persons who can obtain economic value from its disclosure or use, and is the subject of efforts that are reasonable under the circumstances to maintain its secrecy, as defined under RCW 19.108.010.
2.21 "Update" means any new version, release, patch, hotfix, service pack, or other modification to the Deposit Materials that Licensor is required to deposit pursuant to Section 4.
2.22 "Verification" means the process of examining, testing, and validating the Deposit Materials as described in Section 5.
3. DEPOSIT MATERIALS
3.1 Scope of Deposit Materials. Licensor shall deposit with Escrow Agent a complete and accurate copy of all materials necessary to enable a reasonably skilled software developer to compile, build, install, configure, maintain, and operate the Product without the assistance or cooperation of Licensor. The Deposit Materials shall include, at a minimum, the following:
(a) Source Code. The complete source code for the Product, including all modules, libraries, frameworks, and components developed by or for Licensor, in all programming languages used, together with all comments, annotations, and programmer notes;
(b) Object Code. A current compiled or interpreted version of the Product corresponding to the version of the Source Code deposited;
(c) Build Environment Materials. All build scripts, makefiles, configuration files, compiler settings, linker settings, and other build automation tools necessary to compile the Source Code into functional Object Code, including specifications for the required build environment (operating system, compiler versions, tool chain versions);
(d) Database Materials. All database schemas, data dictionaries, stored procedures, triggers, migration scripts, seed data files, and database configuration files;
(e) API Documentation. Complete documentation of all application programming interfaces, including request and response formats, authentication mechanisms, error codes, and usage examples;
(f) Third-Party Components. A comprehensive list of all third-party software components, libraries, frameworks, and tools incorporated into or required by the Product, together with (i) the applicable license agreements or license terms for each such component, (ii) the version numbers of each component, and (iii) instructions for obtaining each component;
(g) Installation and Deployment Guides. Step-by-step instructions for installing, configuring, and deploying the Product in a production environment, including hardware and software requirements, network configuration, and security settings;
(h) Architecture Documentation. System architecture diagrams, data flow diagrams, component interaction diagrams, and other technical documentation describing the overall design and structure of the Product;
(i) Test Suites. All automated test scripts, test data, test configurations, and testing frameworks used by Licensor to verify the functionality and integrity of the Product, including unit tests, integration tests, and system tests;
(j) Version Identifiers. Clear identification of the version, release number, branch, and build number of all deposited materials, together with a changelog documenting changes from any previously deposited version; and
(k) Hash Values. SHA-256 cryptographic hash values for each file and directory deposited, generated at the time of deposit, to enable integrity verification.
3.2 Completeness Requirement. The Deposit Materials shall be sufficiently complete to enable Beneficiary, or a qualified third-party contractor engaged by Beneficiary, to independently compile, build, install, configure, and operate the Product in a manner substantially equivalent to the version of the Product then being provided to Beneficiary under the Master Agreement, without reliance on any proprietary tools, environments, or knowledge held exclusively by Licensor.
3.3 Format Requirements. All Deposit Materials shall be delivered in industry-standard, non-proprietary formats on commonly available storage media. Source code files shall be in plain text format. Documentation shall be in PDF, HTML, or Markdown format. All media shall be clearly labeled with the Product name, version number, deposit date, and Licensor's name.
3.4 Inventory. Each deposit shall be accompanied by a completed Deposit Materials Inventory in the form set forth in Schedule 2, which shall list all files and directories included in the deposit, together with a brief description of each item, file sizes, and SHA-256 hash values.
4. DEPOSIT AND UPDATE PROCEDURES
4.1 Initial Deposit. Licensor shall deliver the initial Deposit Materials to Escrow Agent within [____] calendar days after the Effective Date. The initial deposit shall include all materials described in Section 3.1 corresponding to the version of the Product then licensed or provided to Beneficiary under the Master Agreement.
4.2 Update Schedule. Following the initial deposit, Licensor shall deposit updated Deposit Materials with Escrow Agent:
(a) within [____] calendar days after each major release (i.e., a release that introduces significant new features or functionality) of the Product;
(b) within [____] calendar days after each minor release (i.e., a release that introduces incremental improvements or bug fixes) of the Product; and
(c) no less frequently than once per calendar quarter, even if no new release has occurred, to the extent any changes have been made to the Deposit Materials since the last deposit.
4.3 Deposit Delivery. Licensor shall deliver all Deposit Materials to Escrow Agent via [________________________________] (e.g., secure electronic transfer, encrypted physical media, secure cloud upload). All transmissions shall be encrypted using AES-256 or equivalent encryption, and all physical media shall be shipped via a nationally recognized overnight courier with tracking and signature confirmation.
4.4 Receipt Confirmation. Within five (5) Business Days of receiving a deposit, Escrow Agent shall (a) confirm receipt in writing to both Licensor and Beneficiary, (b) verify the integrity of the deposit by comparing SHA-256 hash values against those provided in the accompanying Deposit Materials Inventory, and (c) notify Licensor and Beneficiary of any discrepancies.
4.5 Incomplete Deposits. If Escrow Agent determines, whether through its own review or through a Verification conducted under Section 5, that a deposit is materially incomplete, Escrow Agent shall promptly notify both Licensor and Beneficiary. Licensor shall cure any deficiencies within [____] Business Days after receiving such notice. If Licensor fails to cure the deficiencies within such period, Beneficiary may invoke the remedies set forth in Section 6.1(e).
4.6 Licensor Representations Regarding Deposits. With each deposit, Licensor represents and warrants that (a) the Deposit Materials are complete and accurate in all material respects, (b) the Deposit Materials correspond to the version of the Product then being provided to Beneficiary under the Master Agreement, (c) the Deposit Materials include all information necessary to compile, build, install, and operate the Product as described in Section 3.2, and (d) Licensor has the legal right to deposit all materials included in the Deposit Materials.
5. VERIFICATION AND TESTING
5.1 Verification Levels. Beneficiary may request, and Escrow Agent shall perform, Verification of the Deposit Materials at any of the following levels:
(a) Level 1 -- Inventory Verification. Escrow Agent shall compare the contents of the deposit against the Deposit Materials Inventory provided by Licensor, verify that all listed files and directories are present, confirm file sizes and SHA-256 hash values, and prepare a written report of its findings. Level 1 Verification shall be completed within ten (10) Business Days of the request.
(b) Level 2 -- Compilation and Build Verification. In addition to the Level 1 procedures, Escrow Agent (or a qualified third-party technical expert engaged by Escrow Agent) shall attempt to compile and build the Source Code into functional Object Code using the build environment materials included in the deposit. Escrow Agent shall document whether the build was successful, identify any errors or warnings encountered, and prepare a written report. Level 2 Verification shall be completed within thirty (30) Business Days of the request.
(c) Level 3 -- Full Functional Verification. In addition to the Level 1 and Level 2 procedures, Escrow Agent (or a qualified third-party technical expert engaged by Escrow Agent) shall install and configure the compiled Product in a test environment and execute the test suites included in the deposit to verify that the Product functions in all material respects in accordance with its documentation. Escrow Agent shall document the test results and prepare a comprehensive written report. Level 3 Verification shall be completed within sixty (60) Business Days of the request.
5.2 Verification Costs. All costs and expenses associated with Verification shall be borne by the requesting Party, unless the Verification reveals material deficiencies in the Deposit Materials, in which case Licensor shall reimburse the requesting Party for all reasonable Verification costs within thirty (30) days of receiving the Verification report.
5.3 Deficiency Cure Period. If a Verification reveals any deficiencies in the Deposit Materials, Escrow Agent shall promptly notify Licensor and Beneficiary of the deficiencies. Licensor shall cure all identified deficiencies within [____] Business Days after receiving the Verification report and shall deposit corrected materials with Escrow Agent. Escrow Agent shall conduct a follow-up Verification at the same level as the original Verification, at Licensor's expense, to confirm that all deficiencies have been cured.
5.4 Verification Reports. All Verification reports shall be provided in writing to both Licensor and Beneficiary simultaneously. Verification reports shall include (a) a summary of the procedures performed, (b) a detailed list of findings, (c) identification of any deficiencies, and (d) recommendations for remediation.
5.5 Re-Verification Rights. Beneficiary may request Verification no more than [____] times per calendar year at Beneficiary's expense, and additionally following any deposit update. Licensor may request Verification of its own deposits at any time at Licensor's expense.
6. RELEASE CONDITIONS
6.1 Release Events. Escrow Agent shall be authorized to release the Deposit Materials to Beneficiary upon the occurrence of any of the following Release Events:
(a) Insolvency or Bankruptcy. Licensor (i) files a voluntary petition in bankruptcy under Title 11 of the United States Code or under any similar Washington or federal insolvency law, including the Washington insolvency provisions of RCW Title 7, (ii) becomes the subject of an involuntary bankruptcy petition that is not dismissed within sixty (60) days after filing, (iii) makes a general assignment for the benefit of creditors, (iv) has a receiver, trustee, or custodian appointed for all or substantially all of its assets, (v) admits in writing its inability to pay its debts as they become due, or (vi) is dissolved, liquidated, or wound up. For purposes of this subsection, the Parties acknowledge that pursuant to 11 U.S.C. Section 365(n), Beneficiary, as a licensee of intellectual property, may retain its rights under the Master Agreement and this Agreement notwithstanding the rejection of such agreements by a trustee in bankruptcy, provided that Beneficiary continues to make all payments due thereunder.
(b) Cessation of Product Support. Licensor ceases to conduct business in the ordinary course with respect to the Product, permanently discontinues development, maintenance, or support of the Product, or provides written notice to Beneficiary of its intention to do so, and fails to designate a qualified successor to assume its obligations under the Master Agreement within ninety (90) days after such cessation or notice.
(c) Material Breach of Maintenance Obligations. Licensor commits a material breach of its maintenance, support, or update obligations under the Master Agreement or this Agreement, and such breach remains uncured for a period of [____] days after Beneficiary delivers written notice of such breach to Licensor, specifying the nature of the breach in reasonable detail.
(d) Extended Service Outage. In the event the Product is provided as a software-as-a-service or cloud-based solution, Licensor fails to provide the Product with an availability level meeting the service level commitments set forth in the Master Agreement for a period of [____] consecutive calendar days, and such failure is not attributable to a Force Majeure Event, Beneficiary's systems or actions, or a scheduled maintenance window.
(e) Failure to Deposit or Update. Licensor fails to make the initial deposit required by Section 4.1 or fails to provide required Updates pursuant to Section 4.2, and such failure remains uncured for [____] days after Beneficiary delivers written notice of such failure to Licensor.
6.2 Exclusions from Release Events. The following events shall not, by themselves, constitute Release Events:
(a) A merger, acquisition, or change of control of Licensor, provided that the surviving or acquiring entity assumes Licensor's obligations under the Master Agreement and this Agreement;
(b) A Force Majeure Event, provided that Licensor resumes performance within a reasonable period after the cessation of the Force Majeure Event and in no event longer than ninety (90) days;
(c) Routine scheduled maintenance or temporary service interruptions that are disclosed in advance and are within the service level parameters set forth in the Master Agreement; or
(d) Any dispute between the Parties that does not rise to the level of a material breach as described in Section 6.1(c).
6.3 Bankruptcy Considerations Under Washington and Federal Law. The Parties expressly acknowledge and agree that, in the event Licensor becomes a debtor in a bankruptcy proceeding, the provisions of 11 U.S.C. Section 365(n) shall apply to this Agreement and the Master Agreement. Beneficiary shall have the right to retain its license rights to the Deposit Materials and the Product, including the right to receive the Deposit Materials from Escrow Agent, to the extent permitted under Section 365(n), provided that Beneficiary continues to perform its payment obligations. The Parties further agree that the Deposit Materials constitute "intellectual property" as defined in 11 U.S.C. Section 101(35A). The Parties acknowledge that the United States Bankruptcy Court for the Western District of Washington (Seattle Division) or the Eastern District of Washington would have jurisdiction over any such proceeding, depending on the location of Licensor's principal place of business.
7. RELEASE PROCEDURES
7.1 Release Request. To initiate a release of the Deposit Materials, Beneficiary shall deliver to Escrow Agent a written Release Request, substantially in the form set forth in Schedule 4, which shall include:
(a) A declaration under penalty of perjury under the laws of the State of Washington (pursuant to RCW 9A.72.085), certifying that one or more Release Events have occurred;
(b) A detailed description of the Release Event(s) relied upon, including the date(s) of occurrence and all material facts supporting the claim;
(c) Copies of all notices delivered to Licensor in connection with the Release Event(s), together with proof of delivery; and
(d) Any other supporting documentation reasonably necessary to substantiate the occurrence of the Release Event(s).
7.2 Licensor Notification. Within two (2) Business Days of receiving a Release Request, Escrow Agent shall deliver a copy of the Release Request and all accompanying documentation to Licensor by the notice methods specified in Section 19.1.
7.3 Licensor Objection Period. Licensor shall have [____] Business Days after receiving the Release Request (the "Objection Period") to deliver a written objection to Escrow Agent, which shall include (a) a detailed statement of the grounds for the objection, (b) supporting documentation, and (c) a declaration under penalty of perjury under Washington law contesting the occurrence of the Release Event(s) claimed by Beneficiary.
7.4 Release Without Objection. If Licensor does not deliver a timely objection within the Objection Period, Escrow Agent shall release the Deposit Materials to Beneficiary within five (5) Business Days after the expiration of the Objection Period.
7.5 Contested Release. If Licensor delivers a timely objection, Escrow Agent shall not release the Deposit Materials and shall promptly notify both Licensor and Beneficiary that the release is contested. The Parties shall resolve the dispute in accordance with the dispute resolution provisions set forth in Section 17. Escrow Agent shall release or withhold the Deposit Materials in accordance with (a) a written agreement signed by both Licensor and Beneficiary, (b) a final, non-appealable order of a court of competent jurisdiction in the State of Washington, or (c) a final arbitration award, if the Parties have agreed to arbitrate the dispute.
7.6 Emergency Release. In the event that Beneficiary reasonably determines that an emergency exists requiring immediate access to the Deposit Materials to prevent imminent and irreparable harm to Beneficiary's business operations (including, without limitation, a catastrophic system failure affecting critical business functions), Beneficiary may request an emergency release by delivering to Escrow Agent a written request accompanied by a declaration describing the emergency circumstances. Escrow Agent shall notify Licensor immediately upon receipt of such request. If Licensor does not object within forty-eight (48) hours, Escrow Agent shall release the Deposit Materials. If Licensor objects, Beneficiary may seek an emergency temporary restraining order or preliminary injunction from a court of competent jurisdiction in Washington.
7.7 Partial Release. Beneficiary may request the release of specific portions of the Deposit Materials rather than the entirety, and Escrow Agent shall comply with such request to the extent that the requested materials are reasonably separable from the remaining Deposit Materials.
8. POST-RELEASE LICENSE RIGHTS
8.1 License Grant Upon Release. Upon a valid release of the Deposit Materials pursuant to Section 7, Licensor hereby grants to Beneficiary a non-exclusive, non-transferable (except as provided in Section 19.2), irrevocable, perpetual (subject to Section 8.5), royalty-free license to use, copy, modify, compile, and create derivative works of the Deposit Materials solely for the purpose of (a) maintaining, supporting, and operating the Product for Beneficiary's internal business purposes, (b) fixing bugs, errors, and security vulnerabilities in the Product, and (c) making modifications reasonably necessary to ensure the continued functionality of the Product in Beneficiary's operating environment.
8.2 Restrictions. The license granted under Section 8.1 is subject to the following restrictions:
(a) Beneficiary shall not commercialize, distribute, sell, sublicense, or otherwise make the Deposit Materials or any derivative works available to any third party, except as expressly permitted in Section 8.2(b);
(b) Beneficiary may engage qualified third-party contractors and maintenance vendors to perform maintenance and support services on the Product using the Deposit Materials, provided that each such contractor or vendor executes a written confidentiality agreement with terms no less protective than those set forth in Section 10;
(c) Beneficiary shall not use the Deposit Materials to develop a competing product or service; and
(d) Beneficiary shall comply with all applicable third-party license terms for any third-party components included in the Deposit Materials.
8.3 Confidentiality Obligations. Beneficiary's obligation to maintain the confidentiality of the Deposit Materials shall survive any release and shall continue in accordance with Section 10.
8.4 Third-Party Component Compliance. Beneficiary acknowledges that the Deposit Materials may include third-party components subject to separate license terms. Beneficiary shall comply with all such third-party license terms and shall be solely responsible for obtaining any additional licenses required for its use of such third-party components following a release.
8.5 Duration of Post-Release Rights. The license granted under Section 8.1 shall continue for the longer of (a) the remaining term of the Subscription Term under the Master Agreement had the Master Agreement not been terminated, or (b) a period of [____] years from the date of release, after which the license shall terminate and Beneficiary shall return or destroy all copies of the Deposit Materials in its possession.
9. FEES AND PAYMENT
9.1 Fee Structure. The fees payable under this Agreement shall be as set forth in Schedule 1, which shall include the following categories:
(a) Escrow Establishment Fee. A one-time fee payable upon execution of this Agreement for the establishment of the escrow account and initial administrative setup;
(b) Annual Storage Fee. An annual fee payable in advance on each anniversary of the Effective Date for the secure storage and maintenance of the Deposit Materials;
(c) Update Processing Fee. A per-deposit fee payable upon each deposit of updated Deposit Materials under Section 4;
(d) Verification Fees. Fees payable for each Verification conducted under Section 5, calculated separately for Level 1, Level 2, and Level 3 Verifications; and
(e) Release Processing Fee. A fee payable upon the processing of a Release Request under Section 7.
9.2 Payment Responsibility. Unless otherwise agreed in writing by the Parties:
(a) The Escrow Establishment Fee and Annual Storage Fee shall be paid by [________________________________] (Licensor/Beneficiary/split equally);
(b) Update Processing Fees shall be paid by Licensor;
(c) Verification Fees shall be paid by the requesting Party, subject to reimbursement as provided in Section 5.2; and
(d) Release Processing Fees shall be paid by Beneficiary.
9.3 Payment Terms. All invoices issued by Escrow Agent shall be payable within thirty (30) days of the invoice date. All payments shall be made in United States dollars by wire transfer, ACH, or check to the account designated by Escrow Agent.
9.4 Late Payment. Any amount not paid when due shall bear interest at the lesser of (a) one and one-half percent (1.5%) per month, or (b) the maximum rate permitted under Washington law, which is the higher of twelve percent (12%) per annum or four percentage points above the equivalent coupon issue yield of the average bill rate for twenty-six week Treasury bills as established by the Board of Governors of the Federal Reserve System, pursuant to RCW 19.52.020, calculated from the due date until paid in full. The right to charge interest shall not limit any other remedies available to the unpaid Party. The Parties acknowledge that the penalties for charging usurious interest rates under RCW 19.52.030 include forfeiture of interest and costs.
9.5 Fee Adjustments. Escrow Agent may adjust its fees no more than once per calendar year upon not less than sixty (60) days' prior written notice to Licensor and Beneficiary. Fee increases shall not exceed five percent (5%) of the then-current fees in any single adjustment, unless such increase is necessitated by extraordinary circumstances documented in writing.
9.6 Taxes. All fees are exclusive of any applicable federal, state, or local taxes, duties, or assessments. The paying Party shall be responsible for all such taxes (other than taxes based on Escrow Agent's net income), including Washington business and occupation ("B&O") tax and retail sales tax as applicable, and shall remit such taxes directly to the applicable taxing authority or reimburse Escrow Agent for any such taxes paid by Escrow Agent.
10. CONFIDENTIALITY AND SECURITY
10.1 Confidential Information. Each Party acknowledges that in the course of performing its obligations under this Agreement, it may receive or have access to Confidential Information of the other Parties. The term "Confidential Information" includes, without limitation, the Deposit Materials, the terms and conditions of this Agreement, trade secrets, business plans, financial information, customer data, technical data, product roadmaps, and all other information marked as confidential or that a reasonable person would understand to be confidential given the nature of the information and the circumstances of disclosure.
10.2 Exclusions. Confidential Information does not include information that (a) is or becomes publicly available through no fault of the receiving Party, (b) was already known to the receiving Party at the time of disclosure without a duty of confidentiality, (c) is independently developed by the receiving Party without use of or reference to the disclosing Party's Confidential Information, or (d) is rightfully obtained by the receiving Party from a third party without restriction on disclosure.
10.3 Obligations. Each Party shall (a) hold the other Parties' Confidential Information in strict confidence, (b) not disclose such Confidential Information to any third party except as expressly permitted under this Agreement or with the prior written consent of the disclosing Party, (c) use such Confidential Information only for the purposes of performing its obligations or exercising its rights under this Agreement, and (d) protect such Confidential Information using the same degree of care it uses to protect its own confidential information, but in no event less than reasonable care.
10.4 Escrow Agent Security Requirements. Escrow Agent shall maintain the following minimum security measures with respect to the Deposit Materials:
(a) Encryption. All Deposit Materials shall be encrypted at rest using AES-256 encryption or an equivalent industry-standard encryption algorithm, and all transmissions of Deposit Materials shall be encrypted in transit using TLS 1.2 or higher;
(b) Access Controls. Access to the Deposit Materials shall be restricted to authorized Escrow Agent personnel on a need-to-know basis, with individual user authentication and audit logging of all access events;
(c) Physical Security. Deposit Materials stored on physical media shall be maintained in a secure, access-controlled facility with environmental controls (temperature, humidity, fire suppression) appropriate for the storage of electronic media;
(d) SOC 2 Compliance. Escrow Agent shall maintain SOC 2 Type II certification (or equivalent) and shall provide a copy of its most recent audit report to Licensor and Beneficiary upon request;
(e) Redundancy. Escrow Agent shall maintain at least one (1) geographically separate backup copy of all Deposit Materials;
(f) Disaster Recovery. Escrow Agent shall maintain a disaster recovery plan that provides for the recovery of all Deposit Materials within a recovery time objective of seventy-two (72) hours; and
(g) Personnel. All Escrow Agent personnel with access to the Deposit Materials shall be subject to background checks and shall have executed confidentiality agreements with terms at least as protective as those in this Section 10.
10.5 Data Breach Notification. In the event of any actual or reasonably suspected unauthorized access to, acquisition of, or disclosure of the Deposit Materials or other Confidential Information held by Escrow Agent (a "Security Breach"), Escrow Agent shall (a) notify Licensor and Beneficiary within forty-eight (48) hours of discovering the Security Breach, (b) cooperate fully with Licensor and Beneficiary in investigating the Security Breach and mitigating its effects, (c) take all reasonable steps to contain and remediate the Security Breach, and (d) comply with all applicable data breach notification requirements under Washington law, including RCW 19.255.010, which requires notification to affected Washington residents in the most expedient time possible and without unreasonable delay, and no later than thirty (30) days after the breach was discovered. Additionally, if the breach affects more than five hundred (500) Washington residents, Escrow Agent shall notify the Washington Attorney General within thirty (30) days pursuant to RCW 19.255.010.
10.6 Duration of Confidentiality Obligations. The obligations set forth in this Section 10 shall survive the expiration or termination of this Agreement and shall continue for a period of five (5) years from the date of disclosure of the applicable Confidential Information, or indefinitely with respect to any information that constitutes a Trade Secret under Washington law.
10.7 Return or Destruction. Upon the expiration or termination of this Agreement (other than in connection with a release of the Deposit Materials to Beneficiary), each Party shall, at the disclosing Party's election, return or destroy all Confidential Information of the disclosing Party in its possession, and shall certify such return or destruction in writing, except that each Party may retain one (1) archival copy for legal compliance purposes.
11. TRADE SECRET PROTECTIONS
11.1 Trade Secret Status. The Parties acknowledge and agree that the Deposit Materials, including the Source Code and related Documentation, constitute Trade Secrets of Licensor within the meaning of the Washington Uniform Trade Secrets Act (RCW 19.108.010 - 19.108.940). Specifically, the Deposit Materials derive independent economic value from not being generally known to, and not being readily ascertainable by proper means by, other persons who can obtain economic value from their disclosure or use, and Licensor has taken reasonable measures to maintain their secrecy.
11.2 Definition Under Washington Law. For purposes of this Agreement, the term "Trade Secret" shall have the meaning set forth in RCW 19.108.010, which defines a trade secret as information, including a formula, pattern, compilation, program, device, method, technique, or process that (a) derives independent economic value, actual or potential, from not being generally known to, and not being readily ascertainable by proper means by, other persons who can obtain economic value from its disclosure or use, and (b) is the subject of efforts that are reasonable under the circumstances to maintain its secrecy.
11.3 Reasonable Measures. Each Party shall take all reasonable measures to maintain the trade secret status of the Deposit Materials, including (a) limiting access to the Deposit Materials to authorized personnel on a need-to-know basis, (b) requiring all persons with access to the Deposit Materials to execute written confidentiality agreements, (c) implementing physical and electronic security measures to prevent unauthorized access, and (d) marking all copies of the Deposit Materials with appropriate proprietary legends.
11.4 Escrow Agent Obligations. Escrow Agent acknowledges its special responsibility as custodian of the Deposit Materials and agrees that its custody and handling of the Deposit Materials shall not diminish or destroy the trade secret status of such materials. Escrow Agent shall implement and maintain the security measures specified in Section 10.4 and shall not disclose, copy, or use the Deposit Materials for any purpose other than as expressly authorized under this Agreement.
11.5 Injunctive Relief. The Parties acknowledge that the unauthorized disclosure, use, or misappropriation of the Deposit Materials would cause irreparable harm for which monetary damages would be inadequate. Accordingly, in the event of any actual or threatened misappropriation of Trade Secrets, the aggrieved Party shall be entitled to seek injunctive relief pursuant to RCW 19.108.020, including temporary restraining orders and preliminary and permanent injunctions, in addition to all other remedies available at law or in equity, without the necessity of posting a bond or other security (or, if a bond is required by the court, in a nominal amount).
11.6 Misappropriation Remedies. In addition to injunctive relief, a Party whose Trade Secrets have been misappropriated shall be entitled to recover damages pursuant to RCW 19.108.030, including (a) actual damages measured by the loss caused by the misappropriation and any unjust enrichment not accounted for in the actual damages, or (b) in lieu of actual damages, a reasonable royalty for the unauthorized use. In the case of willful and malicious misappropriation, the court may award exemplary damages in an amount not to exceed twice the amount of actual damages.
11.7 Statute of Limitations for Trade Secret Claims. Pursuant to RCW 19.108.040, an action for misappropriation of trade secrets must be brought within three (3) years after the misappropriation is discovered or by the exercise of reasonable diligence should have been discovered.
11.8 Interaction with Post-Release License. Upon a valid release of the Deposit Materials, Beneficiary shall continue to treat the Deposit Materials as Trade Secrets to the extent such materials remain eligible for trade secret protection. The license granted under Section 8 shall not be construed as a waiver of Licensor's trade secret rights, and Beneficiary's possession and use of the Deposit Materials under such license shall be subject to the confidentiality and security obligations set forth in Sections 10 and 11.
12. INTELLECTUAL PROPERTY
12.1 Ownership. Nothing in this Agreement shall be construed as transferring any ownership rights in any Intellectual Property from one Party to another. Licensor retains all right, title, and interest in and to the Deposit Materials and the Product, including all Intellectual Property rights therein. Beneficiary retains all right, title, and interest in and to its pre-existing Intellectual Property. Escrow Agent retains all right, title, and interest in and to its proprietary systems, processes, and methodologies.
12.2 No Transfer. The deposit of materials with Escrow Agent under this Agreement does not constitute a transfer, assignment, or conveyance of any Intellectual Property rights to Escrow Agent or Beneficiary, except for the limited license rights expressly granted under Section 8 upon a valid release.
12.3 Licensor Representations. Licensor represents and warrants that (a) it is the sole and exclusive owner of all Intellectual Property rights in the Deposit Materials, or has obtained all necessary licenses, permissions, and consents from third parties to deposit such materials, (b) the Deposit Materials do not, to the best of Licensor's knowledge, infringe, misappropriate, or otherwise violate any Intellectual Property rights of any third party, and (c) there are no pending or threatened claims, actions, or proceedings alleging that the Deposit Materials infringe any third party's Intellectual Property rights.
12.4 Third-Party IP Components. To the extent the Deposit Materials include third-party components, Licensor represents that it has the right to include such components in the deposit and that the inclusion does not violate any applicable license terms. Licensor shall identify all third-party components in the Deposit Materials Inventory (Schedule 2) and shall provide copies of or references to the applicable license agreements.
12.5 Feedback. To the extent that Beneficiary provides any suggestions, recommendations, or feedback regarding the Product or the Deposit Materials ("Feedback"), Beneficiary grants to Licensor a non-exclusive, royalty-free, perpetual, irrevocable license to use, reproduce, modify, and incorporate such Feedback into the Product or any other products or services without obligation to Beneficiary.
13. WARRANTIES AND DISCLAIMERS
13.1 Licensor Warranties. Licensor represents and warrants to Beneficiary and Escrow Agent that: (a) Licensor has the full corporate power and authority to enter into this Agreement and to perform its obligations hereunder; (b) this Agreement constitutes a legal, valid, and binding obligation of Licensor, enforceable against Licensor in accordance with its terms; (c) Licensor has the legal right to deposit all Deposit Materials with Escrow Agent under this Agreement, and such deposit does not violate any contractual obligation of Licensor to any third party; (d) the Deposit Materials are complete and accurate in all material respects and correspond to the version of the Product provided to Beneficiary under the Master Agreement; (e) the Deposit Materials do not contain any known malware, viruses, trojan horses, worms, time bombs, or other malicious code intentionally inserted by Licensor; and (f) Licensor is the owner of, or has obtained valid licenses for, all Intellectual Property rights in the Deposit Materials, including all third-party components.
13.2 Escrow Agent Warranties. Escrow Agent represents and warrants to Licensor and Beneficiary that: (a) Escrow Agent has the full corporate power and authority to enter into this Agreement and to perform its obligations hereunder; (b) Escrow Agent shall perform its services in a professional and workmanlike manner, consistent with generally accepted industry standards for technology escrow services; (c) Escrow Agent shall maintain the security and integrity of the Deposit Materials in accordance with Section 10.4; and (d) Escrow Agent maintains adequate insurance coverage for the services provided under this Agreement.
13.3 Beneficiary Warranties. Beneficiary represents and warrants to Licensor and Escrow Agent that: (a) Beneficiary has the full corporate power and authority to enter into this Agreement; and (b) Beneficiary shall use the Deposit Materials, if released, solely in accordance with the license terms set forth in Section 8 and the confidentiality obligations set forth in Sections 10 and 11.
13.4 Disclaimer. EXCEPT FOR THE EXPRESS WARRANTIES SET FORTH IN THIS SECTION 13, THE DEPOSIT MATERIALS ARE PROVIDED "AS IS" UPON RELEASE TO BENEFICIARY. LICENSOR MAKES NO WARRANTIES, EXPRESS OR IMPLIED, WITH RESPECT TO THE DEPOSIT MATERIALS FOLLOWING RELEASE, INCLUDING ANY IMPLIED WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, TITLE, OR NON-INFRINGEMENT.
14. INDEMNIFICATION
14.1 Licensor Indemnification. Licensor shall defend, indemnify, and hold harmless Beneficiary and its officers, directors, employees, agents, successors, and assigns from and against any and all third-party claims, actions, suits, proceedings, losses, damages, liabilities, costs, and expenses (including reasonable attorneys' fees) arising out of or relating to (a) any claim that the Deposit Materials infringe, misappropriate, or otherwise violate any Intellectual Property rights of any third party, (b) any breach by Licensor of its representations or warranties set forth in Section 13.1, or (c) Licensor's gross negligence or willful misconduct in connection with this Agreement.
14.2 Beneficiary Indemnification. Beneficiary shall defend, indemnify, and hold harmless Licensor and its officers, directors, employees, agents, successors, and assigns from and against any and all third-party claims, actions, suits, proceedings, losses, damages, liabilities, costs, and expenses (including reasonable attorneys' fees) arising out of or relating to (a) Beneficiary's use of the Deposit Materials following a release in a manner that exceeds the scope of the license granted under Section 8, or (b) Beneficiary's gross negligence or willful misconduct in connection with this Agreement.
14.3 Escrow Agent Indemnification. Escrow Agent shall defend, indemnify, and hold harmless Licensor and Beneficiary from and against any and all third-party claims, actions, suits, proceedings, losses, damages, liabilities, costs, and expenses (including reasonable attorneys' fees) arising out of or relating to Escrow Agent's gross negligence or willful misconduct, including any Security Breach caused by Escrow Agent's failure to maintain the security measures required by Section 10.4.
14.4 Indemnification Procedures. The Indemnified Party shall (a) promptly notify the Indemnifying Party in writing of any claim for which indemnification is sought, (b) give the Indemnifying Party sole control of the defense and settlement, provided that the Indemnifying Party shall not settle any claim imposing obligation on the Indemnified Party without prior written consent, and (c) provide reasonable cooperation at the Indemnifying Party's expense. Failure to provide prompt notice shall not relieve the Indemnifying Party except to the extent materially prejudiced.
14.5 Contribution and Comparative Fault. If a court determines that any loss was caused by the joint fault of multiple Parties, the Parties shall contribute in proportion to their respective degrees of fault, consistent with Washington's principles of comparative fault under RCW 4.22.
15. LIMITATION OF LIABILITY
15.1 Aggregate Cap. EXCEPT AS SET FORTH IN SECTION 15.3, THE AGGREGATE LIABILITY OF EACH PARTY (OTHER THAN ESCROW AGENT) UNDER THIS AGREEMENT SHALL NOT EXCEED THE TOTAL FEES PAID OR PAYABLE DURING THE TWELVE (12) MONTH PERIOD IMMEDIATELY PRECEDING THE EVENT GIVING RISE TO THE CLAIM. ESCROW AGENT'S AGGREGATE LIABILITY SHALL NOT EXCEED THE TOTAL FEES ACTUALLY PAID TO ESCROW AGENT DURING SUCH PERIOD.
15.2 Consequential Damages Exclusion. EXCEPT AS SET FORTH IN SECTION 15.3, NO PARTY SHALL BE LIABLE FOR ANY INDIRECT, INCIDENTAL, CONSEQUENTIAL, SPECIAL, PUNITIVE, OR EXEMPLARY DAMAGES, INCLUDING LOST PROFITS, LOST REVENUE, LOSS OF DATA, OR BUSINESS INTERRUPTION, REGARDLESS OF THEORY OF LIABILITY AND WHETHER ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.
15.3 Carve-Outs. The limitations in Sections 15.1 and 15.2 shall not apply to (a) indemnification obligations under Section 14, (b) breach of confidentiality obligations under Section 10, (c) misappropriation of Trade Secrets, (d) willful misconduct or gross negligence, (e) Licensor's breach of IP representations under Section 12.3, or (f) any liability that cannot be limited under applicable Washington law.
15.4 Essential Purpose. THE PARTIES ACKNOWLEDGE THAT THESE LIMITATIONS ARE AN ESSENTIAL ELEMENT OF THE BARGAIN AND THAT FEES REFLECT THE ALLOCATION OF RISK. THESE LIMITATIONS SHALL APPLY EVEN IF ANY LIMITED REMEDY FAILS OF ITS ESSENTIAL PURPOSE, TO THE FULLEST EXTENT PERMITTED BY WASHINGTON LAW.
16. TERM AND TERMINATION
16.1 Term. This Agreement shall commence on the Effective Date and shall continue for an initial term coterminous with the Master Agreement (the "Initial Term"), unless earlier terminated in accordance with this Section 16.
16.2 Renewal. This Agreement shall automatically renew for successive one (1) year periods (each a "Renewal Term"), unless (a) the Master Agreement has expired or been terminated, (b) any Party delivers written notice of non-renewal at least sixty (60) days prior to the expiration of the then-current term, or (c) this Agreement is earlier terminated.
16.3 Termination for Cause. Any Party may terminate this Agreement upon written notice if: (a) another Party commits a material breach that remains uncured for thirty (30) days after written notice; (b) another Party becomes the subject of a bankruptcy petition, makes an assignment for creditors, or is placed in receivership; or (c) Escrow Agent ceases to maintain the required security standards and fails to cure within sixty (60) days after notice.
16.4 Termination by Mutual Agreement. This Agreement may be terminated at any time by written agreement of all three Parties.
16.5 Effect of Termination. Upon expiration or termination (other than in connection with a valid release): (a) Escrow Agent shall return or destroy the Deposit Materials at Licensor's election within thirty (30) days; (b) fees owed for services performed prior to termination remain payable; (c) confidentiality obligations survive per their terms; and (d) provisions that by their nature should survive (including Sections 2, 8 (if a release has occurred), 10, 11, 12, 13.4, 14, 15, 17, and 18) shall survive.
16.6 Wind-Down Period. The Parties shall cooperate in good faith to ensure an orderly wind-down within sixty (60) days, including completion of pending Verification or release procedures and transition to a successor escrow agent if applicable.
17. GOVERNING LAW AND DISPUTE RESOLUTION
17.1 Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of Washington, without regard to its conflict of laws principles. The UN Convention on Contracts for the International Sale of Goods shall not apply.
17.2 Exclusive Venue. Subject to Section 17.7, any action or proceeding shall be brought exclusively in the Superior Court of the State of Washington for King County, or in the United States District Court for the Western District of Washington at Seattle, and each Party irrevocably consents to the personal jurisdiction and venue of such courts and waives any objection based on forum non conveniens.
17.3 Jury Waiver. TO THE FULLEST EXTENT PERMITTED BY WASHINGTON LAW, EACH PARTY KNOWINGLY, VOLUNTARILY, AND INTENTIONALLY WAIVES ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT, WHETHER SOUNDING IN CONTRACT, TORT, OR OTHERWISE. EACH PARTY CERTIFIES THAT NO REPRESENTATIVE OF ANY OTHER PARTY HAS REPRESENTED THAT SUCH OTHER PARTY WOULD NOT SEEK TO ENFORCE THIS WAIVER. EACH PARTY ACKNOWLEDGES THAT IT HAS BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY THE MUTUAL WAIVERS IN THIS SECTION. THIS WAIVER IS KNOWING AND VOLUNTARY AND HAS BEEN NEGOTIATED BY THE PARTIES WITH THE ADVICE OF COUNSEL.
17.4 Escalation. Prior to initiating any formal legal proceeding (other than injunctive relief), the Parties shall attempt to resolve disputes through good-faith executive negotiation for at least thirty (30) days.
17.5 Mediation. If not resolved through negotiation within thirty (30) days, any Party may submit the dispute to non-binding mediation in Seattle, Washington, with costs shared equally.
17.6 Arbitration (Optional). ☐ If this box is checked, any unresolved dispute shall be submitted to binding arbitration in Seattle, Washington, administered by the AAA under its Commercial Arbitration Rules. The arbitration shall be conducted by a single arbitrator with technology and IP experience. The arbitrator's award shall be final and binding and may be entered as a judgment in any court.
17.7 Injunctive Relief Carve-Out. Notwithstanding any other provision, any Party may seek temporary restraining orders, preliminary injunctions, or other equitable relief from any court to protect its IP rights, trade secrets, or Confidential Information, without first engaging in escalation, mediation, or arbitration.
17.8 Prevailing Party Attorneys' Fees. In any action to enforce or interpret this Agreement, the prevailing Party shall be entitled to recover reasonable attorneys' fees and costs.
17.9 Statute of Limitations. All claims shall be subject to the applicable statute of limitations under Washington law, including the six (6) year limitation for written contract actions set forth in RCW 4.16.040.
18. WASHINGTON-SPECIFIC PROVISIONS
18.1 Electronic Signatures. This Agreement may be executed and delivered by electronic signature in accordance with the Washington Uniform Electronic Transactions Act (RCW 1.80.010 et seq.). Electronic signatures shall have the same legal effect, validity, and enforceability as original handwritten signatures. Pursuant to RCW 1.80.050, a record or signature may not be denied legal effect or enforceability solely because it is in electronic form.
18.2 Consumer Protection. Nothing in this Agreement shall be construed to limit, waive, or otherwise affect any rights that any Party may have under the Washington Consumer Protection Act (RCW 19.86), which declares unfair methods of competition and unfair or deceptive acts or practices in the conduct of any trade or commerce unlawful (RCW 19.86.020). The Parties acknowledge that RCW 19.86.090 provides for private civil actions, including treble damages, for persons injured by violations.
18.3 Washington My Health My Data Act. To the extent that any Deposit Materials contain consumer health data as defined under the Washington My Health My Data Act (RCW 19.373), the Parties shall comply with all applicable requirements of the Act, including provisions regarding collection, sharing, and sale of consumer health data, consumer consent, privacy policies, and data protection. Violations of RCW 19.373 constitute unfair or deceptive acts under the Consumer Protection Act (RCW 19.86).
18.4 Non-Compete Limitations. The Parties acknowledge that Washington restricts non-competition agreements pursuant to RCW 49.62. To the extent that any provision of this Agreement could be construed as a non-competition agreement, such provision shall be enforceable only to the extent permitted under RCW 49.62, and nothing in this Agreement shall be interpreted to impose non-competition obligations beyond those permitted by Washington law.
18.5 Bankruptcy Considerations. In the event that Licensor becomes a debtor in a case under Title 11 of the United States Code, the Parties acknowledge and agree that: (a) Beneficiary's rights constitute rights to "intellectual property" as defined in 11 U.S.C. Section 101(35A); (b) pursuant to 11 U.S.C. Section 365(n), Beneficiary may retain its rights if the trustee rejects this Agreement, provided Beneficiary continues payments; (c) the deposit with Escrow Agent creates an independent right of access supplementary to the Master Agreement; and (d) no Party shall act to defeat the purposes of this Section or Section 365(n).
18.6 State Regulatory Requirements. The Parties shall comply with all applicable laws, rules, and regulations of the State of Washington, including any licensing or registration requirements applicable to technology escrow services.
18.7 Tax Considerations. All fees are subject to applicable Washington state and local taxes, including the Washington Business and Occupation Tax (RCW 82.04) and retail sales tax (RCW 82.08) as applicable. The Parties shall cooperate in determining and satisfying tax obligations.
19. MISCELLANEOUS
19.1 Notices. All notices shall be in writing and deemed delivered (a) when personally delivered, (b) one (1) Business Day after overnight courier with tracking, (c) three (3) Business Days after certified mail, return receipt requested, or (d) when sent by email with confirmed receipt, to:
To Licensor: [________________________________]
Attention: [________________________________]
Email: [________________________________]
To Beneficiary: [________________________________]
Attention: [________________________________]
Email: [________________________________]
To Escrow Agent: [________________________________]
Attention: [________________________________]
Email: [________________________________]
19.2 Assignment. No Party may assign this Agreement without the other Parties' prior written consent, except that (a) Licensor or Beneficiary may assign to an affiliate or in connection with a merger, acquisition, or sale of substantially all assets, provided the assignee assumes all obligations, and (b) Escrow Agent may assign to a qualified successor with thirty (30) days' prior written notice.
19.3 Force Majeure. No Party shall be liable for failure or delay in performance (other than payment) due to a Force Majeure Event. The affected Party shall promptly notify the others, mitigate effects, and resume performance after cessation. If a Force Majeure Event continues for more than ninety (90) days, any Party may terminate upon thirty (30) days' notice.
19.4 Amendments. This Agreement may not be amended except by written instrument signed by all three Parties.
19.5 Counterparts. This Agreement may be executed in counterparts, each an original, all constituting one agreement. Electronic signature shall have the same force as original signature.
19.6 Severability. If any provision is held invalid, the remaining provisions continue in full force. The invalid provision shall be modified to the minimum extent necessary to preserve the Parties' intent.
19.7 Waiver. Failure to enforce any provision shall not constitute waiver. Any waiver must be in writing.
19.8 Entire Agreement. This Agreement, together with the Master Agreement and Schedules, constitutes the entire agreement regarding its subject matter and supersedes all prior agreements.
19.9 Order of Precedence. In case of conflict, this Agreement controls for escrow matters; the Master Agreement controls for all other matters.
19.10 Third-Party Beneficiaries. This Agreement is for the sole benefit of the Parties and their permitted successors and assigns.
19.11 Relationship of Parties. The Parties are independent contractors. Nothing creates a partnership, joint venture, agency, or employment relationship.
19.12 Construction. This Agreement shall be construed without regard to any presumption against the drafter. Headings are for convenience only.
20. SIGNATURES
IN WITNESS WHEREOF, the Parties have executed this Source Code Escrow Agreement as of the Effective Date.
LICENSOR:
[________________________________]
By: [________________________________]
Name: [________________________________]
Title: [________________________________]
Date: [__/__/____]
BENEFICIARY:
[________________________________]
By: [________________________________]
Name: [________________________________]
Title: [________________________________]
Date: [__/__/____]
ESCROW AGENT:
[________________________________]
By: [________________________________]
Name: [________________________________]
Title: [________________________________]
Date: [__/__/____]
21. SCHEDULES
SCHEDULE 1: FEE SCHEDULE
| Fee Category | Amount | Payable By | Frequency |
|---|---|---|---|
| Escrow Establishment Fee | $[________________________________] | [________________________________] | One-time |
| Annual Storage Fee | $[________________________________] | [________________________________] | Annual |
| Update Processing Fee | $[________________________________] | [________________________________] | Per deposit |
| Level 1 Verification Fee | $[________________________________] | Requesting Party | Per verification |
| Level 2 Verification Fee | $[________________________________] | Requesting Party | Per verification |
| Level 3 Verification Fee | $[________________________________] | Requesting Party | Per verification |
| Release Processing Fee | $[________________________________] | Beneficiary | Per release |
| Late Payment Interest Rate | Lesser of 1.5%/month or max rate per RCW 19.52.020 | Delinquent Party | As applicable |
SCHEDULE 2: DEPOSIT MATERIALS INVENTORY
| Item No. | Description | File Name/Path | File Size | SHA-256 Hash | Date Deposited |
|---|---|---|---|---|---|
| 1 | [________________________________] | [________________________________] | [____] | [________________________________] | [__/__/____] |
| 2 | [________________________________] | [________________________________] | [____] | [________________________________] | [__/__/____] |
| 3 | [________________________________] | [________________________________] | [____] | [________________________________] | [__/__/____] |
Attach additional pages as necessary.
Licensor Certification: I certify that the above inventory is complete and accurate and that the listed materials constitute the complete Deposit Materials as described in Section 3 of this Agreement.
Signature: [________________________________] Date: [__/__/____]
SCHEDULE 3: VERIFICATION LEVELS AND PROCEDURES
Level 1 -- Inventory Verification
- ☐ Compare deposit contents against the Deposit Materials Inventory
- ☐ Verify all listed files and directories are present
- ☐ Confirm file sizes match inventory records
- ☐ Validate SHA-256 hash values for each file
- ☐ Prepare and deliver written Verification report
- Timeline: Ten (10) Business Days from request
Level 2 -- Compilation and Build Verification
- ☐ Complete all Level 1 procedures
- ☐ Set up build environment per specifications in Deposit Materials
- ☐ Attempt to compile Source Code into Object Code
- ☐ Document all build errors, warnings, and dependencies
- ☐ Verify that compiled Object Code matches deposited Object Code
- ☐ Prepare and deliver written Verification report
- Timeline: Thirty (30) Business Days from request
Level 3 -- Full Functional Verification
- ☐ Complete all Level 1 and Level 2 procedures
- ☐ Install and configure compiled Product in a test environment
- ☐ Execute all automated test suites included in Deposit Materials
- ☐ Verify that the Product functions in accordance with Documentation
- ☐ Document all test results, failures, and deviations
- ☐ Prepare and deliver comprehensive written Verification report
- Timeline: Sixty (60) Business Days from request
SCHEDULE 4: RELEASE REQUEST FORM AND OBJECTION PROCEDURE
RELEASE REQUEST FORM
Date: [__/__/____]
To: [________________________________] (Escrow Agent)
From: [________________________________] (Beneficiary)
Re: Release Request under Source Code Escrow Agreement dated [__/__/____]
The undersigned Beneficiary hereby requests the release of the Deposit Materials held pursuant to the above-referenced Agreement.
Release Event(s) Relied Upon (check all that apply):
- ☐ Section 6.1(a) -- Insolvency or Bankruptcy
- ☐ Section 6.1(b) -- Cessation of Product Support
- ☐ Section 6.1(c) -- Material Breach of Maintenance Obligations
- ☐ Section 6.1(d) -- Extended Service Outage
- ☐ Section 6.1(e) -- Failure to Deposit or Update
Description of Release Event(s):
[________________________________]
[________________________________]
[________________________________]
Supporting Documentation Attached:
- ☐ Copies of written notices delivered to Licensor
- ☐ Proof of delivery of such notices
- ☐ Evidence supporting the occurrence of the Release Event(s)
- ☐ Other: [________________________________]
Declaration:
I, [________________________________], hereby declare under penalty of perjury under the laws of the State of Washington (RCW 9A.72.085) that the foregoing is true and correct and that one or more Release Events as described above have occurred.
Signature: [________________________________]
Name: [________________________________]
Title: [________________________________]
Date: [__/__/____]
OBJECTION PROCEDURE
- Escrow Agent shall deliver the Release Request to Licensor within two (2) Business Days of receipt.
- Licensor shall have [____] Business Days from receipt to deliver a written objection.
- If no timely objection is received, Escrow Agent shall release the Deposit Materials within five (5) Business Days.
- If a timely objection is received, the dispute shall be resolved pursuant to Section 17.
- Escrow Agent shall act only in accordance with (a) written agreement of both Parties, (b) a final court order, or (c) a final arbitration award.
End of Source Code Escrow Agreement -- Washington
Do more with Ezel
This free template is just the beginning. See how Ezel helps legal teams draft, research, and collaborate faster.
AI that drafts while you watch
Tell the AI what you need and watch your document transform in real-time. No more copy-pasting between tools or manually formatting changes.
- Natural language commands: "Add a force majeure clause"
- Context-aware suggestions based on document type
- Real-time streaming shows edits as they happen
- Milestone tracking and version comparison
Research and draft in one conversation
Ask questions, attach documents, and get answers grounded in case law. Link chats to matters so the AI remembers your context.
- Pull statutes, case law, and secondary sources
- Attach and analyze contracts mid-conversation
- Link chats to matters for automatic context
- Your data never trains AI models
Search like you think
Describe your legal question in plain English. Filter by jurisdiction, date, and court level. Read full opinions without leaving Ezel.
- All 50 states plus federal courts
- Natural language queries - no boolean syntax
- Citation analysis and network exploration
- Copy quotes with automatic citation generation
Ready to transform your legal workflow?
Join legal teams using Ezel to draft documents, research case law, and organize matters — all in one workspace.