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What should I include in my escrow deposit?

February 7, 2013

When creating software escrow agreement we are often asked, “what should be included in the deposit?” This is a very good question and one that causes a great many people much concern. The simple answer is to include everything that the software developer requires to maintain and develop the application.

In reality it is not that simple;

  • should COTS be included?
  • “should we include VM’s?”
  • do we include open source products?
  • what about third part tools, libraries and dlls?

Suddenly there are lots of questions that need to be addressed.

“Deposit materials” are the materials placed into the escrow. For the escrow to be effective, the beneficiary must be sure that the deposit materials are adequate. At a minimum, this means that the software’s source code must be included, the beneficiary will want and need more, however so the deposit materials must include;

  • build instructions
  • programming documentation
  • configuration information

and any other documentation used by the licensor’s programmers to understand the source code or to;

  • develop
  • compile
  • maintain
  • or update the software

Deposit materials should further include;

  • software development tools
  • compilers
  • linkers
  • libraries

and any other resources used by the licensor’s programmers and needed for maintenance or enhancement of the software.

Generally, there is no need to include anything that would be commercially available (COTS) to the beneficiary from other sources if the deposit materials are released, however. For example, a development tool or compiler that can be obtained from a commercial source does not need to be included in the deposit materials but a list or document identifying the particular development tool or compiler, including version, should be included, though, so that the beneficiary will know what to use.

As standard for all deposits that are placed into escrow there should be a basic level of verification performed to verify the deposited material can be build and tested as expected by the licensee.

The only way to be sure that the material deposited meets your needs and can be built into a working application should a critical event occur is to use verification testing.

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written by David Clee

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