EscrowTech India

EscrowTech India was established in April 2005 with the primary objective of providing software and technology escrow services to Indian Companies.

This service was previously not avilable in India and a few Tier One Indian Comapanies used the services of Escrow service providers abroad, but all that has changed since the formation of EscrowTech India. EscrowTech India is a intergral part of the EscrowTech International Inc. USA family. EscrowTech USA has been one of the world's premier escrow service providers for more than a deceade.

EscrowTech India brings to the subcontinent with it the expertize and the experience of EscrowTech USA, however with subtle changes to benefit the domestic Software and Technology escrow market.

What are the advantages EscrowTech India offers its Indian clients ? This we will deal with in detail in our next article on this blog.

EscrowTech India was established in April 2005 with the primary objective of providing software and technology escrow services to Indian Companies.

This service was previously not avilable in India and a few Tier One Indian Comapanies used the services of Escrow service providers abroad, but all that has changed since the formation of EscrowTech India. EscrowTech India is a intergral part of the EscrowTech International Inc. USA family. EscrowTech USA has been one of the world's premier escrow service providers for more than a deceade.

EscrowTech India bring to the subcontinent with it the expertize and the experience of EscrowTech USA, however with subtle changes to benefit the domestic escrow market.

What are the advantages EscrowTech India offers its Indian clients ? This we will deal with in detail in our next article on this blog.

Software & Technology Escrows

Definitions of an escrow:

Escrow is a legal arrangement whereby a thing (often money, but sometimes other property such as art, a deed of title, or software source code) is delivered to a third party (called an escrow agent) to be held in trust and safe custody, pending a contingency or the fulfillment of a condition or conditions in a contract. Upon that event occurring, the escrow agent will deliver the thing to the proper recipient; otherwise the escrow agent is bound by her or his fiduciary duty to maintain the escrow account.

A written agreement between two or more parties providing that certain instruments or property be placed with a third party in safe custody to be delivered to a designated person upon the fulfillment or performance of some act or condition.

Software / Source Code Escrow:

These are two definitions of an escrow and the same applies to Software & Technology Escrows. In case of software escrows the source code is the subject matter otherwise called the Escrow Property or & Deposit Materials to be escrowed. The subject matter is the source code, the only variant being the terminology used by different escrow agents.

Technology Escrow:

Technology escrow functions similar to software escrow except that subject matter to be deposited in an escrow could be Technological drawings, formulas etc. Companies could use a technology escrow for anything from Heart Valve Prototypes to Chemical Reactor Drawings.

Escrows are popular and very widely used by licensees in the west especially in USA, U.K and Europe. In India the concept of escrows is yet to sink in, one crucial reason was the absence of an escrow service provider, however even that void has been filled with the emergence of EscrowTech India.

EscrowTech India is an Indo-US joint venture company with EscrowTech International Inc. USA, one of the world most trusted software escrow agents.

For information on software & technology escrows log onto www.escrowtech.in or mail info@escrowtech.in

The source code escrow does indeed offer a significant amount of protection for software
licensees against vendor bankruptcy. As noted prior, because of the gaps left open in the Code, the amendments fall short of providing a software licensee with adequate protection. However, the escrow does not in and of itself provide an adequate level of protection sought by licensees. Nevertheless, this practice can be an extremely effective source of protection for licensees when used in conjunction with a meticulously drafted licensing and escrow agreement. There are certain points a licensee should be sure to include in its licensing and escrow agreements to maximize the protection of the escrow.

First, the licensee should negotiate a clause that gives the licensee the right to decide
when an event triggering release has occurred. In addition, the licensee should include terms in the escrow agreement that clearly spell out which events are “triggering events” for release of the source code.

As Attorneys who draft agreements, contracts between business houses on a very regular basis in the current economic environment, all necessary care and attention is paid to the minutest of details in every agreement / contract. A software license agreement is one such contract wherein software is licensed and the licensor and a licensee are parties to the contract. The nature of the software license agreement is different from other agreements.

The fact of the truth is that all agreements drafted today have their deficiencies, and these shortcomings come to light only when a party to the contract breaches it and there are legal implications to it. In the case of the software license agreement, a software product is licensed to the licensee, but the licensee does not own the product and still has to depend on the licensor for future, maintenance, development, and enhancement of the said software. With this in mind to give such licensees a time bound solution to their problems, Software Source Code Escrow was born.

A Software Source Code Escrow is a case wherein a neutral third party holds in physical possession, protects and secures the source code for the benefit of the licensee in case of a future contingency. A software agreement until the emergence of software escrows was biased towards the licensor. Now the scales are in balance with the coming of software escrows. It has been proved over the years that software escrow is realistically operative and provides a watertight solution in case of a future contingency.

As attorneys to a software licensee agreement on either side, software escrows should be a pertinent part of a software licensee agreement. An Attorney of the licensor would not be to keen on having a software escrow in place. With the escrow concept gaining popularity the globe over one day it may become statutory that a software escrow be drafted parallel to a software license agreement. The software escrow from the point of the licensor increases several fold the confidence of potential clients of the company. It also sends out a very positive message to the market in general. A software escrow from the point of the licensee is very crucial to protect his interests in the agreement.

You need more information about software escrows, log onto our website at www.escrowtech.in or mail us at info@escrowtech.in and we will provide you with all the information you ever need.

As an independent, neutral escrow agent, EscrowTech India provides escrow management services and the best physical protection of the source code at our state-of-the-art, maximum-security storage facilities. Our escrow agreement is simple, straightforward and easy to understand, significantly reducing your legal expenses. The source code is only released to licensed users under specific terms of the agreement.

Source code escrow offers more than just security and protection. A source code escrow enhances your product with many value-added benefits, all of which have the potential to translate into profits for your software business.

A source code escrow provides a cost-effective solution to your customer's basic concern: How will the software be supported if you go out of business? By escrowing the source code in advance, you can anticipate and answer a licensee's need for long-term software support and maintenance. Source code escrow will give you the edge on your competition by winning the trust and confidence of the customer.

How Source Code Escrow Benefits the Developer

• Establishes clear ownership

• Demonstrates efforts to protect the trade secrets that make your intellectual property valuable (You must take steps to guard your trade secrets before a court will consider them your confidential property.)

• Protects against fraudulent claims by employees or competitors

• Helps increase sales by providing a cost-effective solution to your customers' need for assurance of program maintenance

• Can be used as collateral for financing from banks or investors

How Source Code Escrow Benefits the User

• Protects your investment in technology

• Ensures the transfer of proprietary information to you should the developer declare bankruptcy

• The source code will remain updated and intact

• Ensures long-term maintenance of licensed software

• Easy to enroll as a licensee