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Application Service Provider (ASP) Agreement (Customer)


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Many businesses make use of specialised software. The costs of such software can be extremely high – too high for many small and medium businesses. This is where ASPs (Application Service Providers) step in. ASPs provide access to software to their customers over a network. This significantly reduces both the cost and complexity burden on businesses, enabling those with limited resources to access specialised software which would otherwise be out of their reach.

The ASP owns both the software and the equipment on which the software is hosted. This reduces the burden on the end users of the software in that maintenance obligations and the costs associated therewith are borne by the ASP. As a result, the customer does not have to be concerned with fluctuating and unpredictable costs; rather their IT costs will amount to little more than a simple, known monthly fee. Moreover, software and supporting infrastructure will be regularly updated.

This ASP Agreement (Customer) has been written with such services in mind and is designed for use by ASPs to govern the provision of their services to a wide variety of customers.

The terms of this agreement are designed to favour the customer. This version of the agreement adds protective measures for the customer: the ASP is required to indemnify the customer if the customer suffers loss as a result of a breach of the agreement by the ASP. Further, the customer has the right to terminate the agreement early if fees are increased to a level they consider unreasonable (subject to the payment of a termination fee).

An ASP-oriented version of this document is also available. Furthermore, under this agreement, training is the responsibility of the customer. Two alternative versions, each providing for the provision of training by the ASP are also available.

Optional phrases / clauses are enclosed in square brackets. These should be read carefully and selected so as to be compatible with one another. Unused options should be removed from the document.

This ASP Agreement (Customer) contains the following clauses:

1. Definitions and Interpretation 
2. The Service 
3. Term 
4. Fees and Payment 
5. The Applications 
6. Training 
7. Security 
8. Maintenance 
9. Software Licenses 
10. Applications and ASP Infrastructure Terms of Use 
11. Customer Computer Systems 
12. Support 
13. Intellectual Property 
14. Customer Data 
15. Confidentiality 
16. Liability 
17. Indemnity 
18. Force Majeure 
19. Termination 
20. Notices 
21. Relationship of Parties 
22. Assignment 
23. Severance 
24. Entire Agreement 
25. No Waiver 
26. Non-Exclusivity 
27. [Dispute Resolution (Arbitration)] 
28. Law and Jurisdiction

And the following schedules:

1. Fees 
2. Applications 
3. Third Party Software Licenses 
4. [Reasonable Usage Policy]

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