Just because an individual purchases software under their name does not mean there are no sanctions for the misuse of the program. Chances are, individuals are familiar with an end-user license agreement. However, not many people read through them, even if they contain essential statements and provisions. It’s necessary to be aware of an end-user license agreement as various stipulations must be considered. Learn about the end-user license agreement, including its definition, components, and construction, by understanding the following article.

35+ Sample End User License Agreement 

What Is an End-User License Agreement?

An end-user license agreement (EULA) is considered a legal contract between software developers and the software user through a purchase made by a user to a retailer of a given product. The EULA details the rights and restrictions that pertain to handling software, similar to a term of services agreement. Software companies utilize the use of these agreements as a means to protect themselves by requiring users into the company’s terms, rules, and guidelines. The EULA is present with any developed software application regardless of the platform intended for use, whether on computers, cellular phones, or game consoles. An end-user license agreement is also known as a software license agreement. Most of these contracts are present in digital form and are visible as a click-through that allows the users to agree or disagree.

According to an article published through businessinsider.com in November 2017, a hosted survey by Deloitte shows that 91 percent of American consumers accept legal terms and conditions of an agreement without reading them, and participants aged 18 to 34 years old produce a rate of 97 percent.

Components of an End-User License Agreement

While the elements of an end-user license agreement vary depending on the product, the EULA must contain the following general components:

Disclaimer of warranties: It informs the licensee that the software is delivered without changes and is genuine. The licensor also does not hold responsibility for any problems or complications from its use.Governing laws: Identifies the state laws that cover applied to the agreement if and when conflicts arise.Infringement acknowledgment: The statement acknowledges and assigns responsibility for violation of conflicting copyright law to the licensee.Licensor: This section of the EULA must identify the name, address, and other contact information relating to the entity involved in the product development.Licensee: The EULA states the name, address, and other relevant information for the user’s request to access and use the software.License granting: License granting states any limitations on the permissions granted by the licensor to the user.Limitations of liability: Identifies whether the licensor is responsible for any damages relating to the use of the software or product.Maintenance and support: The section declares if the support and maintenance are available for the application and the platform. It also offers the possibility for delivery over the phone, through email, or in person. Software: The end-user license agreement must clearly state the program’s title or software under the license.Termination: It must contain and specify a list of license violations to give the software creator the right for an agreement termination.Use restrictions: It identifies the legal limitations of the end-user while availing and using the application or program.Start date: It identifies the period when the end-user becomes bound to the terms and conditions of the agreement. It can be through the opening of a package or upon download of the program.Site licenses: It states if the program is accessible to multiple devices under the EULA’s terms.

Relevant Clauses of an End-User License Agreement

There are vital clauses that must be present in all end-user license agreements. These statements address the permission of use, infringement clauses, restrictions, terminations, and other limitations and disclaimers regarding the license usage. Listed below are the essential descriptions in end-user license agreements:

License granting clause: One of the primary purposes of a EULA is to allow consumers the right to access and use a particular program or application. That is why each end-user licensing agreement includes a clause specifically for the permission granted to users by the software owner.User restriction clause: There is no saying what a consumer can and will do once they can access the software. A user can utilize the application variously, even in illicit manners. It is ideal for the agreement to contain a section that specifies user restrictions when using the program. A EULA contains limitations relating to copying the license on multiple devices, using it to practice unlawful activities, or manufacturing the software for prohibited reproduction. The licensing agreement must contain this clause to prevent and limit unnecessary actions of consumers using your company’s software application.Related agreements: It is safe to include a clause stating that the end-user agrees to similar provisions and terms of the licensing agreement, such as the privacy policy or terms and conditions. If there are other agreements found in the EULA that identifies restrictions and limitation on the usage of the application, consider including the links to the documents near the license agreement information. Another way to incorporate the essential links is to place them on the bottom or last part of the EULA and provide ease of access to the consumer.Copyright infringement clause: Infringement disputes are inevitable when it comes to software. It is, for this reason, that including a section that states the possible liabilities and consequences to users that commit copyright infringements. As much as possible, make the statement brief and incorporate specific language that adds clarity to the user. Clarify to the buyer that if copyright infringement happens, it is their responsibility to be liable for the legal issues that follow.Licensing termination clause: If violation of restrictions and other issues within the agreement happen, the software owner reserves the right to terminate the use of the license. The termination of licensing clause is essential to an end-user licensing agreement and grants solid rights to the licensor of the application rather than the program’s consumer.Warranty disclaimer clause: A warranty disclaimer is necessary and one of the main clauses present in a EULA. It states that the application is available as it is, taking away the responsibility of the developer or owner to make changes or modifications to satisfy the standards, needs, and desires of its consumers.Limitations of liability clause: The licensor states that they are not responsible for any damages concerning the application’s usage. A EULA must hold this clause to protect the licensor or provider from potential liability when problems arise. An example of this is when a user downloads a program or application, resulting in their device malfunctioning. The owner of the equipment cannot pursue the distributor for repair or replacement of the unit, even if the app or program, did in fact, cause the malfunction.

How to Write an End-User License Agreement

As the EULA protects the software creator and the licensor, the company must provide a well-written and curated document. After having an idea of what a EULA contains, it’s time to create one for your company. Here are helpful steps to follow in writing an end-user license agreement for the company or yourself.

Step 1: Identify Yourself or Your Business Clearly

EULAs must begin with a simple introduction. It must introduce details, including the name of the application or program, the company name, and all other names and affiliates under the scope of the conditions of the agreement. A definition of terms is present, with references to any additional terms in the span of the document. It is necessary to include that the document is a legal arrangement between the user and the software company. Ensure that users understand the introduction by indicating they agree and accept your agreement.

Step 2: State the Rules for User Behavior and Access to the Product

Continue writing your EULA with the use and restriction of the license, letting the user know they can use your product and the extent they can make use of it. It is also advisable to stress that the user only has access to the license, and you did not sell your program. Restrictions regarding the use of the program must cover all the principles of the activities you wish to limit. The section details usual restrictions on use, including spam, illegal manufacturing, profiting, copying portions of the software, and violating laws using the software. You also have the freedom to structure your clauses in a way that is clear to your consumers, whether it is by using sub-categories or sub-headings.

Always incorporate a section that informs your end-users that your products or materials are under the protection of copyright laws. Include necessary items to be covered, from the software to relating documents.

Step 4: List Other Details of Software Licensing and Conditions of Termination

It is wise to create a termination of use clause. It states that when a user violates any conditions specified in the end-user license agreement or any relating agreements you have and wish to include, or through your discretion, you have the right to terminate and remove the program from the user’s device.

Step 5: Include Disclaimers and Limitation of Liability Statements

Indicating a warranty disclaimer helps make it clear to your users that the software comes as it is and that you do not guarantee anything beyond the minimum requirement by law. It is also ideal to use easily understandable language. Use a limitation of liability clause to let your users know that you are not liable for any damages that may arise when using your program, as well as the damage to the device they are using. Write a section that acknowledges the application of limitations at the greatest enforceable extent under applicable laws covering the license agreement.

FAQs

What is the similarity of a EULA to terms of use or terms of service agreement?

By definition, the terms of use agreement, similarly called terms and conditions or terms of service, dictates the relationship between an entity, its product or service, and the consumer. It includes everything from copyright and licensing to consumer rights, return policies, and even the governing laws of the agreement. The EULA operates the same way, but the focus centers on the licensing relationship between the developer and the user. These titles are often interchangeable and concern products like software, applications, and programs.

Are there disadvantages to a EULA?

EULAs are often lengthy, hard to decipher, and brimming with legal jargon that most people completely ignore its context before agreeing to its terms. However, not thoroughly reading the content leading to impactful consequences, leading to computer viruses, phishing scams, identity theft, and other technical issues.

Why is a EULA necessary, and what benefits does it bring to your company?

The EULA provides a legal way for the licensee to buy or rent the use of a product with specific limitations. As the company that developed the program earns money from its use or rent, they also control its parameters. Through it, the licensor prevents users from making illegal changes to the product or copying it for unauthorized distribution. It establishes your property rights to the software, protecting the company’s intellectual property. It also safeguards you and the company from any impending lawsuits on the basis that terms were not read. It also clarifies the exemption of the developer from responsibility when devices malfunction under the limitation of liability.

What are the consequences of not using a EULA?

Without the perimeters set by a EULA, a software creator instantly agrees to a free and open-source software license. In this type of situation, the future versions of the software must remain unrestricted for distribution. The EULA protects the source code and written program, mobile application, software, and computer program from being reproduced without permission. Without it, users who obtain the product can modify, adapt, improve, enhance, translate, or derive works from the original software.

Where do you commonly see the use of EULA?

If your company handles internet websites, mobile applications, software applications, and computer programs, you benefit from creating a license agreement for your consumers before giving them access to your product.

Companies issue agreements for various reasons. Mainly, these legal documents protect their intellectual properties and limit their liabilities. Organizations must utilize these papers, especially when it comes to their merchandise and services. End-user license agreements are helpful to companies handling technological products like websites, mobile and software applications, and computer programs. To software developers, their intellectual creativity is their treasure and must be well protected, especially when competitors try to succeed over others. In the words of Steve Jobs, “Creativity is just connecting things. When you ask creative people how they did something, they feel a little guilty because they didn’t really do it, they just saw something. It seemed obvious to them after a while.” Protect your business by implementing an end-user licensing agreement through the use and download of the samples above.