UNITED STATES DEPARTMENT OF AGRICULTURE

Rural Electrification Administration

**BULLETIN 1753E-002**

**SUBJECT:** **[REA Telecommunications Software License
Agreement]{.underline}**

**TO:** All Telephone Borrowers

REA Telephone Staff

**EFFECTIVE DATE:** May 16, 1994

**EXPIRATION DATE:** Date of change of 7 CFR part 1753.38,

paragraph (c) by rulemaking

**OFFICE OF PRIMARY INTEREST:** Central Office Equipment Branch,
Telecommunications Standards Division

**FILING INSTRUCTIONS:** File with 7 CFR 1753 and on REANET.

**PURPOSE:** This bulletin provides a user-friendly reformatting of the
uniform Telecommunications Software License Agreement required by REA
and codified at 7 CFR §1753.38 (c), as published on April 14, 1994, at
59 FR 17675. This bulletin simply sets out the codified contract
addendum in a detachable usable format.

Every effort has been made to ensure the accuracy of this document.
However, in case of discrepancies, the regulation at

7 CFR §1753.38 (c) is the authorized source.

Wally Beyer 4/26/94

\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

Administrator Date

**TABLE OF CONTENTS**

1\. General

2\. Instructions for Use

Addendum (Software License Agreement)

INDEX:

Software License Agreement

**ABBREVIATIONS and ACRONYMS**

REA Rural Electrification Administration

**1. GENERAL**

The uniform Telecommunications Software License contained in this
bulletin is a detachable, usable reformatting of the contract addendum
codified at 7 CFR §1753.38 (c). This addendum is to be used with any REA
financed central office equipment contract (REA Form 525 or 545) when
the borrower is required to execute a Software License Agreement. This
addendum provides a single Telecommunications Software License Agreement
rather than using the varying individual agreements provided by
suppliers. Standardizing the agreement reduces the review and approval
time of equipment contracts and ensures fair and equal treatment for all
providers of central office equipment.

**2. INSTRUCTIONS FOR USE**

Remove the attached Addendum and use it with any REA financed central
office equipment contract (REA Form 525 or REA Form 545) where the
Borrower is required to execute a Software License Agreement.

**Addendum to REA Form 525, Central Office Equipment Contract (Including
Installation) and REA Form 545 Central Office Equipment Contract (Not
Including Installation)**

**Software License Agreement**

\(1\) **[Definitions]{.underline}**. For the purpose of this Software
License Agreement \--

*[Contract]{.underline}* means the REA Form 525 Central Office Equipment
Contract (Including Installation) or REA Form 545 Central Office
Equipment Contract (Not Including Installation),

dated
\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_,
between

\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_(the
Licensee) and

\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_(the
Licensor).

*[Days]{.underline}* means calendar days.

*[Licensed Software]{.underline}* means the computer programs, furnished
for the operation of the System(s) provided under the Contract, whether
contained on a tape, disc, semiconductor device, or other memory device
or system memory consisting of logic instructions and instruction
sequences in machine-readable object code, which manipulate data in the
central processor, control and perform input/output operations, perform
error diagnostic and recovery routines, control call processing, and
perform peripheral control, administrative and maintenance functions; as
well as Licensor\'s standard customer documentation, excluding source
code, used to describe, maintain and use the programs provided under the
Contract.

*[Licensee and Licensor]{.underline}*, respectively, mean the parties
signing the software license agreement as the licensee and licensor.

*[Right-to-Use Fee]{.underline}* is defined in Section (2).

*[Specifications]{.underline}* means the REA Form 522, General
Specification for Digital, Stored Program Controlled Central Office
Equipment, which is part of the Contract.

*[System]{.underline}* means the stored program controlled central
office and associated remote switching terminal or terminals which use
the Licensed Software covered by this License.

\(2\) **[Software License Provisions]{.underline}**. The Licensor may
charge a fee, herein referred to as a Right-to-Use Fee, for use of the
Licensed Software. The Right-to-Use Fee shall be included in the Total
Base Bid as defined in the Contract. In consideration of the
Right-to-Use Fee, the Licensor hereby grants the Licensee the right to
use all Licensed Software, solely in connection with the System provided
under this Contract, so that the System performs in accordance with the
Contract and the Specifications.

\(i\) The Licensee\'s right to use the Licensed Software is
non-exclusive and limited to use or operation in the United States of
America, including its Territories, the Federated States of Micronesia,
the Marshall Islands, Palau and the Commonwealth of Puerto Rico, with
the System for which the Licensed Software is provided by the Licensor.
The Licensee may reuse the equipment and its accompanying Licensed
Software at another location within the Licensee\'s System without
obtaining additional approvals from Licensor, provided, however, that
the Licensee notify the Licensor, within ten (10) days, of the change in
location of the equipment and Licensed Software.

\(ii\) The Licensee and any successor to the Licensee\'s title in the
System may, without further consent of the Licensor, transfer the
Licensed Software and all of the Licensee\'s rights and interests under
this Software License to any transferee who acquires legal title to the
System, provided that such transferee first agrees in writing to the
Licensor to abide by all of the terms and conditions of this License
including, without limitation, the territorial limitation stated in
Section (2)(i) and the restrictions on decompiling or reverse assembly
stated in Section (2)(iii). Licensee shall give Licensor written notice
thirty (30) days prior to any transfer. The Licensor shall not place any
additional conditions on the transferee\'s use of the System or the
Licensed Software. If the provisions of this Section (2)(ii) are
satisfied, thereafter the Licensee shall bear no responsibility for
transferee\'s failure to abide by the terms and conditions of this
License.

\(iii\) The Licensee shall take reasonable steps to protect the
confidentiality of the Licensed Software and shall not decompile or
reverse assemble all or any part of the Licensed Software to generate
source code. The Licensee shall not make the Licensed Software available
to any person except on a need to know basis. The obligations of the
Licensee hereunder shall not extend to any information or data relating
to the Licensed Software which is now available to the general public or
becomes available by reason of the acts of the Licensor or third
parties.

\(iv\) The Licensee may reproduce or copy the Licensed Software and
related materials solely for the purpose of archival backup, in-house
training and operating, maintaining, and administering the System
provided under this Contract. In such reproduction, the Licensee shall
include, upon all such copies of the Licensed Software, all proprietary
notices, including the copyright notice within the Licensed Software
program and related documentation in the form in which it is received
from the Licensor.

\(v\) The Licensee acknowledges that the Licensed Software program is
the property of the Licensor, and shall not do, or cause to be done,
anything to activate any of the subsisting nonactivated computer
instruction steps therein unless authorized in writing by the Licensor.
The Licensor shall have the exclusive right to activate, or authorize
the activation of, the subsisting nonactivated program instruction steps
in the Licensed Software. In this event Licensee shall pay any
additional Right-To-Use Fee(s) agreed to by Licensee and Licensor.

\(vi\) In the event the Licensor develops significant improvements to
the Licensed Software, the Licensor may market the improvements as a
separate offering requiring payment of an additional Right-to-Use Fee.

\(vii\) The Licensee shall not modify or otherwise change the Licensed
Software other than at the direction of the Licensor.

This provision shall not apply to:

\(A\) Changes to the Licensed Software which are necessary to preserve
or restore service. Licensee shall use all reasonable efforts to contact
Licensor before making any such changes. If the Licensor is unable to
make the necessary changes promptly to the Licensed Software to preserve
or restore service, then the Licensee may make only such changes to the
Licensed Software as are necessary to preserve or restore service. In
such event, Licensee shall promptly notify Licensor of the changes made
by Licensee.

\(B\) Changes made by the Licensee to its own database; and

\(C\) Changes made by the Licensee in connection with the exercise of
its rights under Section (2)(xi).

\(viii\) Within thirty (30) days after written notice that a program or
a release thereof has been discontinued and is no longer required for
the operation of the System and the Licensor has furnished the Licensee
with a new program that is fully satisfactory to the Licensee, the
Licensee agrees to return the original and all copies of the
discontinued program and specified related documents. If such return is
impossible or impractical, the Licensee shall destroy said program and
documents and provide the Licensor with a written notice of such
destruction.

\(ix\) The Licensor warrants to the Licensee that any Software licensed
under this Software License shall function for a period of five (5)
years from the warranty start date defined in the Contract in accordance
with the Specifications and any written or printed technical material
provided by the Licensor to explain the operation of the Licensed
Software and aid in its use. The Licensor shall correct all deficiencies
within thirty (30) days from the date of receipt by the Licensor of
written notice of such deficiencies from the Licensee. An extension of
this thirty (30) day period may be allowed only if agreed upon by the
Licensee and REA. It shall be the Licensor\'s obligation to insert and
thoroughly test, at no charge to the Licensee, any software amendment or
alteration provided to satisfy the obligations of this Section (2)(ix).
If a deficiency is detected or a correction made within the final ninety
(90) days of the warranty, the warranty shall be extended to a date
ninety (90) days after the deficiency has been corrected.

\(x\) The Licensor shall hold harmless and indemnify the Licensee from
any and all claims, suits, and proceedings for the infringement of any
patent, copyright, trademark, or violation of trade secrets covering any
Licensed Software used with the System, except for items of the
Licensee\'s design or selection. If the Licensee\'s use of the Licensed
Software is enjoined, the Licensor shall promptly, at its own expense,
place the Licensee in a position where it is able to use the System in
accordance with the Specifications, whether by: (A) modifying the
Licensed Software or portion thereof so that it no longer infringes but
remains functionally equivalent, (B) replacing the Licensed Software
with noninfringing equivalent software, (C) obtaining for the Licensee a
license or other right to use, or (D) such other actions as may be
required. This shall be in addition to any other rights or claims which
the Licensee may have. The Licensor shall, at its own expense, (and the
Licensee agrees to permit the Licensor to do so) defend any suits which
may be instituted by any party against the Licensee for alleged
infringement of patents, copyright, trademark, or violation of trade
secrets relative to the Licensor\'s performance hereunder. Either party
shall notify the other promptly of any such claims, and the Licensee
shall give to the Licensor full authority and opportunity to settle such
claims, and shall reasonably cooperate with the Licensor in obtaining
information relative to such claims.

\(xi\) In the event the Licensor becomes unwilling or unable to furnish
support required by the Contract for the Licensed Software, the Licensor
shall, upon written request of the Licensee, provide with the greatest
possible dispatch all Licensed Software back-up documentation including
proprietary information other than agreed excluded documentation. In
this event, (1) the Licensee shall be permitted full use of all Licensed
Software and documentation as long as the System is operational and (2)
the Licensee may modify, or have modified, the Licensed Software for
feature enhancement or proper equipment operation and becomes the owner
of such modifications for all purposes, including patenting,
copywriting, sale, or license thereof. Agreed excluded documentation is
Licensed Software back-up documentation described in the first sentence
of this Section (2) (xi) which (A) is proprietary information of a third
party, (B) was specifically described at the pre-bid technical session
and individually identified in an attachment to the Bid, and (C) REA and
the Licensee agree, before bids are opened, may be excluded from the
requirements of this Section (2)(xi). In the event the Licensor
furnishes agreed excluded documentation and the Licensee exercises its
rights under this Section (2)(xi), the Licensor shall use its best
efforts to provide such agreed excluded information to the Licensee, or
obtain continuing support agreements from the parties retaining legal
rights to the excluded documentation. Licensor agrees that certain
Licensed Software cannot be excluded from the requirements of this
Section (2)(xi) including, but not limited to, software, the absence or
improper operation of which would significantly impair the operation of
the System, would significantly impair the ability of the Licensee to
generate revenue, or would pose a risk to REA loan security.

\(xii\) A breach of this License by the Licensor is a breach of the
Contract. Therefore, the remedies specified in the Contract shall apply.

\(xiii\) The Licensee shall have thirty (30) days after receipt of
written notice from the Licensor to correct any breach of this License.
Damages payable by the Licensee for its breach of this License shall not
exceed the total Contract price. The Licensor shall not terminate this
License unless:

\(A\) The Licensor has given REA sixty (60) days notice before
termination; and

\(B\) REA agrees with the Licensor that termination is the only method
available to prevent significant harm to the Licensor from additional
Licensee defaults.

\(xiv\) The obligations of Licensee and Licensor and any successors in
title under this Agreement shall survive the termination of this
Agreement and continue after any termination of rights granted
hereunder.

\(xv\) Licensee and Licensor agree that it will not, without the prior
written permission of the other party, use in advertising, publicity,
packaging, labeling, or otherwise, any trade name, trademark, trade
device, service mark, symbol, or any other identification or any
abbreviation, contraction, or simulation thereof owned by the other
party or any of its affiliates or used by the other party or any of its
affiliates to identify any of their products or services, unless
otherwise agreed by the parties.

\(xvi\) This Software License Agreement shall prevail notwithstanding
any conflicting terms or legends which may appear on or in the Licensed
Software.

\(xvii\) If any Section or part thereof, in this Agreement shall be held
to be invalid or unenforceable in any jurisdiction in which this
Agreement is being performed, then the meaning of such Section or part
shall be construed so as to render it enforceable, to the extent
feasible; and if no feasible interpretation would save such Section or
part, it shall be severed from this Agreement and the remainder shall
remain in full force and effect. However, in the event such Section or
part is considered an essential element of this Agreement, the parties
shall promptly negotiate a replacement therefor.

\(xviii\) This Software License and any amendments thereto, or revisions
thereof, are subject to REA approval.

**[LICENSOR]{.underline}** **[LICENSEE]{.underline}**

**Company Name\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ Company
Name\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_**

**By\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
By\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_**

**Title\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
Title\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_**

**Date\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
Date\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_**