4. Force Majeure

Most vendor drafted agreements include what is known as a "force majeure" clause. This clause was originally designed to excuse parties of their contractual obligations in the event of certain acts of god such as fire, earthquake, or civil disturbance. Over the years, however, vendors have expanded the meaning of "force majeure" well beyond its intended purpose to include such events as interruption of communication service, employee relation difficulties, and any act "beyond the Licensor's control." This is not an acceptable allocation of risk, especially when the software and services being provided by the vendor are critical to the licensee's business operations. If the vendor demands some type of protection, the force majeure provision should be limited to true acts of God and an extended delay should trigger a termination right for the licensee. In addition, if the licensee has any obligations with regard to implementation of the software, the provision should be made applicable to both parties.

Example Revision:

Force Majeure. Vendor shall not be responsible for failures of its obligations under this Agreement to the extent that such failure is due to causes beyond Vendor's control including, but not limited to, acts of God, war, acts of any government or agency thereof, fire, explosions, epidemics, and quarantine restrictions, ~~strikes, delivery services, telecommunication providers, strikes, labor difficulties, lockouts, embargoes, severe weather conditions, delay in transportation, or delay of suppliers or subcontractors~~. If the suspension of Vendor's performance continues for more than fourteen (14) days, Customer may terminate this Agreement effective immediately.