Section 3.1 establishes standard payment terms (due within 30 days) but marks all Fees as 'non-cancellable and non-pro-ratable for partial months or years, and non-refundable' with exceptions only as expressly stated. This is a strict, non-consumer-friendly policy. Section 10.1 establishes automatic renewal with price increases equal to the Index plus 3 percent, with a 3-month notice requirement to prevent renewal (reasonable). Late payment interest is capped at 1.5% monthly or statutory maximum (Section 3.3), which is reasonable. No explicit cancellation fees or excess usage penalties are mentioned beyond those in the Order Form.
Section 6 provides comprehensive disclaimers, stating Services are provided 'as is' with no warranties regarding accuracy, reliability, security, or freedom from interruption. These disclaimers are broad but appropriate for an AI platform where outputs cannot be guaranteed. Section 8 (English/New York law) caps liability at Fees paid in the Contract Year and excludes consequential damages, lost profits, and data loss. Critically, Section 8.2 preserves 'any liability that cannot be excluded or restricted under applicable law,' protecting non-waivable rights. Section 9 (German law) is more balanced, allowing liability for gross negligence and essential contractual duties with a reasonable damages cap.
The agreement clearly allocates IP ownership in a customer-friendly way (Section 4.1): deepset retains Services and Background IP, while Customer retains AI Applications and Bespoke Configurations. Section 4.2 goes further by assigning all Bespoke Configurations to Customer and granting a perpetual, non-exclusive license to Foreground IP for use in AI Applications. Critically, Section 4.5 restricts deepset's use of Customer Data to only two purposes: providing Services and creating System Data (defined as anonymized/aggregated). The feedback clause (Section 4.3) is standard and does not claim ownership of user suggestions.
The agreement defines Authorized Users (Section 2.10) and establishes Customer responsibility for account security. Termination provisions in Section 10.2 are fairly balanced for B2B: deepset may terminate for convenience with 6 months notice, or either party may terminate for material breach with a 30-day cure period. However, the document lacks an explicit appeal process for disputed suspensions and does not specify data export procedures. Suspension rules (Section 2.13) provide reasonable 30-day advance notice for payment-based suspension.
Section 11.4 requires that 'no amendment or modification...will be effective unless agreed to in writing by both parties,' providing strong protection against unilateral changes. Section 2.12 allows deepset to modify Services 'in its sole discretion' only if such modifications do not have 'materially adverse impact on functionality, performance or security.' Section 10.1 establishes clear auto-renewal price adjustment formula (Index plus 3 percent) with 3-month notice requirement. The document avoids aggressive patterns like 'effective immediately upon posting' or 'continued use constitutes acceptance.' No evidence of retroactive changes or silent updates.
The Services scope is clearly defined as creation of AI Applications using either cloud or self-hosted Haystack. Section 2.1 and 11.11 establish that Order Forms are incorporated into the agreement and constitute the entire contract. The language is well-organized with comprehensive definitions (Section 1), and the document avoids confusing jargon. No unusual procedural unconscionability issues arise from the acceptance mechanism, which relies on mutual Order Form execution.
Section 2.3 requires deepset to maintain security 'materially in accordance with industry standards' and restrict personnel access except for service provision, legal compliance, or Customer permission. However, the T&C itself provides limited privacy detail compared to comprehensive privacy law requirements. No specific breach notification timeline, data retention period, or third-party sharing restrictions are stated in this document. This is typical for B2B agreements that reference a separate Privacy Policy, but the sparseness means consumers must review that separate document.
Section 7 establishes balanced, mutual indemnification with clear scope limits. Section 7.1 requires deepset to indemnify Customer for third-party IP infringement claims arising from use per the T&C. Section 7.2 limits Customer's indemnity obligation to 'Excluded Claims' (defined in Section 7.1 as IP infringement caused by Customer designs, Customer modifications, Customer Data, use with other products, or continued use after notice). Critically, Customer indemnity does NOT trigger from mere use of the Service and does NOT cover deepset's own negligence. Section 7.3 gives the indemnifying party control of defense, subject to consent-to-settle requirements. This avoids predatory 'infinite indemnity' patterns.
Section 11.8 and 11.9 establish geographically appropriate governing law: German law and Berlin courts for EEA customers, English law and London courts for UK customers, and New York law and New York courts for others. Critically, the document does NOT impose mandatory pre-dispute arbitration, does NOT include a class action waiver, and does NOT strip jury trial rights for arbitration purposes (jury waiver applies only to court litigation). No shortened statute of limitations is imposed. Section 11.2 includes standard export compliance language without unreasonably shifting compliance burden to customers. This design preserves meaningful consumer access to justice.