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Typical Licensing Agreement

10. Legal generalities. “Standards” (but still important) contractual clauses, including the right to “power” (the law applicable to the licensing agreement); The rights of the IP owner and the taker to the assignment of the licence agreement; events that constitute a “change of control” of a party (for example. B a sale or bankruptcy) and the consequences of a change of control; and the separation of contractual clauses. In the industry, licences are generally granted by a company that wishes to grant rights to another company for payment. As a general rule, these rights are to make, sell or use what your business owns. 3. Duration and termination. The duration of the licence, the reasons why the parties may terminate the licence and the rights and obligations of the parties in the event of termination or expiry of the licence. In many cases, it will be important to require the licensee to immediately terminate the IP rights and, in the event of termination or expiry of the contract, remove all references to the IP address of all its materials in order to best protect the ip owner`s property. However, the nature and extent of the licensee`s obligations in this area may vary depending on the type of investigation, the nature of the industry in which the policyholder operates and the reason for termination (e.g. B termination due to expiry). Payments.

As noted above, the taker generally pays royalties to the licensee. There may be a first advance on royalties, then the continuous royalties are based on sales. Royalties can be paid on the basis of a percentage of turnover or a package. Think of the most appropriate method for both parties (and don`t forget inflation and exchange rates). As a licensee, you are expected to present the legal agreement ensuring that both parties are fully aware of their respective rights and obligations and beyond simply setting royalties. Good legal advice is usually required to negotiate things like: beginning and end of the agreement. Say when the agreement will be reached and when it will end. Describe the possibility of a renegotiation and continuation of the agreement at the end of the agreement.

Please consider the circumstances under which the agreement may expire before the expiry of the term. What happens to the possession of the product at the end (usually it is converted into owner)? You invented something, he received a positive evaluation and filed a patent. Or maybe your company doesn`t have the capital or know-how to manufacture and market its product in a global market. Inventors often prefer to license their technology rather than try to manufacture and market them themselves. Similarly, licensing may be the only practical way for a company to maximize the potential of its existing products. Christian, Glynna K. “Joint-Ventures: Understanding Licensing Issues.” The licensing newspaper. October 2005. Do your due diligence before the agreement.

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