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What Should Be Included in a Licensing Agreement

The End User License Agreement (EULA) is one of the most important documents for a software developer. This Agreement gives the User the opportunity to use the Product. In return, the User agrees to comply with all the restrictions set out in the EULA. This section presents and explains the different elements of the checklist for licensors and licensees. If your work requires you to design license agreements, download the checklist from the online version of this guide, where it is provided without annotations. This instrument is the entire agreement between parties______ A license agreement is a written agreement between two parties in which an owner allows another party to use that property under a certain set of parameters. A license agreement or license agreement usually involves a licensor and a licensee. If you own a patent on a useful technology, if you have a copyright in a popular photo, if you have filed a special image, or if you own another invention or creative work that you want to make money with, you will need a license agreement. This Agreement allows you to set the terms of everything related to that particular IP and to protect your proprietary rights, including how the licensee may use the IP, who owns the IP, who may sublicense the IP, the price of the license for the IP, and how long the licensee may use the IP. Royalties based on a measure related to sales of a product must be paid to the licensor, together with a report indicating how the royalty was calculated.

It should be decided how often and when these reports (and fees) are due. In addition, the licensor`s right to review the books that produce such reports should be part of the licence. Because of the legal basis they must cover, some licensing agreements are quite long and complex documents. But most of these agreements cover the same fundamental points. This includes the scope of the agreement, including exclusivity or territorial restrictions; financial aspects, including required advances, royalties and how royalties are calculated; guarantees of minimum turnover; Schedules with “To Market” dates, contract duration and renewal options; the landlord`s supervisory and quality control rights, including procedures to be followed; the minimum stocks to be retained; Finally, returns and compensation. A well-written license agreement is important for licensees and licensors. If your business needs help at any point in the process, our team of contract lawyers can help. Whether it`s writing the entire agreement or reading your own template, we have the expertise to make sure it`s done right. During negotiations, the licensor should focus on the following: The following sections seem exaggerated to the licensing professional.

However, a single section, if not treated with care and foresight, can result in an agreement that is more than unsatisfactory for one or both parties. License (close) Granting of permission to use an intellectual property right within a defined time frame, context, market line or territory. There are important differences between exclusive and non-exclusive licenses. An exclusive license is “exclusive” in terms of defined scope, which means that the license may not be the only license granted for a particular IP asset, as there may be many possible areas and areas of application that may also be subject to an exclusive license. By granting an exclusive license, Licensor promises that it will not grant any other license of the same rights in the same field or area covered by the exclusive license. The owner of the intellectual property rights may also grant any number of non-exclusive licenses that cover rights within a defined scope. A patent license is a transfer of rights that does not constitute an assignment of the patent. A trademark or service mark may be effectively licensed only if licensor controls the nature and quality of the goods or services sold by licensee under the licensed trademark. Under copyright law, an exclusive licensee is the owner of a particular copyright and can take legal action for infringement of the licensed right. There is never more than one copyright in a work, regardless of the owner`s exclusive license to various rights in different people. Export regulations are important in stores where technology is exported from the United States.

All exports must comply with U.S. export control laws and regulations, especially goods and intellectual property that may have military use. This is an issue that does not fall within the scope of this chapter, but as part of the checklist, it indicates to the negotiator that it is an issue to be considered. Other countries may have laws that deal with the same issue or issues or register the final agreement with the government. It is also a reminder jog for the negotiator. Your license agreement may contain only one or more of these payment methods. This section deals with the area, territory, rights of the former licensee and commercial rights that remain for the licensor. Some of what is included in this section appears in section 1 (the Parties) and may not be necessary in all situations. A license agreement or license agreement is a business between the owner of a patent, trademark or trademark and a person who wishes to use the patented or trademarked goods and services. The license grants permission to the licensee and contains provisions. The licensee must comply with these guidelines. One of the rules of the license agreement is usually a financial agreement to pay for the use of the license.

It is the ideal place to give very specific lists of the elements covered by the license, information documents and sketches of research project, as well as specific procedures. It may be easier to change a schedule than the entire contract in case changes are needed. Some types of schedules are listed. Here are 10 points that should be addressed in any license agreement: From a business perspective, the licensor has almost all the power in negotiating a license agreement. This party owns the trademark, trademark or invention that someone else wants. The Licensor has control over the use of the innovation. Anyone who wishes to do so must accept the licensor`s terms. To protect yourself and your business, it`s important to be thorough when creating a license agreement.

Both the licensee and the licensor must have a clear understanding of what they are accepting. Consider the following tips before you start: In May 2018, Nestlé and Starbucks signed a $7.15 billion coffee license agreement. Nestlé (licensee) has agreed to pay $7.15 billion in cash to Starbucks (the Licensor) for the exclusive rights to sell Starbucks products (single-serving coffee, tea, bean bags, etc.) worldwide through Nestlé`s global distribution network. In addition, Starbucks receives royalties on packaged coffees and teas sold by Nestlé. Exclusivity and territory. The licensee is granted the exclusive right to manufacture and sell the product in a specific territory. Licensor agrees not to allow anyone to sell the Product in this territory. This part of the agreement is usually associated with a term. Purpose – a complete description of the product or service offered for licensing. This is also the area where patent, copyright or trademark numbers may need to be provided.

The exact language of the grant must be specified. This includes the intellectual property rights under which the license is granted: only patent law or the right of know-how or both and the exclusive right, co-exclusive with the licensor or not exclusively. .

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