Licensing Agreement Checklist
All License Agreements are ‘NOT CREATED EQUAL!" The type of licensed property/material involved, has a significant effect on the terms that are essential to the License Agreement. In addition, there are several other important factors that influence the content necessary to create a comprehensive licensing agreement.
Licensing Agreement Issues.
To the extent possible, make sure the proposed licensor has the right to license the property to be licensed, without limitation (e.g. does the licensor own the property and if not, does the licensor have the right to sublicense?; has the licensor licensed rights to others?; If the licensor does not own the rights, obtain copies of license agreements back to the owner).
1. All agreements should include the full legal names and physical address of each party.
2. The Licensing Agreement should contain an accurate, concise, description of the licensed property.
3. Address ownership issues related to derivatives or inventions created by the licensee resulting from the use of the licensed property.
4. Clearly describe the license being granted, including issues of exclusivity, right to sublicense rights, etc.
5. Describe limitations, so as to avoid having the license fall within the scope of franchise law, which is highly regulated, calling registration of the opportunity and other steps to become compliant.
6. Determine the Territory for use and marketing of the licensed property.
7. Allocate responsibility for regulatory filings and export licensing issues, if applicable.
8. Determine required quality control and reporting requirements.
9. Address Royalty issues and allocate responsibility for taxes.
10. Address use of related intellectual property, such as trademarks, etc., related to the licensed material.
11. Determine the terms of the agreement and whether there will be options to renew.
12. Determine what is required if quota or minimum royalty not achieved.
13. Determine what is required in event of termination.
14. If a patent is involved, allocate responsibility for pursuing third parties for infringement.
15. Include comprehensive indemnification clauses.
16. Determined insurance requirements.
17. Include Confidentiality, non-disclosure provisions with special language for trade secret protection.
18. Include the representations and warranties of the parties that each party is relying upon in entering the Agreement (e.g. that the licensor actually has the right to license to you without limitations, etc.).
19. Determine the governing law.
20. Include other significant and important issues that are unique to your particular situation.
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