Royalty Bearing License Agreement
A licence fee is a payment to an owner or licensee of a given asset for the current use of its asset. When a business owner pays a portion of the income to the rightful owner of real estate, for example. B patents, copyrighted works, franchises or natural resources; You have a percentage of your revenue instead of using your assets, that`s what you call the royalty. It is a pay-based payment based on usage between two business entities to generate revenue or other desirable activities. Let us now turn to the practical considerations regarding the licensing of this technology. I will briefly look at license types, licensing considerations, warranty and indemnification considerations, and exit strategies. When I talk about a type of license, I am referring to licensing agreements, paid or inter-license. In some cases, the research agreement grants the sponsor a specific license for the exploitation of the intellectual property and describes the extent of the authorized use, unlike an option that only grants the right to subsequently obtain a license, but not the current rights. In cases where the promoter acquires ownership of a copyright or invention, the university retains a free right to use the intellectual property for internal research and teaching purposes and reserves the right to sublicense investigators for research and teaching purposes. Acme thus grants the licensee an exclusive license (pursuant to point 4.5) (with the right of sub-license) within the framework of patent rights in the field of use, to manufacture, use, sell, sell and import licensed products into the territory. Another type of license is a cross-licensing agreement in which each party owns intellectual property rights that the other party wishes to grant.
These agreements usually include future intellectual property rights for a period of years, for example. B 5 years, and there is compensation from one party to the other party to reflect the difference in value that each party obtains from the cross-license. After five years, the parties would renegotiate the license with further compensation based on the business history of the past five years. In some sectors, for example. B pharmaceuticals, the university may find it difficult to interest other licensees if a non-exclusive license is granted to a sponsor. Some potential licensees might not be willing to spend large sums of money to develop an IP product that the original proponent did not develop, but could then be marketed without a license or in an improved form. The terms of these licenses must be negotiated in good faith and agreed between the university and the sponsor. Finally, when it comes to licensing considerations, many licensees will insist on a clause known as the most favored license clause. This clause of a royalty agreement states that if, at a later date, another licensee receives a lower licence fee under the same conditions, the royalty in this licence agreement is also lower than that rate. From a practical point of view, these clauses are not frequent, since almost always two separately negotiated tariff agreements have conditions. Therefore, the conditions of the most favored license clause are almost never met. .