Combined Patent and Know-How License AgreementThis template covers both patent rights and know-how licensing, integrating provisions specific to each type of intellectual property while accommodating their distinct legal and commercial considerations.
Patent and Know-How License AgreementThis Patent and Know-How License Agreement (“Agreement”) is entered into on [DATE] by and between: Licensor: [NAME], a company organized under the laws of [JURISDICTION], with its principal place of business at [ADDRESS]. Licensee: [NAME], a company organized under the laws of [JURISDICTION], with its principal place of business at [ADDRESS]. The Licensor and Licensee are collectively referred to as the “Parties” and individually as a “Party.”
1. Definitions1.1. Licensed Patents: The patents and patent applications listed in Exhibit A, including continuations, continuations-in-part, divisionals, reissues, or extensions. 1.2. Licensed Know-How: Confidential technical information, processes, methods, designs, data, or expertise described in Exhibit B that are not publicly available. 1.3. Licensed Technology: The collective term for Licensed Patents and Licensed Know-How. 1.4. Field of Use: The application of the Licensed Technology solely in [SPECIFIC INDUSTRY, e.g., renewable energy systems]. 1.5. Territory: The geographical area where the Licensee is authorized to use the Licensed Technology, defined as [e.g., worldwide, specific countries].
2. Grant of License2.1. Patent License Grant: The Licensor grants the Licensee a [exclusive/non-exclusive/sole] license to use, manufacture, sell, and distribute products incorporating the Licensed Patents in the Field of Use and Territory. 2.2. Know-How License Grant: The Licensor grants the Licensee a [exclusive/non-exclusive] license to access and use the Licensed Know-How solely for the purposes outlined in the Field of Use. 2.3. Sub-Licensing Rights: The Licensee [is/is not] permitted to grant sub-licenses for the Licensed Technology. Alternative Clause: Sub-licenses are subject to prior written approval by the Licensor. 2.4. Improvements: - Any improvements to the Licensed Patents developed by the Licensee shall [belong to the Licensor/be co-owned by the Parties].
- Improvements to the Licensed Know-How shall be shared with the Licensor and considered part of the Licensed Know-How.
3. Obligations of the Parties3.1. Licensor Obligations: - Provide access to the Licensed Know-How within [e.g., 30 days] of signing this Agreement.
- Assist the Licensee with initial training on the application of the Licensed Technology.
3.2. Licensee Obligations: - Use the Licensed Technology solely within the Field of Use.
- Maintain the confidentiality of the Licensed Know-How and implement measures to prevent unauthorized access.
- Submit reports on the use of the Licensed Technology as outlined in Section 6.
4. Royalties and Payments4.1. Upfront Payment: The Licensee shall pay the Licensor a non-refundable upfront fee of [AMOUNT]. 4.2. Running Royalties: The Licensee shall pay royalties of [PERCENTAGE, e.g., 5%] on the net sales of products utilizing the Licensed Technology. 4.3. Know-How Fee: An additional annual fee of [AMOUNT] shall be paid for access to and continued use of the Licensed Know-How. 4.4. Milestone Payments: - [E.g., €50,000 upon regulatory approval].
- [E.g., €100,000 upon achieving €1,000,000 in net sales].
Example: Kimble v. Marvel Entertainment, LLC, 576 U.S. 446 (2015) Royalty payments cannot extend beyond the life of the Licensed Patents unless explicitly tied to the Licensed Know-How or other considerations.
5. Confidentiality5.1. The Licensee agrees to maintain the confidentiality of the Licensed Know-How during the term of this Agreement and for [e.g., five years] thereafter. 5.2. Permitted disclosures include: - Employees directly involved in the use of the Licensed Know-How, bound by confidentiality agreements.
- Third parties with the Licensor’s prior written consent.
5.3. Optional Clause – Reverse Engineering: The Licensee is expressly prohibited from reverse-engineering the Licensed Know-How. Alternative Clause: Reverse engineering is permitted only for internal research and development purposes.
6. Reporting and Records6.1. The Licensee shall submit quarterly reports detailing sales, revenues, and royalty payments related to the Licensed Technology. 6.2. The Licensor may audit the Licensee’s records annually, with prior notice of [e.g., 14 days].
7. Term and Termination7.1. Term: This Agreement shall remain in effect until the expiration of the last Licensed Patent or [e.g., 10 years] from the date of this Agreement, whichever is later. 7.2. Termination for Breach: Either Party may terminate this Agreement upon [e.g., 30 days] written notice if the other Party fails to remedy a material breach. 7.3. Post-Termination Obligations: - The Licensee must cease using the Licensed Patents and destroy or return any Licensed Know-How.
- Products already manufactured may be sold for a period of [e.g., six months] post-termination.
8. Governing Law and Dispute Resolution8.1. Governing Law: This Agreement shall be governed by the laws of [e.g., Germany, New York State]. 8.2. Dispute Resolution: Disputes shall be resolved through [e.g., ICC arbitration in [CITY], litigation in the courts of [JURISDICTION]].
9. Miscellaneous9.1. Entire Agreement: This Agreement constitutes the entire understanding between the Parties and supersedes all prior agreements. 9.2. Force Majeure: Neither Party shall be liable for delays caused by events beyond their reasonable control.
ExhibitsExhibit A – Licensed Patents: - Patent No. [123456]: [Title/Description].
- Patent Application No. [7891011]: [Title/Description].
Exhibit B – Licensed Know-How: - [E.g., proprietary manufacturing process for renewable energy components].
- [E.g., technical schematics and operating manuals].
Best Practices for a Mixed Patent and Know-How Agreement- Clearly Define IP Rights: Ensure the scope of both patents and know-how is explicitly detailed.
- Tailor Royalties: Differentiate between patent-based royalties (limited to the patent term) and know-how fees (which may extend beyond patent expiration).
- Include Safeguards: Robust confidentiality provisions are critical for know-how protection.
- Consider Improvements: Address ownership and licensing of any improvements to the Licensed Technology.
- Comply with Jurisprudence: Reference key cases, such as Kimble v. Marvel Entertainment, to ensure the agreement is legally enforceable.
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