Licensing Agreement Checklist

A Checklist for Negotiating License Agreements

© & Courtesy


This chapter provides a road map for licensing professionals to identify the most common terms, contractual obligations, and other provisions that are likely to be encountered in crafting a license agreement. Emphasis is placed on agricultural technology licenses. Since most people engaged in deal making are involved in multiple deals at the same time, important aspects can be forgotten or overlooked at any time and for any deal. The checklist format allows the licensing practitioner to check off each item once it has been addressed to the parties’ satisfaction. While expansive, it does not necessarily fit all contexts and is therefore intended to serve as a basis from which institutions and individuals can develop their own checklists.

1. Introduction

A checklist to aid in negotiating a licensing agreement, much less to aid in actually preparing and writing the agreement itself, may sound like a simplistic tool to an experienced negotiator or contract attorney. After all, most people in such positions are well educated and used to dealing with multiple projects having many details in the scientific, legal, and business arenas, all at the same time. If they did not have the competence to deal with this type of work situation, they would not last long in the active, high-pressure licensing environment. But it is precisely because of myriad details that a checklist can be life (or deal) saving for the working licensing officer or attorney. Since most people engaged in deal making are involved in multiple deals at the same time, important aspects can be forgotten or overlooked at any time and for any deal. One of the simplest ways to make sure that a crucial or costly mistake does not happen because of an oversight is to use a tool such as the checklist presented here.

2. Specific Checklist Sections

This section introduces and discusses for both licensors and licensees each element of the checklist. If your work requires you to draft license agreements, download the checklist from the online version of this Handbook where it is given without the annotations.

2.1 Section 1 – The parties

Although seemingly self-evident, having all pertinent information about the parties in one place, such as their legal names, the negotiating party’s contact information, and the legal addresses is a time saver when the final agreement is being written. No more last-minute telephone calls or e-mails to get information that should have been exchanged at the first meeting.

PARTIES: Licensor’s Name:____________________________________ Address:___________________________________________ Principal Office:______________________________________ Incorporated In:___________________ Short Title:_________ Contact Name:_______________________________________ Contact Title:________________________________________ Contact Tel/Fax:_____________________________________ Contact E-mail:______________________________________ Licensee’s Name:____________________________________ Address:___________________________________________ Principal Office:_______________________________ Incorporated In:___________________ Short Title:_________ Contact Name:_______________________________________ Contact Title:________________________________________ Contact Tel/Fax:______________________________________ Contact E-mail:_______________________________________

2.2 Whereas clauses

The following set of “whereas clauses” is offered as a guide for detailing the background of the license. Not all parties use whereas clauses; some prefer to make the background information a standard set of clauses that follow language specifying that “the following are terms of the Agreement” or similar language. Some use of background information in a contract is recommended because within a short period of time after the deal is done and the agreement signed, negotiators memories will fade and a short set of statements regarding the background of the deal may become invaluable should the contract need to be interpreted by a court or an arbitrator.

WHEREAS CLAUSES: Licensor owns/controls certain Intellectual Property/Tangible Property including inventions
______, patents ______, applications______, know-how ______, other_______ relating to
________________ Licensor represents that it has the right to grant a license to _________ Licensee owns/controls certain Intellectual Property/Tangible Property including inventions
______, patents______, applications ______, know-how ______, other _________ relating
to ________________ Licensee represents ________________________________ Licensee desires license relating to ___________ in order to ________________

2.3 Definitions

A simple contract will not need to have a section devoted to definitions, as the definitions can be presented when special terms are first encountered. A complex document should present all definitions in one section for ease of drafting and later interpreting the contract. General terms used throughout the contract should be placed in this section, as should technical terms that are used frequently. Either an alphabetical or a hierarchical order is recommended, the latter being used when a number of terms are closely related and having them near to each other would allow the reader to more easily navigate the agreement.

Each license will have its own specific set of definitions, so a short list that includes only the most commonly used terms is presented here.

DEFINITIONS: All other appropriate terms should be listed and defined. Clear definitions will add great clarity to a license. Care should be taken to write definitions that, in general, stand alone and are not circular in construction. A good place to begin thinking about what to define is with a definition of the parties. If dealing with a company, is it the company and all its affiliates? All of its subsidiaries? Or only the parent company? Products/Processes licensed should be specifically defined as Licensed Products or Licensed Processes. If only certain types of inventions are covered, define the inventions here and refer to them as Inventions; include the patent number and/ or patent application number that is being licensed, and specify if Know-how is included. Licensee, sales, net sales, profit, territory, field, patents, patent rights, intellectual property, and nonprofit are examples of other relatively common terms, and there are many more. Once defined, these terms will usually appear, throughout the rest of the contract, with the first letter capitalized or in all capitals.

2.4 The grant sections

The following sections may seem to be overkill to the licensing professional. However, each and every section, if not handled with care and forethought, can result in a deal that is more than unsatisfactory to one or both parties.

2.4.1 Rights granted

The exact grant language should be specified. This includes which intellectual property rights the license is given under: patent right only or know-how right or both and exclusive right, coexclusive with the licensor, or nonexclusive. The section should also specify the term of the exclusivity and/or nonexclusivity, and whether such right is irrevocable; and if there is a right to grant sublicenses. Each organization will find that it tends to make deals in a certain way and may find that certain combinations of grant language will be used repeatedly. In that case, this section may be easily amended to the specific organization’s needs.

RIGHTS GRANTED: a) All substantial (statutory) rights to practice under the rights in specified Intellectual Property/Tangible Property (detail here)________________; b) and to make ____, have made_____, use_____, import_____, offer for sale____, and sell
_____ products and processes; c) Exclusive for______ years and nonexclusive thereafter, or d) Non-exclusive______, to make (manufacture)______, or e) Exclusive_____ to have made for own use______; or f) Exclusive except as to Licensor______, to use______, to export________, to make and sell
in limited markets_______; g) Irrevocable______, to sell______, have sold________; h) With right to grant sublicenses______, to lease______, rent______.

2.4.2 License restrictions

This section deals with the field, territory, prior licensee’s rights, and the commercial rights retained by the licensor. Some of what is contained in this section appears under Section 1 (the parties), and may not be needed in all situations.

LICENSE RESTRICTIONS: Limited to the Field_________________________________________________________
Limited to Territory_________________________________________________________
Subject to prior Licensee (identify, if any) rights_________________________________
Subject to Licensor’s right to make______, have made______, use______, have used
_____, export_____, import_____, sell______, have sold______ (as many as applicable).

2.4.3 Reservation of rights

This section is particularly important when the licensor is a nonprofit and must ensure that certain rights to use the intellectual property are reserved for academic, nonprofit research, or humanitarian uses in developing countries, or according to the terms of the Bayh-Dole Act (in the United States). Forgetting to include the needed reservation of rights in a license could make the license invalid and/or could lead to an expensive court fight to determine what rights are in fact owned by the licensor.

RESERVATION OF RIGHTS: a) Licensor hereby reserves an irrevocable, nonexclusive right in the Technology (on behalf of itself and all other nonprofit/academic research institutions) b) For Educational and Research uses_____, including uses in Sponsored Research ____ and
nonprofit collaborations_____. c) For Humanitarian Purposes_____, or d) For uses in Developing or Economically Disadvantaged countries_____ (specify countries)_
________, e) For the U.S. government under the Bayh-Dole Act______.

2.4.4 Right to grant sublicenses

The grant of a right to grant sublicenses to third parties also has a number of important choices that must be considered by parties when awarding this portion of the license. Sublicensees may be anyone or may be limited to, for example, only parties in privity with the licensee; only affiliates of the licensee; only a specified number of third parties; or only parties preapproved by the licensor.

LICENSEE MAY GRANT SUBLICENSES: a) To any other party ____; b) To limited number of parties_____; c) To Affiliates of Licensee ____ only_____; d) To third parties preapproved by Licensor ____; e) To nominees of Licensor ____; f) At specified consideration (indicate)____________________; g) Consideration to be shared with Licensor________________; h) Copies of sublicense to be furnished to Licensor________; i) Under other conditions_______________________________________

2.4.5 Territory

The territory that is granted to the licensee under the license must be specifically identified.

TERRITORY: a) All countries______ b) All countries except_______________________ c) Following country/countries_____________________________________ d) That portion of a specific country comprising___________________

2.4.6 Term of the agreement

The date the agreement begins, the effective date, should be noted, as well as the ending date of the agreement, by whatever method that is calculated. Some of the most common ways are listed below.

TERM OF AGREEMENT: Effective Date is_______. For______ years/months/day (as agreed), until (specify date)_____; or
For the life of a specific patent or other intellectual property________; or
Until some future event (specify)______________________________

2.5 Improvements

This section deals with any improvements made and/or patented (by whom and paid for by whom) during the term of the license by either the licensor or licensee and what obligations are present in the deal as to whether or not to include future technology under the present license or to have future technology fall under the reservation of rights to the licensor.

Not included______Not included_________
Who will file_____________________________Who will file_________________________
Who will pay costs_______Who will pay costs_________
Assigned/licensed to Licensee______.Assigned/licensed to Licensor_________

2.6 Consideration

The consideration sections of the checklist is relatively involved, and can be cut back if equity is not part of the payment for the license. Royalty, milestone payments, type of currency, determining rate of exchange, and equity-ownership issues are listed here, as is the issue of minimum annual payments, particularly important in the case of an exclusive license.

8. CONSIDERATION FOR LICENSE: Royalty free ___; or
Royalty, ____ per cent; of profits______; of gross sales______; of net sales______; specific
amount (specify)______ per unit (specify)______; other (specify)_________; Single sum (license fee) of_________; Milestones (what they are and amount owed)________________________; Payment is to be made in currency of which country___________; At the then current rate of exchange___________________; At the rate of_______(currency) for________ (currency) If exchange rate decreases or increases by ____(specify a percentage) % the payments shall decrease or increase by like amount; or exchange rate shall be that published in__________________. Equity: Stock of Licensee (specify)_____________________________
stock of existing company______; new company______
value of the shares of stock shall be market value ____ at date of agreement_______
book value______ according to Schedule ____; stock shall have full voting rights
______; nonvoting______;
MINIMUM ANNUAL PAYMENT FOR LICENSE: Amount______ per calendar year; per 12-month period______
Payable in advance______ Payable at end of calendar year______; of 12-month period______
Credited against earned royalties, yes______; no______

2.7 Reports and auditing of accounts

Royalties based on any measure tied to a product’s sales should be paid to the licensor accompanied by a report stating how the royalty was calculated. It should be decided how often and when these reports (and royalties) are due. Additionally, the right of the licensor to audit the books that generate these reports should be a part of the license.

STATEMENTS OF EARNED ROYALTY: Quarterly, within______ days of end of quarter
Annually, within______ days of end of year
Other periods, (specify)____________________ In writing, and certified by __(official or auditing firm) ____
With names and addresses of sublicenses______ With copies of sublicenses______ Together with payment of royalty accrued______ INSPECTION OF LICENSEE’S ACCOUNTS: Not permitted______ Permitted______
at any time during business hours______
at specified times______
by Licensor’s authorized representatives______
by Certified Public Accountants______ Audit to be paid by Licensor unless underpayment is greater than ___%

2.8 Representations/warranties

Certain basic representations and warranties should be given by each party to the other, such as the ability to enter into this agreement, the validity of the intellectual property, and a standard warranty disclaimer. These and others are listed below.

Not admitted______
Admitted to Licensee______ If patents held invalid, then:
Licensee may terminate: as to invalid claims______
entire agreement______ Good title to Intellectual Property in_______ (specify countries) Authority of Licensor to enter into the License_____
Authority of Licensee to enter into the License_____ D. Standard warranty disclaimer, of fitness for particular purpose Merchantability______; Express or Implied______.

2.9 Infringement

These sections deal with how past infringement by the licensee is handled; if the IP is infringed by third parties, how such infringement will be handled, and if there is a recovery for the infringement, how that will be divided between the licensor and licensee. Indemnification by the licensor of the licensee to practice under the IP rights is also covered.

INFRINGEMENT: INFRINGEMENT OF LICENSED INTELLECTUAL PROPERTY/TANGIBLE PROPERTY Past infringement by Licensee forgiven______; not forgiven______ forgiven for payment of______ If infringed by others: Who will notify_______________
Who will file suit______________
Who is in charge of suit________
Costs: borne by______________ divided______________ INFRINGEMENT OF OTHER’S INTELLECTUAL PROPERTY/TANGIBLE PROPERTY
No indemnity by Licensor______ Licensor indemnifies Licensee______ Licensee indemnifies Licensor______ Who will notify_____________ Who will defend_____________ Who will pay costs__________ Costs: borne by____________
divided_______________ RECOVERY AFTER DECREE Retained by______; Divided______ Right to settle suit: by Licensor______; by Licensee______
by Licensor only with consent of Licensee______
by Licensee only with consent of Licensor______

2.10 Diligence

Diligence covers the concept that the exclusive licensee will do all it can to operate under the license so that the licensor reaps a monetary benefit under the license. If this issue is not covered, then the exclusive licensee can sit on the technology and keep others from exploiting it and bringing money to the licensor.

DILIGENCE BY LICENSEE (Usually in absence of minimum royalty): No obligation______ Licensee will use its best efforts to______ Licensee will use its reasonable best efforts______ Licensee agrees to: produce______ or sell______ specified units_____
produce______ or sell______ specified products ____
invest specified amount____________________
satisfy demands of trade______
not to refuse reasonable request for sublicense______ Penalty for lack of diligence: license converted to nonexclusive______
Licensor may nominate Licensees______ Licensor may terminate __ upon __ days’ notice in writing

2.11 IP defined

Intellectual property (IP), and how it is paid for, must be defined in the agreement, whether it is only one patent or if it includes various reports and tangible materials. This part of the checklist may be more relevant to for-profit licensors, but nonprofit licensors may also have more than just a patent (and its family) to include in the definition of IP.

INTELLECTUAL AND TANGIBLE PROPERTY OF LICENSOR: Not included, except as described in patents or applications______
Included for products (specify)_______________________ For term of agreement______; for specified term______ For territory of license______; for other territory_______ NATURE OF INTELLECTUAL AND TANGIBLE PROPERTY Invention records __Know-how, not confidential ___ Laboratory records ___Know-how, confidential ____ Research reports ___Employee to be bound______ Development reports______ Laboratory notebooks______ Construct components and design______ Test field lay-out and design______ Production specifications______ Raw material specifications______ Quality controls______; ISO 9000 procedures_______ Economic surveys______ Market surveys ___; Producer lists __; Brokers ___ Promotion methods______ Trade secrets______ List of customers______ Drawings and photographs______ Models, tools and parts______ Germplasm____________________ Other (specify)____________________________ PAYMENT FOR INTELLECTUAL AND TANGIBLE PROPERTY Included in royalty______ Not included in royalty______ Single payment of________________________________
Stock in amount of_______________________________
Annual service fee of______________________________
for term of agreement_______________________
for specified term__________________________
If Intellectual Property surrounding it is held invalid: Know-how payment stops______
Know-how payment continues______
INTELLECTUAL AND TANGIBLE PROPERTY OF LICENSEE: Not included, except as described______ Included for products (specify)______________________
For term of agreement______; for specified term ___
For Territory______________________ Nature of Property included:_________________

2.12 Right of inspection; technical personnel

If the licensee has licensed seed that is being produced by the licensor and that will include the transfer of tangible material (the seed) to the licensee, the licensee may want to have the right to inspect the licensors research data and fields during the term of the license. Whether or not licensors personnel shall be used to transfer know-how or tangible materials to the licensee, and at what cost, is also an important item to note in the contract.

RIGHT OF INSPECTION: Licensee shall have the right to inspect Licensor’s: Research laboratory______ Development laboratory______ Laboratory notebooks______ Test fields______ Production fields______; Nurseries______; Greenhouses_____ Number of visits permitted per year______; Number of persons______ Special conditions of visits_______________________________________ Licensor shall have reciprocal rights of inspection___________________ TECHNICAL PERSONNEL: Licensor shall provide technical personnel to deliver Intellectual Property/Tangible Property (specify)_________: At Licensor’s expense______; At Licensee’s expense______
Not more than______ persons for not more than______ days
At a fee which shall be the salary, plus______ per cent Travel expenses______; living expenses______
borne by Licensor______; borne by Licensee______ Number and duration of stay of technical personnel determined by: Licensor______; Licensee______; mutually______ Ownership of reports made by technical personnel________

2.13 Remaining sections

The remaining sections of the checklist are what may be identified as the “boilerplate sections” of the license, even though all of these terms are subject to negotiation. In any case, confidentiality terms, provisions for export control, the non-use of each party’s name by the other party, arbitration (or not), terms of breach that will cause termination of the contract and the ramifications thereof, force majeure, assignment, favored-nation clause, notices, integration, language, modifications, applicable law, and schedules should be standard items considered by every licensing professional.

2.14 Confidentiality

If a confidentiality, or nondisclosure, agreement has been entered into by the parties and will remain effective during the term of the license agreement, nothing else is needed. If this hasn’t been done, a section dealing with terms of confidentiality may be put into the license agreement. If the previously agreed-to confidentiality agreement is weak, now is the time to bolster it and to make sure that these terms in the license agreement take precedence over earlier agreements.

19. CONFIDENCE OF CONFIDENTIAL INFORMATION: No obligation______; Licensee obligated______ Both parties obligated______ Confidence maintained for specified time ____; Without limitation as to time______; life of
agreement______ Until published by owner______ Existence of this agreement confidential ___; Terms and conditions of this License to be kept confidential ___ Other_____________________________

2.15 Export regulations; use of party’s name

Export regulations are important in deals where technology is exported from the United States. All exports must comply with U.S. export control laws and regulations, and in particular, those goods and IP that may have a military use. It is a topic outside of the scope of this chapter, but as an item on the checklist, it alerts the negotiator that this is a topic to be considered. Other countries may have laws dealing with the same topic or with issues or registering the final agreement with the government. Again, this is a memory jog for the negotiator.

In some cases, either one or all of the parties will not want its/their name used in connection with any licensed products advertised or sold, as it may suggest that the licensing institution is recommending these goods. If this is the case, this should be stated in the agreement.

A. EXPORT CONTROL_______ B. Government registration regulations_____ NON-USE OF NAMES Licensor’s______, with permission______
Licensee’s______, with permission______

2.16 Arbitration

In the case of a major disagreement about the terms of an agreement, parties may wish to take the issue to arbitration. Arbitration can be carried out in many different ways and it is easier to specify in the agreement the rules to be used for arbitration, before there is an issue to arbitrate.

ARBITRATION: No right of arbitration______ Parties will use their best efforts______
Parties agree to arbitration by: American Arbitration Association______ By other body______ By three persons, one selected by each party and a third by the selected persons______ Appeal from arbitration decision: Not permitted, decision final and binding______
Permitted_____________ to____________

2.17 Termination

The termination section of an agreement can be quite complicated, or it can be very simple. I have seen agreements that have been hung up on determining what to do with the rights of the parties if a material breach were to occur. Thought should be given to this area, but beware of having it take over the negotiation. Areas to consider include the right of either party to end the agreement for no reason at all; the rights of the party that has performed when confronted with a party that refuses to perform; material breach issues; and length of notification of breaching activity and time given to the breaching party to cure the breach before losing rights and/or being charged penalties. Issues dealing with the natural expiration of the license should be considered, as well. What happens to the know-how (if any) upon the expiration of all patents? And what are the confidentiality provisions?

TERMINATION: By Licensor: If certain person incapacitated ___ (name) ___ If certain person terminated __ (name) __ At specified time______ Upon breach after __ days written notice if not remedied within ____ days
Other___________________________________ By Licensee: At any time upon______ days written notice
On any anniversary date______ At a specified time______ Only upon payment of penalty of__________ dollars
Upon breach after ___ days written notice if not remedied within __ days Other___________________________________ Upon expiration, Licensee assigns to Licensor: Trademarks______ Patents______ Copyrights__________ Sub-licenses__________ As to any specified patents or applications______ Germplasm_________________ As to any specified country______ Of exclusive license with right to continue as nonexclusive______
Whenever any essential claim held invalid______ Upon bankruptcy of either party______ Upon Termination, without breach, Licensor assigns to Licensee: Trademarks______ Patents______ Copyrights___________ Sublicenses______ As to any specified patents or applications______ Germplasm_________________ As to any specified country______ Of exclusive license with right to continue as nonexclusive______
Whenever any essential claim held invalid______ Upon bankruptcy of either party______ Upon Termination with breach, Licensee assigns to Licensor: Trademarks______ Patents______ Copyrights_________ Sublicenses______ As to any specified patents or applications______ Germplasm_________________ As to any specified country______ Of exclusive license with right to continue as nonexclusive______
Whenever any essential claim held invalid______ Upon bankruptcy of either party______ Upon termination, with breach, Licensor assigns to Licensee: Trademarks______ Patents______ Copyrights_________ Sublicenses______ As to any specified patents or applications______ Germplasm_________________ As to any specified country______ Of exclusive license with right to continue as nonexclusive______
Whenever any essential claim held invalid______ Upon bankruptcy of either party______

2.18 Force majeure

This is the “it is out of my control” reason for not performing under the license. A hurricane has just wiped out your seed crops for the year, and you have no seeds to provide or to sell; your chemical plant just went up in flames. Things happen, and this fact of life should be considered in the contract. The key is to determine what is required after the force majeure occurs to get the licensed product out the door, or the goods to the licensee as quickly as possible. Technically a French term, it literally means “greater force.”

24. FORCE MAJEURE: Licensor has right______ Licensee has right______ Both parties have right______ Nature of Force Majeure: Natural events: fire, floods, lightning, windstorm, earthquake, subsidence of soil, etc. (specify)______________ Accidents: fire, explosion, equipment failure, other___________ Civil events: commotion, riot, war, strike, labor disturbances, labor shortages, raw material and equipment shortages______ Governmental: government controls, rationing, court order______ Any cause beyond control of party______ Time after occurrence that the exclusive license becomes nonexclusive_____months
If there are fixed payments, are they excused during FM period ___?

2.19 Assignment provision

A license is considered to be personal to the licensor, especially in the case of an exclusive license. The licensor hand picks the licensee, for many reasons, and rejects others for many reasons. Additionally, an exclusive licensee may be interested in taking a license from a particular licensor, and not from another. In these cases, the right to assign a license may be forbidden, or at least greatly limited to “only with the permission of the nonassigning party.” Nonexclusive licenses tend to be more open to assignment, especially if there are many licensees. There may or may not be fees attached to the transfer, or assignment, of a license.

ASSIGNMENT OF AGREEMENT AND LICENSE: a) Not assignable by either party______ b) Assignable by Licensor, without consent of Licensee __; only with consent __ c) Assignable by Licensee, without consent of Licensor; only with consent ___ d) By either party upon: Merger______ To successor of portion of business involving: license___; or only entire business ___ To any company of which a majority of stock is owned______ To any company of which a controlling interest is owned______ Binding upon heirs, successors and assigns______
Fee for assigning_______ How much?________

2.20 Favored nation

A licensee may demand that they pay the same royalty and/or fee as another licensee that pays the least for the same license. This can be limited, for example, to the same royalty rate, but not to up-front fees, or not take in consideration the worth that cross-licenses to IP bring to a deal. Generally, it is very tough to determine if one party has a better deal than another unless it is a straight money deal.

FAVORED NATION CLAUSE: Licensee guarantees performance (and amount of return)______
Licensor required to notify Licensee of similar license______
Licensee has option to take term of similar license______
License changed to terms of more-favorable license______
Licensee may terminate if not given cheaper license______

2.21 Notices; integration; language; modifications; law; signatures

You will find that clauses that involve the following issues tend to be boilerplate clauses:

  • Notices. the handling of any notices, payments, and so forth, that you must make or should receive
  • Integration. a statement that this is the controlling document, no matter what else was said or signed previously, unless specifically stated in the license.
  • Language: deals with languages used in writing the license (Will each translation of the license be acceptable? Or only the license written in one of the languages?)
  • Modifications: specifies whether amendments to the license are to be in writing (If oral changes are OK for your deal, or for portions of it, specify it here.)
  • Law: specifies which country’s laws will be applied to interpreting the license; what courts will hear a lawsuit; and in what country, specifically, lawsuit would be filed.
  • Signature: recommended to type in the name and title of the signatory (Two years after signing, all parties to the deal may have changed, and many signatures may be illegible by then.)
NOTICES AND ADDRESSES: By registered mail______ By registered air mail (for foreign licenses)______ By overnight mail______ After ___ days if by FAX with confirming telephone call ___
After ____ hours if by e-mail to ____specify_____
Licensor’s legal address for notice:___________________
Licensee’s legal address for notice:___________________ INTEGRATION: This instrument is the entire agreement between parties______ This agreement supersedes all______ prior agreements between the parties or the
agreement dated_____________________ LANGUAGE (for agreement with foreign language licenses): The official language(s) shall be __specify language(s)____
Copy in_____ language shall be official______; unofficial __ MODIFICATIONS AND AMENDMENTS: This License can not be modified or amended___________ No modification effective unless written and signed by both parties __ APPLICABLE LAW: To be read, construed, understood and adjudicated according to the laws of_______ in the courts located in__________. 32. SIGNATURES: For Individual: Witnessed by______ witness(es)
For Corporations: By officer______
Title shown______

2.22 Schedules

This is the place to give very specific listings of items covered in the license, background documents, and research project outlines and specific procedures. It can be easier to modify a schedule than the whole contract, should the need for changes arise. A few types of schedules are listed.

SCHEDULES: PATENT LIST (Give inventor, number, issue date, official title) PATENT APPLICATIONS (Give inventor, number, filing date, official title) DESCRIPTION OR COPIES of official documents, such as sublicenses, assignment, prior license, etc. ACCOUNTING PROCEDURES for determining sales, net sales, sale value of stock, or other property EXISTING LICENSES AND/OR SUBLICENSES SPECIFICS OF EQUITY ARRANGEMENTS RESEARCH PROGRAM DETAILS

3. Conclusion

This license checklist is a comprehensive tool useful for capturing very important concepts and terms in a complex license. Nonetheless, the checklist can and should be modified by each institution to reflect the way it does business. Having key concepts available to the negotiator and license draftsperson with a quick reading of a checklist can save much aggravation and potential misery should a deal go bad during its lifetime. It is much more cost effective to craft a sound license up front, having key terms as well-defined as possible, than it is to fix the problem through arbitration or litigation later on.