| Term / Period (Schedule 1) |
- The time period of the licence
- Generally, this covers the life of any registered IPR or a defined number of years for copyright or software licences
- In some cases, there may be limits on the ability to licence IPR beyond the term of its registration and this is reflected in the template, with the intent that the Term applies to the fullest extent practical/permitted
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- Clarity over how long the licence will last and what happens when it expires
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- Ensure the industry partner has the rights it needs for long enough, and that this matches your business model and the level of investment needed to get to market
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| Licence Scope and Sublicensing (Schedule 1) |
- The scope of the licence and the breadth of the exclusivity in term of commercialisation rights. Careful consideration should be given when granting any exclusive licence
- The Agreement provides a limited right for the Licensee to on-license its rights to third parties – as this is usually required in the case of Commercialisation. These provisions could be removed if the Licensee will only be directly manufacturing and selling products, or using the technology to provide services to end users
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- The granted rights should match the needs, capabilities and commitment from the company
- Consider what level of sub-licensing rights are required for the industry partner to meet its business plan and to ensure the market for the licensed IPR is maximised
- It is usual in an exclusive licence that the university would want rights to continue to use the licensed IPR for academic research and teaching purposes. If this is required, there should be a licence granted back to the university for this purpose
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- Ensure the industry partner has the rights it needs and that this matches your business model and the level of investment needed to get to market
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| Licence Application & Territory (Schedule 1) |
- A clear definition of the specific application fields of use or application that the exclusive licence is granted for
- The geographical territories of the licence e.g., Australia
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- Ensure that the licence is to those application fields of use where the industry partner has expertise and, in those territories, where the company plans to commercialise the licensed IPR
- This is particularly important with IPR that can be applied in many different applications (so called platform technologies) where separate exclusive licences by application could be granted
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- Ensure the industry partner has the rights it needs and that this matches your business model and the level of investment needed to get to market, and the countries you operate in
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| Licensed IPR & Technology (Schedule 2) |
- A clear definition of what IPR is being licensed and its technology field and intended applications
- The template provides tables in Schedule 2 to detail registered IPR, know-how and other forms of IPR (e.g., software) within the licence scope as well as details of any Materials being transferred as part of the licence and how they need to be treated
- It may be appropriate to grant non-exclusive rights to certain IPR which is required for commercialisation of the exclusively licensed IPR. For example, where the University has a first patent that covers multiple products/applications and the licensee needs a non-exclusive licence to this IPR in order to commercialise a second University patent that it has exclusively licensed
- This template does not provide for technology transfer services (e.g., instruction and training, maintenance services, show-how, help desk or personnel support etc). If the Licensee requires such services, the simplest approach is to use a separate agreement. The parties could also agree such arrangements as optional clauses to be added to this template
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- Be clear on exactly what is being licensed and what is not
- Check that you have the right to grant the rights to the IPR and that all relevant information on each type of IPR under the licence is captured in the tables
- Consider whether a separate technology transfer agreement is appropriate
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- Be clear on exactly what is being licensed to ensure the industry partner has access to everything it needs to commercialise the IPR
- Consider whether a separate technology transfer agreement is appropriate
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| IPR management and costs |
- The parties will need to agree an IP Management Plan for how they will cooperate in the management of registered IPRs and how costs will be divided. This plan should also detail how income from successful infringement actions will be dealt with
- It is usual in an exclusive licence that the licensee is able to direct (at their cost) the prosecutions and maintenance of registered IPR
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- Ensure you understand your obligations under the IP Management Plan and that the licensee is involved in all major decisions as agreed in the plan
- Ensure the licensee reimburses all agreed costs
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- Ensure you can direct the prosecution and maintenance of licensed IPR as needed to support your commercial activities
- Be clear of your obligations with respect to IPR prosecution and maintenance costs
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| Confidential Information (Schedule 2) |
- Details of any confidential information exchanged under the licence should be recorded in Schedule 2 and the term that this will be kept confidential
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- Ensure a clear description of any confidential information relating to the Licensed IPR is recorded
- Ensure you understand your obligations with respect to confidential information shared with you
- Ensure your confidential information is kept confidential by the industry partner for as long as needed so as to impact on the value of the licensed IPR. For some information a perpetual term may be appropriate
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- Ensure details of any confidential information arising from your use of Licensed IPR are recorded
- For example, you would usually expect progress and payment reports that you share with the Licensor to be kept confidential
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| Improvements (Schedule 1) |
- Any Improvements (that the Licensee creates under the Licence) will be owned by the Licensee by default, but can be amended to the Licensor if identified in the Details Schedule
- If the Licensor also wants to use these improvements, this will need to be agreed and included in the Details Schedule
- Although rare in an exclusive licence, there may be occasions where it is appropriate that the Licensor owns any Improvements made by the Licensee
- There are a range of alternative approaches to dealing with Improvements, depending on the context of the transaction. This template should be regarded as a starting point for negotiations on these aspects
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- Where the University is the Licensor, it may be appropriate to ask for a licence to Improvements created by the industry partner for research and teaching purposes
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- The industry partner would expect to own the Improvements it makes
- Where the industry partner is the Licensor, it can be important to have access to Improvements made by the Licensee to enable the industry partner to use these themselves
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| Warranties (Schedule 1) |
- The default position is that the Licensor provides warranties as to non-infringement of IPR that is not required to be registered and based on their knowledge for registered IPR, but that otherwise the Licensee exploits the licensed technology at its own risk
- The precedent states that the Licensor has not conducted exhaustive patent searches and gives no warranty that the patent does not infringe the rights of a third party. The Licensee must make its own "freedom to operate" searches
- Often there may have been specific searches conducted / required and the parties may need to further negotiate the types of warranties that should be included and set out in the Details Schedule
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- Ensure you understand the warranties that are required to be given and that you can give these
- Agree with the industry partner if specific patent or other searches need to be undertaken and recorded in the agreement
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- Consider whether additional warranties or searches are appropriate to the particular licence situation and agree these with the university prior to entering the licence
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| Royalties & Licence Fees (Schedule 3) |
- Details of the agreed Fees and/or Royalties should be listed in Schedule 3. The template provisions allow for a basic Fee to be payable on entry into the Agreement, and/or milestone payments, plus the option of an ongoing royalty calculated based on Net Sales
- The definition of Net Sales is indicative only and the parties need to seek their own commercial advice and tax advice for their circumstances to ensure the most appropriate fee and royalty structure for the likely product or service
- The template also allows for adjustments to the Royalty if appropriate – for example where registered rights are not granted
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- Ensure a fair return for the IPR which balances your investment in the IPR and the value being captured by the industry partner
- Consider whether it is appropriate to have parent/financial guarantees to balance the risk of non-payment of fees under the licence. The agreement would need to be amended to provide for this
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- Ensure the fair value being paid for the licence matches the value you gain from access to the IPR, and any additional risks you may be taking to get the technology to market
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| Performance criteria |
- There is provision for minimum performance criteria to be met each year from a nominated commencement date in order for the Licence to remain in force
- Performance criteria may take the form of minimum royalties or licence fees; however other criteria may be more appropriate in the circumstances of the transaction and should be considered (Schedule 4)
- The Licensee is also under further performance guarantees in terms of agreeing not to abandon commercialisation
- The Licensor also has a right to terminate the licence if the Licensee challenge their registered IPRs
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- Ensure appropriate steps are taken by the licensee to develop and commercialise the IPR. This is very important in an exclusive licence
- Any performance criteria need to be appropriate for the scope of licence granted and need to recognise that the licence is exclusive
- Recognise that in some countries the commercial restrictions on the licensee may be anti-competitive and will need to be amended or removed
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- Ensure the agreed performance are appropriate for the scope of the licensed rights and that these are realistic given the stage of development of the IPR
- Consider carefully whether it is appropriate or legally possible to agree to the commercialisation restrictions in the licence
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| Liability cap (Schedule 1) |
- The financial limit agreed for all liabilities under the licence except for those that are specifically uncapped or cannot be limited by law
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- Ensure the agreed liability cap is in line with the value being captured by the licence
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- Ensure the agreed liability cap is in line with the value being captured by the licence and the risks the Licensee is taking to develop the licensed IPR
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| Insurances (Schedule 1) |
- The Licensee is required to hold certain insurances to cover liabilities that may arise under the licence
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- Ensure the agreed insurance levels are appropriate for the size of the company and the nature of its commercialisation under the licence
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- Ensure your insurances meet the required minimum levels agreed with the university
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| Dispute Resolution (Schedule 1) |
- The agreement includes a number of alternative standard approaches to dispute resolution
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- Select the approach that works best for both parties. Most organisations will have a preferred approach
- Legal advice should be sought as to the best mechanism when the other party is a foreign entity
- In the absence of agreement, escalation to court proceedings should be the default
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- Select the approach that works best for both parties. Most organisations will have a preferred approach
- In the absence of agreement, escalation to court proceedings should be the default
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