There are several ways that our clients may be compensated for the use of their idea.
If a company licenses a product, it is common business practice for the arrangement to be recorded in a document that all parties can sign and retain. This document is normally a license agreement that by definition is a written understanding between two or more parties concerning the new product idea.
A license agreement provides a clear understanding of the obligations of each party and it also serves as proof of what is owed to each of the parties. Once all parties agree to the terms and sign the agreement, each party receives a copy of the agreement for their records. If at any time there is a dispute between the parties, they may rely upon the license agreement as a statement of their rights and obligations.
Below is a list of terms and conditions that are generally included in the outline of a license agreement.
- Parties to be included in agreement (referred to as the licensee and licensor)
- Description of idea
- Territory rights
- Intellectual property rights
- Obligations of licensor
- Obligations of licensee
- Quarterly statements
- Books and records
- Independent parties / indemnification
- Sub-licenses, assignments
At Davison, we have the knowledge and experience to successfully negotiate license agreements. Without a license agreement in place, serious issues could arise after negotiations. A simple handshake is no longer sufficient to seal a business deal.
If your goal is to have your idea prepared and presented to a corporation in the hope of getting a license agreement, we recommend that you fill out our free information form and we will send you information on how to get started.