Think Kodak, think license agreement

17 June 2012

Several articles in international newspapers about Kodak, being under Chapter 11, indicate that it has touched almost 3 billion USD on license fees for its patent portfolio. It made us realize the importance of well-drafted license agreements. One of the most important clauses of a license agreement is the ‘payment conditions’ clause. A compensation will be received by the licenser as a trade for this license. The compensation may consist of several elements: an up-front payment to be paid by the licensee by signing the agreement between both parties; a royalty that depends from the turnover or profit rate gained by sale; mile-stone payments to be paid by the licensee at previously pointed dates, for example when reaching a certain point in the process from innovation till market product. This also protects the licensee against a valueless patent. It is advisable to contact IP Hills, also known as a specialist in IP legal opinion, for drafting or reviewing your license agreement.

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