IP licence agreement

Of technical product in a single industry or market
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Document overview

This is a heavyweight licence agreement for rights in an invention. It could be any technical IP. This agreement is for an invention or improvement which could be used in more than one industry. The owner/inventor will licence it widely, but to only one licensee per industry or sector. The Licence is perpetual, irrevocable, non-exclusive, fully paid-up, royalty-free and worldwide. The licensee is therefore entirely free to incorporate it into any product he makes, provided it is in his industry only. Includes more limited licence for supporting IP - maybe a patent or trade mark or the right to some system or device. It is also assumed that the licensee will require a licence to use supporting systems, in common with other licensees.
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  • Length:20 pages (5600 words)
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About this licence agreement

This is a heavy weight licence agreement for rights in an invention. In the document we have named it “Hamlet”. Hamlet could be any technical IP. It is more likely to be some small widget than a ready-to-sell product.

You may be an individual or represent a company. You have devised and produced an invention or technological innovation. It may be applicable in one industry or many. It could be anything. You want to license it to a major manufacturer in a particular industry.

Examples of the wide range of applications are:

Example 1: carpet manufacturer invents new way to cut and mould carpet shapes to a room in one piece. Licenses idea to car maker who patents it for use in cars, but in name of licensor.

Example 2: drugs company invents new anti-coagulant for blood. Licences it to construction chemicals company to improve hardener in fast-set concrete.

Example 3: sub-marine camera specialist invents waterproof lens cap and licenses it to small manufacturer of extreme sports gear for use in high altitude safety gear.

Example 4: lawyer invents software for law document assembly system and licences it to architect to make similar application for his profession.

It is assumed that the invention could be used in more than one industry. The owner/inventor will licence it widely, but to only one licensee per industry or sector. The Licence is perpetual, irrevocable, non-exclusive, royalty-free and worldwide. That is to say the licensee never has to look back. He can use it for ever, provided he sticks to his industry sector.

The licensee also gets a secondary licence to some sort of supporting intellectual property. This is most likely a trade mark, a patent or maybe only the right to use a name or logo. However, your product or device or invention might rely on a support system which requires slightly different licence terms because it may be used by others. You will upgrade it from time to time. That right is also perpetual but it is limited so that the licensor can allow others to use it too.

There are two reasons why you might wish to protect this additional material more strongly:

  • First, it may have far wider application and you will wish to use it in the same market for other applications, or in other products and other markets;
  • The second reason is that you may not own all the supporting material. You may yourself use some IP which he has licensed to you from others. The best he can do with that IP is to make sure you are allowed to sub-license it, then do just that.

You choose the exact deal you want in this agreement. You are always in control. You can choose the term during which the deal is to run, the type of merchandising you allow, the territory in which a product can be sold, minimum quality of goods and more. Each of these is the subject of a separate sub paragraph, for easy edit by you. You can choose “in” or “out” or edit.

This agreement covers your intellectual property rights in every aspect of your work: design drawings, copyright, software, patents and more. It provides for a single payment up front.

This agreement provides the complete legal framework for what may appear to be a complicated deal. The Net Lawman modular structure in plain English takes you smoothly through the detail of a document of over 5,000 words.

Key features

  • Professionally drawn, tough law
  • Easy to edit (as always with Net Lawman documents)
  • Thorough coverage of legal areas
  • Practical, alternative business provisions
  • No requirement for you to be your own lawyer

Alternatives to this licence agreement

Net Lawman offers around 20 licence agreements and assignments relating to intellectual property in addition to those in website terms and conditions.
You can find the full selection at:

Contents of this licence agreement

It is impossible to explain a six thousand word document in a few lines, but here is a list of the major subjects covered:

  • Definitions and interpretation
  • Warranties and understandings
  • Licensor’s representations about the subject matter
  • The Licence deal
  • Licence of supporting IP
  • Limited sub-licence
  • Use of third party IP
  • Protection of licensed material
  • New intellectual property and derived products
  • Third party infringement
  • Confidentiality
  • Indemnities
  • Other matters relating to enforcement and other legal issues

Over 1,550 words of helpful drafting note.

Sample ip licence agreementFront cover

Recent reviews

21 September 2018
Grant Allan
Review of the New Zealand version
Missing Some Protection
28 April 2021
Was a good, clear document with good detailed instructions. Was missing a few added points from the perspective of the Licensee. I wanted to provide more protection for the Licensee but the agreement was skewed towards the Licensor. It would have been excellent if added Licensee points were included in the document or a seperate attachment as points for consideration. Also specific instructions (process etc) as to warehousing of IP in case of eg bankruptcy of Licensor would have been useful.
Khaldoun Shehadeh
Review of the United Kingdom version

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