Licence Agreement Term Sheet Generator for England and Wales

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Key Requirements PROMPT example:

Licence Agreement Term Sheet

"I need a Licence Agreement Term Sheet for licensing our new AI software technology to a European distributor, with exclusive rights in Germany and France, including provisions for revenue-based royalties and minimum performance targets starting from March 2025."

Document background
A Licence Agreement Term Sheet is commonly used when parties are negotiating the commercial terms of an intellectual property licence but aren't yet ready to proceed with full documentation. Under English and Welsh law, this document typically precedes the main licence agreement and helps parties align on fundamental terms including rights granted, territorial scope, duration, and financial arrangements. The term sheet format allows for efficient negotiation of key points without the immediate need for comprehensive legal documentation, though certain provisions may be made binding. It's particularly valuable in complex licensing arrangements where significant commercial terms need to be agreed before proceeding with detailed legal work.
Suggested Sections

1. Parties: Identification and details of the licensor and licensee

2. Background: Context of the agreement and ownership of relevant IP rights

3. Definitions: Key terms used throughout the term sheet

4. Subject Matter: Description of the IP rights being licensed

5. Licence Grant: Scope and nature of the licence (exclusive/non-exclusive)

6. Territory: Geographical scope of the licence

7. Duration: Term of the licence and renewal provisions

8. Financial Terms: Licensing fees, royalties, and payment terms

Optional Sections

1. Minimum Performance Requirements: Used when licensor wants to ensure minimum revenue or performance targets are met by the licensee

2. Sub-licensing Rights: Rights and conditions for the licensee to grant sub-licences to third parties

3. Improvements: Rights and obligations relating to improvements to the licensed IP

4. Technical Support: Provisions for technical support and maintenance from licensor

Suggested Schedules

1. Schedule 1 - Licensed IP: Detailed description and specification of the intellectual property being licensed

2. Schedule 2 - Commercial Terms: Detailed financial terms, royalty calculations and payment schedules

3. Schedule 3 - Technical Specifications: Technical details and specifications of licensed technology or products

4. Schedule 4 - Quality Standards: Quality requirements, control procedures and compliance standards

Authors

Alex Denne

Head of Growth (Open Source Law) @ Genie AI | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Clauses
Industries

Copyright, Designs and Patents Act 1988: Primary legislation governing copyright, design rights, and patents in the UK, essential for defining the intellectual property rights being licensed

Trade Marks Act 1994: Key legislation for trademark protection and licensing in the UK, including provisions for trademark registration and enforcement

Patents Act 1977: Fundamental legislation governing patent rights and their exploitation through licensing in the UK

Registered Designs Act 1949: Legislation covering the registration and protection of industrial designs, relevant for design-related licensing

Common Law Contract Principles: Fundamental principles governing contract formation, including offer, acceptance, consideration, and intention to create legal relations

Misrepresentation Act 1967: Legislation dealing with false statements made during contract negotiation, affecting the validity of license agreements

Unfair Contract Terms Act 1977: Controls the use of exclusion and limitation clauses in contracts, including license agreements

Consumer Rights Act 2015: Key legislation for B2C licensing, ensuring fair terms and consumer protection in licensing agreements

Competition Act 1998: Regulates anti-competitive behavior and ensures license agreements don't restrict market competition

Technology Transfer Block Exemption Regulation: Provides safe harbor for certain IP licensing agreements from competition law restrictions

UK GDPR: Post-Brexit data protection regulation governing the processing of personal data, relevant for licenses involving data transfer

Data Protection Act 2018: UK's implementation of data protection standards, complementing UK GDPR provisions

Financial Services and Markets Act 2000: Regulatory framework for financial services, relevant for licensing in the financial sector

Value Added Tax Act 1994: Legislation governing VAT implications of license fees and royalty payments

International IP Treaties: Various international agreements protecting IP rights across borders, affecting international licensing

Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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