Royalty Share Agreement Template for Malaysia

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Key Requirements PROMPT example:

Royalty Share Agreement

"I need a Royalty Share Agreement for a software development company in Malaysia licensing its AI technology to a manufacturing partner, with quarterly payments and a 15% royalty rate on net sales, to commence from March 2025."

Document background
The Royalty Share Agreement is a crucial document used when parties wish to establish a formal arrangement for sharing revenue generated from intellectual property exploitation in Malaysia. It is particularly relevant when IP owners want to monetize their assets while maintaining ownership rights, or when businesses seek to legally utilize and commercialize intellectual property owned by others. The agreement must comply with Malaysian legislation, including the Contracts Act 1950, Income Tax Act 1967, and relevant intellectual property laws. It typically includes detailed provisions for royalty calculations, payment mechanisms, reporting obligations, audit rights, and dispute resolution procedures. This document is essential for protecting both the IP owner's rights and the commercial interests of the exploiting party, while ensuring clear revenue sharing arrangements and compliance with local regulations.
Suggested Sections

1. Parties: Identification and details of all parties to the agreement

2. Background: Context of the agreement, relationship between parties, and purpose of the arrangement

3. Definitions: Detailed definitions of key terms used throughout the agreement

4. Grant of Rights: Specific rights being granted regarding the intellectual property or assets

5. Calculation of Royalties: Formula and methodology for calculating royalty shares

6. Payment Terms: Timing, method, and currency of royalty payments

7. Reporting Requirements: Details of sales reports, accounting records, and financial statements required

8. Audit Rights: Rights and procedures for auditing royalty calculations and payments

9. Intellectual Property Protection: Obligations regarding IP protection, registration, and enforcement

10. Confidentiality: Protection of confidential information shared between parties

11. Term and Termination: Duration of agreement and circumstances for termination

12. Governing Law and Jurisdiction: Applicable law and courts for dispute resolution

13. General Provisions: Standard boilerplate clauses including notices, assignment, and amendments

Optional Sections

1. Minimum Guarantee: Include when there's a minimum royalty payment requirement regardless of actual sales

2. Territory Restrictions: Add when the rights are limited to specific geographic regions

3. Quality Control: Include for agreements involving trademarks or brand reputation

4. Sub-licensing Rights: Add when sub-licensing is permitted and needs regulation

5. Marketing and Promotion: Include when parties have specific marketing obligations

6. Development Obligations: Add for agreements involving ongoing product development

7. Competition Restrictions: Include when there are non-compete or exclusivity provisions

8. Tax Provisions: Add detailed tax handling when cross-border payments are involved

9. Force Majeure: Include when specific events should excuse performance

Suggested Schedules

1. Schedule 1 - Licensed Property: Detailed description of intellectual property or assets covered

2. Schedule 2 - Royalty Rates: Detailed breakdown of royalty percentages and tiers

3. Schedule 3 - Calculation Examples: Examples of royalty calculations in various scenarios

4. Schedule 4 - Reporting Template: Standard format for regular royalty reports

5. Schedule 5 - Territory Definition: Detailed description of geographic territories if applicable

6. Schedule 6 - Quality Standards: Specific quality requirements and standards if applicable

7. Appendix A - Initial Business Plan: If required, projected sales and revenue expectations

8. Appendix B - Approved Sub-licensees: List of pre-approved sub-licensees if applicable

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

Relevant legal definitions
Clauses
Relevant Industries

Technology

Media & Entertainment

Publishing

Manufacturing

Pharmaceuticals

Biotechnology

Software Development

Fashion & Retail

Music Industry

Gaming

Research & Development

Consumer Products

Relevant Teams

Legal

Finance

Business Development

Intellectual Property

Commercial

Licensing

Revenue Management

Business Affairs

Partnerships

Compliance

Relevant Roles

Legal Counsel

Intellectual Property Manager

Business Development Director

Finance Director

Commercial Manager

Licensing Manager

Contract Administrator

Chief Financial Officer

Chief Legal Officer

IP Rights Manager

Royalty Administrator

Business Affairs Manager

Partnership Manager

Revenue Manager

Industries
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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