The License

In order to license University technology, the following items must be addressed:

• Sublicensing Rights
• Diligence Milestones
• Type of License - exclusive or non-exclusive
• Fields of Use - Licenses may be negotiated exclusively by field of use.
• Up-Front Fee - Most licenses require an intial up-front cash payment.
• Patent Costs - The University usually requires reimbursement for all existing and future patent costs for an exclusive license.
• Royalty Rate Structure - Royalty is usually calculated as a percentage of gross sales of patented products less defined allowable costs . Royalty rates can vary considerably.
• Annual Minimum Royalty - Minimum annual payment, to the University, irrespective of commercial success of the licensee.
• Equity - Companies offering an equity position are required to execute a Stock Restriction and Registration Rights Agreement and a Stock Purchase Agreement.

In general, exclusive license agreements are more stringent than non-exclusive licenses.

A sample license agreement can be obtained from OTMIR.