Exclusive Licensing

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This License Agreement, effective upon the date of last signature herein and payment of the License Issue Fee in Paragraph 3.1 (the "Effective Date"), by and between The Penn State Research Foundation (hereinafter referred to as "PSRF"), a non-profit corporation duly organized and existing under the laws of the Commonwealth of Pennsylvania and having an office at 304 Old Main, University Park, PA 16802, and ______________________, a corporation organized under the laws of the State of ___________ (hereinafter referred to as "LICENSEE"), having its principal office at _____________________.  Each of PSRF and LICENSEEE may be referred to individually as a "party" and collectively as "parties".

WITNESSETH

     WHEREAS, _____________________, employees of The Pennsylvania State University (the "UNIVERSITY") have made an invention entitled "_______________________________", filed as UNIVERSITY Invention Disclosure No. ________ (the "INVENTION");

    WHEREAS, PSRF is dedicated to fostering and advancing scientific research and economic growth within the Commonwealth of Pennsylvania and, in particular, within the UNIVERSITY and is responsible for developing inventions made by employees of the UNIVERSITY by evaluating invention disclosures, pursuing patents, and pursuing licensing arrangements thereon;

    WHEREAS, PSRF is the owner of certain "PATENT RIGHTS" (as defined hereinbelow) relating to INVENTION and has the right to grant licenses under PATENT RIGHTS; and

    WHEREAS, LICENSEE desires to acquire a license to certain PATENT RIGHTS for commercialization of a LICENSED PRODUCT (and defined hereinbelow).

    NOW THEREFORE, in consideration of the mutual promises and covenants set forth herein and for good and valuable consideration, the adequacy and sufficiency of which is hereby acknowledged, the parties hereby agree as follows:

ARTICLE I - DEFINITIONS

     For purposes of this License Agreement, the following words and phrases shall have the following meanings:

    1.1    "LICENSEE" shall be _________________.

    1.2    "FIELD" shall mean ____________________.

    1.3    "TERRITORY" shall mean _____________________.

    1.4    "PATENT RIGHTS" shall mean without limitation U.S. Patent No. _________________, issued on ________________.

    1.5    "LICENSED PRODUCT" shall mean any process, product or part thereof, or use of a product or part thereof, which is covered in whole or in part by at least one unexpired claim of PATENT RIGHTS in the country in which any such process, product or part thereof is made, used, or sold.

ARTICLE II - THE LICENSE

     2.1    Subject to any preexisting rights, if any, of the Government of the United States created by the use of Government funding and subject to the payment of the License Issue Fee in Paragraph 3.1, PSRF hereby grants to LICENSEE an exclusive right and license in the TERRITORY for the FIELD, with right to sublicense, to PATENT RIGHTS and to the extent not prohibited by other patents, to make, have made, use, lease, and sell LICENSED PRODUCTs for the term set forth herein, unless this License Agreement shall be earlier terminated according to the terms and conditions contained herein.

    2.2    PSRF reserves the rights for itself and the UNIVERSITY to practice under the PATENT RIGHTS for their own research and educational purposes.

    2.3    LICENSEE agrees that LICENSED PRODUCTs leased or sold in the United States will be manufactured substantially in the United States. Certain PATENT RIGHTS resulted from federally-supported research, and their assignment is governed by the applicable provisions of the federal funding agreements, including the 35 USC Chapter 18 (the “Bayh-Dole Act”), 37 CFR Part 401.

    2.4    The license rights granted hereunder shall not be construed to confer any rights upon LICENSEE by implication, estoppel or otherwise to any technology owned or controlled by PSRF which is not specifically set forth herein.

ARTICLE III - PAYMENTS

     3.1    LICENSEE shall pay to PSRF a non-refundable, one-time, up-front, License Issue Fee of ____________________ dollars ($_________) upon execution of this License Agreement.  This License Agreement shall not be effective until the payment of this License Issue Fee.

3.2    All payments due hereunder are expressed in and shall be paid by check payable in United States of America currency, without deduction of exchange, collection or other charges, to PSRF in University Park, PA or at such other place as PSRF may reasonably designate. 

3.3    For converting into United States dollars any payment accrued hereunder in the currency of any other country, the rate of exchange for the purchase of United States dollars with such currency quoted by The Chase Manhattan Bank, New York, New York, on the last business day of the payment period in question shall be used.

ARTICLE IV - MARKETING EFFORTS

     4.1    LICENSEE shall use reasonable efforts to diligently bring one or more LICENSED PRODUCTS into the commercial market as soon as practicable and to continue active, diligent marketing efforts for one or more LICENSED PRODUCTS throughout the term of this License Agreement.  Failure to demonstrate reasonable efforts to bring one or more LICENSED PRODUCTS into the commercial market by the LICENSEE shall be considered a material breach under Paragraph 13.5 of this License Agreement.

ARTICLE V - PATENT MAINTENANCE

     5.1    The United States Patent and Trademark Office (“USPTO”) patent maintenance fees are due 3.5, 7.5 and 11.5 years after a U.S. patent issues.  LICENSEE is responsible for the payment of patent maintenance fees and associated legal fees.  LICENSEE shall timely communicate to PSRF its decision to pay or not to pay patent maintenance fees.  LICENSEE shall notify PSRF no later than sixty (60) days before patent maintenance fee due dates.  In the event LICENSEE decides not to pay patent maintenance fees, LICENSEE shall timely notify PSRF in writing in order that PSRF may pay patent maintenance fees at its own expense.  This License Agreement shall terminate immediately upon LICENSEE’s notification to PSRF of LICENSEE’s decision not to pay any patent maintenance fee.  This License Agreement shall terminate immediately if LICENSEE does not respond to PSRF regarding the payment of any patent maintenance fee sixty (60) days prior to the payment due date regardless of the USPTO’s surcharge date.

ARTICLE VI - INFRINGEMENT AND OTHER ACTIONS

     6.1    LICENSEE shall promptly provide written notice to PSRF of any alleged infringement by a third party of any patent licensed hereunder under PATENT RIGHTS and provide PSRF  with any available evidence of such infringement.

    6.2    During the term of the License Agreement, PSRF shall have the initial right, but not the obligation, to prosecute and/or defend, at its own expense and utilizing counsel of its choice, any infringement of, and/or challenge to, the PATENT RIGHTS.  In furtherance of such right, LICENSEE hereby agrees that PSRF may join LICENSEE as a party in any such suit, without expense to LICENSEE.  The total cost of any such action, commenced or defended solely by PSRF, shall be borne by PSRF, which shall keep any recovery or damages derived therefrom.  Failure of LICENSEE to provide PSRF with this initial right shall be considered a material breach of this Licensee Agreement subject to Paragraph 13.5 below.

    6.3    If within six (6) months after having been notified of any alleged infringement, PSRF shall have been unsuccessful in persuading the alleged infringer to desist and shall not have brought and shall not be diligently prosecuting an infringement action, or if PSRF shall notify LICENSEE at any time prior thereto of its intention not to bring suit against any alleged infringer in the TERRITORY for the FIELD and LICENSEE has been unsuccessful in securing a reasonable sublicense with the alleged infringer, then, and in those events only, LICENSEE shall have the right, but not the obligation, at its own expense and utilizing counsel of its choice, to prosecute any infringement of, and/or defend any challenge to, the PATENT RIGHTS, provided that LICENSEE is developing or selling a LICENSED PRODUCT during the exclusive period of this License Agreement.  LICENSEE’s right to prosecute any infringement of, and/or defend any challenge to, the PATENT RIGHTS is subject to approval by PSRF, which shall not be unreasonably withheld, that LICENSEE is indeed actively developing or selling a LICNESED PRODUCT.  LICENSEE may, for such purposes, join PSRF as a party plaintiff; provided, however, that such right to bring such an infringement action shall remain in effect only for so long as the license granted herein remains exclusive. No settlement, consent judgment or other voluntary, final disposition of the suit may be entered into without the consent of PSRF, which consent shall be timely given and not unreasonably be withheld.  LICENSEE agrees to keep PSRF reasonably informed as to the status of any such action and to provide copies to PSRF, upon request by PSRF, of any papers or information relevant to the prosecution of any such action.  LICENSEE shall timely inform PSRF of any offer for settlement presented by a third party for any such action and LICENSEE shall consider PSRF's input in deciding whether or not to accept any such settlement offer.  The total cost of any such action commenced or defended solely by LICENSEE shall be borne by LICENSEE.

    6.4    In the event that LICENSEE shall undertake the enforcement and/or defense of the PATENT RIGHTS, as provided in Paragraph 6.3, any recovery of damages by LICENSEE for each such suit shall be applied first in satisfaction of any unreimbursed expenses and legal fees of LICENSEE relating to such suit. The balance remaining from any such recovery shall be divided equally between LICENSEE and PSRF.

    6.5    In the event that a declaratory judgment action alleging invalidity or noninfringement of any of the PATENT RIGHTS shall be brought against LICENSEE, PSRF, at its option, shall have the right, within (30) days after commencement of such action, to intervene and take over the sole defense of the action at its own expense.

    6.6    In any infringement suit as either party may institute to enforce the PATENT RIGHTS pursuant to this License Agreement, the other party hereto shall, at the request and expense of the party initiating such suit, cooperate in all respects and, to the extent possible, have its employees testify when requested and make available relevant records, papers, information, samples, specimens, and the like.

    6.7    LICENSEE, during the exclusive period of this License Agreement, shall have the sole rights in accordance with the terms and conditions herein to sublicense any alleged infringer in the TERRITORY for the FIELD for future use of the PATENT RIGHTS. 

    6.8     LICENSEE shall not and will not threaten to prosecute any alleged infringement or initiate patent infringement litigation against a start-up company or end-user unless either directly competes against the LICENSEE.

ARTICLE VII - INDEMNIFICATION

     7.1    LICENSEE shall at all times during the term of this License Agreement and thereafter, indemnify, defend and hold PSRF, its trustees, directors, officers, employees and affiliates, harmless against all claims, proceedings, demands and liabilities of any kind whatsoever, including legal expenses and reasonable attorneys' fees, arising out of the death of or injury to any person or persons, any damage to property, or any other claim that results from the production, manufacture, sale, use, lease, consumption or advertisement of the LICENSED PRODUCTs or arising from any rights or obligation of LICENSEE hereunder.

    7.2    Prior to the first commercial sale of a LICENSED PRODUCT, LICENSEE shall obtain and carry in full force and effect commercial, general liability insurance which shall protect LICENSEE and PSRF with respect to events covered by Paragraph 7.1 above.  Such insurance shall be written by a reputable insurance company authorized to do business in the Commonwealth of Pennsylvania, shall list PSRF and The Pennsylvania State University as an additional insured thereunder, shall include product liability coverage and shall require thirty (30) days written notice to be given to PSRF prior to any cancellation or material change thereof.  The limits of such insurance shall not be less than One Million Dollars ($1,000,000) per occurrence with an aggregate of Three Million Dollars ($3,000,000).  LICENSEE shall provide PSRF with Certificates of Insurance evidencing the same.

    7.3    EXCEPT AS OTHERWISE EXPRESSLY SET FORTH IN THIS LICENSE AGREEMENT, PSRF, ITS TRUSTEES, DIRECTORS, OFFICERS, EMPLOYEES, AND AFFILIATES MAKE NO REPRESENTATIONS AND EXTEND NO WARRANTIES OF ANY KIND, EITHER EXPRESS OR IMPLIED, INCLUDING BUT NOT LIMITED TO WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, VALIDITY OF PATENT RIGHTS CLAIMS, ISSUED OR PENDING, AND THE ABSENCE OF LATENT OR OTHER DEFECTS, WHETHER OR NOT DISCOVERABLE.  NOTHING IN THIS LICENSE AGREEMENT SHALL BE CONSTRUED AS A REPRESENTATION MADE OR WARRANTY GIVEN BY PSRF THAT THE PRACTICE BY LICENSEE OF THE LICENSE GRANTED HEREUNDER SHALL NOT INFRINGE THE PATENT RIGHTS OF ANY THIRD PARTY.  IN NO EVENT SHALL PSRF, ITS TRUSTEES, DIRECTORS, OFFICERS, EMPLOYEES AND AFFILIATES BE LIABLE FOR INCIDENTAL OR CONSEQUENTIAL DAMAGES OF ANY KIND, INCLUDING ECONOMIC DAMAGE OR INJURY TO PROPERTY AND LOST PROFITS, REGARDLESS OF WHETHER PSRF SHALL BE ADVISED, SHALL HAVE OTHER REASON TO KNOW, OR IN FACT SHALL KNOW OF THE POSSIBILITY.

ARTICLE VIII - EXPORT CONTROLS

     8.1    The LICENSED PRODUCT is U.S. technology developed, conceived or otherwise originating in the U.S. and, as such, is subject to the regulatory control of the U.S. Government for export control purposes.  LICENSEE hereby acknowledges that its use of the LICENSED PRODUCT is governed by any and all relevant and applicable export control laws, regulations or guidelines of the United States, and, where applicable, any and all similar laws of any foreign country under whose jurisdiction Licensee may fall.  These laws, regulations and guidelines may prohibit, or require a license for, the export of certain types of hardware, commodities, technical data and/or services to certain specified countries, or to the nationals of such countries.

    8.2    PSRF makes no representation, warranty or other determination that LICENSEE use of the LICENSED PRODUCT shall or shall not require any export licenses or approvals nor that, if required, any such licenses or approvals shall be issued.  LICENSEE shall be solely responsible for the determination to seek or obtain any licenses or approvals and for the payment of all reasonable costs attendant to securing said licenses or approvals. 

    8.3    LICENSEE hereby agrees and gives written assurance that, in its exercise of its rights under this License Agreement, LICENSEE will comply with all applicable United States laws and regulations controlling the export of hardware, commodities, technical data and/or services. 

    8.4    LICENSEE shall include language substantially similar to the language in this Article VIII in any and all sublicensing agreements or other transfer documents which it prepares or executes in the use of the LICENSED PRODUCT.

    8.5    LICENSEE acknowledges and agrees that any violation of its obligations under this Article VIII shall be deemed a material breach of this License Agreement under Paragraph 13.5 below.

ARTICLE IX - NON-USE OF NAMES

     9.1    LICENSEE shall not use the names, images or trademarks of The Pennsylvania State University, PSRF, or any of their employees, or any adaptation thereof, in any advertising, promotional, securities, or sales literature without prior written consent obtained from PSRF, in each case, except that LICENSEE may, without prior written consent, state that it is licensed by PSRF, under one or more of the patents comprising the PATENT RIGHTS.

ARTICLE X- PAYMENTS, NOTICES AND OTHER COMMUNICATIONS

     10.1 Any payment, notice or other communication pursuant to this License Agreement shall be sufficiently made or given on the date of mailing if sent to such party by certified or registered first class mail, postage prepaid, addressed to it at its address below or as it shall designate by written notice given to the other party as follows:

In the case of THE PENN STATE RESEARCH FOUNDATION:

President
The Penn State Research Foundation
c/o Office of Technology Management
113 Technology Center
University Park, PA  16802-7000

In the case of LICENSEE:   

_________________________
_________________________
_________________________
_________________________

ARTICLE XI - ASSIGNMENT

    11.1    This License Agreement shall not be assignable by either party without the prior written consent of the other party, provided however, that LICENSEE may assign this License Agreement in whole either in connection with the sale or transfer of all or substantially all of LICENSEE’s assets to which this License Agreement relates or by a bona fide merger of LICENSEE with another entity if assignee entity agrees in writing to PSRF to be bound by the terms and conditions of this License Agreement and the payment of a Five Thousand Dollar (US $5,000.00) fee to PSRF.

ARTICLE XII - DISPUTE RESOLUTION

     12.1    Except for the right of either party to apply to a court of competent jurisdiction for a temporary restraining order, a preliminary injunction, or other equitable relief to preserve the status quo or prevent irreparable harm, any and all claims, disputes or controversies arising under, out of, or in connection with this License Agreement, including any dispute relating to patent validity or infringement, which the parties shall be unable to resolve within sixty (60) days, shall be mediated in good faith.  The party raising such dispute shall promptly advise the other party of such claim, dispute or controversy in a writing which describes in reasonable detail the nature of such dispute.  By not later than five (5) business days after the recipient has received such notice of dispute, each party shall have selected for itself a representative who shall have the authority to bind such party, and shall additionally have advised the other party in writing of the name and title of such representative.  By not later than ten (10) business days after the date of such notice of dispute, the party against whom the dispute shall be raised shall select a mediation firm in Pennsylvania and such representatives shall schedule a date with such firm for a mediation hearing.  The parties shall enter into good faith mediation and shall share the costs equally.  If the representatives of the parties have not been able to resolve the dispute within fifteen (15) business days after such mediation hearing, the parties shall have the right to pursue any other remedies legally available to resolve such dispute in either the Centre County Court of Common Pleas or in the United States District Court for the Middle District of Pennsylvania, to whose jurisdiction for such purposes PSRF and LICENSEE each hereby irrevocably consents and submits.

    12.2    Notwithstanding the foregoing, nothing in this Article XII shall be construed to waive any rights or timely performance of any obligations existing under this License Agreement.

ARTICLE XIII - TERM AND TERMINATION

      13.1    LICENSEE shall have the right to terminate this License Agreement at any time on six (6) months’ notice to PSRF, and upon payment of all amounts due PSRF through the effective date of the termination.

    13.2    Unless earlier terminated as hereinafter provided, this License Agreement shall continue until the end of the life of the last to expire patent of PATENT RIGHTS.

    13.3    Financial Solvency of LICENSEE.  LICENSEE agrees that as a part of its material inducement to PSRF to enter this License Agreement, it shall provide PSRF with at least ninety (90) days written notice hereunder of its intent to file a petition in Bankruptcy, whether it be for a Chapter 7, 11, 13 or any other such petition.  LICENSEE agrees and understands that PSRF has an obligation to University, a land grant institution under the Morrell Act, to license the PATENT RIGHTS pursuant to terms and conditions which maximize the public benefit.  PSRF shall have the right to immediately terminate this License Agreement by giving written notice to LICENSEE, in the event LICENSEE does any of the following: a) provides notice hereunder of its intent to file (or does actually file without providing said notice) a petition in bankruptcy, b) attempts to make an assignment hereof for the benefit of creditors, c) discontinues or dissolves its business, or d) if a receiver is appointed for LICENSEE.

    13.4    Financial Breach.  In the event LICENSEE has breached its obligations to reimburse PSRF per Article V of this License Agreement, (hereafter “Financial Breach”) PSRF shall provide LICENSEE with written notice of said breach, and LICENSEE shall have a period of thirty (30) days to cure said breach.  In the event LICENSEE does not fully cure the breach within that thirty (30) day period, and fails within that thirty (30) days to commence mediation pursuant to Article XII of this License Agreement alleging grounds for its non-payment thereof, this License Agreement shall be automatically terminated without further notice or action by PSRF.  Notwithstanding LICENSEE’s rights to cure herein, in the event LICENSEE commits a Financial Breach more than two times within any calendar year within the term of this License, PSRF shall be entitled to give notice of breach which shall become effective immediately upon LICENSEE’s receipt of said Notice, and for which LICENSEE shall not have any further right of “cure.”

    13.5    Failure of Other Performance.  Upon any material breach of performance under this License Agreement, by LICENSEE, other than those occurrences set out in Paragraphs 13.3 or 13.4 hereinabove, which shall always take precedence in that order over any material breach or default referred to in this Paragraph 13.5, PSRF shall have the right to terminate this License Agreement and the rights, privileges and license granted hereunder effective sixty (60) days after PSRF first notifies LICENSEE of the alleged breach under the notice provisions contained in Article X of this License Agreement.  As used in this License Agreement, the term “Material Breach of Performance” shall include, but not be limited to the following:  breach of due diligence provisions in Article IV, failure to notify PSRF of infringement, improper or unauthorized assertion of PATENT RIGHTS, failure to assume duty to indemnify and defend, failure to provide adequate levels of insurance, and attempt to improperly assign rights hereunder.  Such termination shall become effective upon final notification by PSRF after the sixty (60) days, unless LICENSEE shall have fully cured any such material breach or default prior to the expiration of the sixty (60) day period.  In the event of a dispute as to whether LICENSEE has cured the alleged breach, the matter shall be resolved pursuant to Article XII of this License Agreement.

13.6    Upon termination of this License Agreement for any reason, nothing herein shall be construed to release either party from any obligation that matured prior to the effective date of such termination; and Articles I, VIII, IX, X, XV and paragraphs 13.5 and 13.6 shall survive any such termination.  LICENSEE may, however, after the effective date of such termination, sell all LICENSED PRODUCTs, and complete LICENSED PRODUCTs in the process of manufacture at the time of such termination and sell the same.
   

ARTICLE XIV - MISCELLANEOUS PROVISIONS

     14.1    Entire Agreement.  This License Agreement embodies the entire understanding of the parties and shall supersede all previous communications, representations, or undertakings, either verbal or written, between the parties relating to the subject matter hereof.

    14.2    Amendment.  This License Agreement may be amended only by a written agreement embodying the full terms of the amendment signed by authorized representatives of both parties.

    14.3    Severability.  Should any provision of this License Agreement be held to be illegal, invalid or unenforceable, by any court of competent jurisdiction, such provision shall be modified by such court in compliance with the law and, as modified, enforced.  The remaining provisions of this License Agreement shall be construed in accordance with the modified provision and as if such illegal, invalid or unenforceable provision had not been contained herein.

    14.4    No Strict Construction.  The language used in this License Agreement shall be deemed to be the language chosen by both parties hereto to express their mutual intent and no rule of strict construction against either party shall apply to any term or condition of this License Agreement.

    14.5    Relationship of Parties.  Nothing contained in this License Agreement shall be construed as creating a partnership, joint venture, agency or an association of any kind.

    14.6    No Waiver.  The failure of one party hereto to enforce at any time any of the provisions of this License Agreement, or any rights in respect thereto, or to exercise any election herein provided, shall in no way be considered to be a waiver of such provision, rights or elections or in any way to affect the validity of this License Agreement, or excuse a similar subsequent failure to perform any such term or condition by the other party.  Any waiver must be in writing.

    14.7    Interpretation.  The headings of several sections contained herein are inserted for convenience of reference only, and are not intended to be a part of or to affect the meaning or interpretation of this License Agreement.

    14.8    Governing Law.  This License Agreement shall be governed by and construed in accordance with the laws of the Commonwealth of Pennsylvania without giving effect to any choice of law or conflict of law provision or rule that would cause the application of the laws of any jurisdiction other than the Commonwealth of Pennsylvania, except that questions affecting the construction and effect of any patent shall be determined by the law of the country in which the patent was granted.

    14.9    Product Marking.  LICENSEE agrees to mark the LICENSED PRODUCTs sold in the United States with all applicable United States patent numbers.  All LICENSED PRODUCTs shipped to or sold in other countries shall be marked in such a manner as to conform with the patent laws and practices of the country of manufacture or sale.

IN WITNESS WHEREOF, the parties hereto, intending to be legally bound hereby, have each caused a duly authorized representative to execute this License Agreement on the day and year set forth below.


________________________________
(LICENSEE)   

By:    _____________________________________
Name:    __________________________________
Title:    ____________________________________
Date:    ___________________________________

THE PENN STATE RESEARCH FOUNDATION
(PSRF)

By:    _____________________________________
Name:    __________________________________
Title:    ____________________________________
Date:    ___________________________________