Perpetual Royalty License for Malta

Perpetual Royalty License Template for Malta

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Perpetual Royalty License

"I need a Perpetual Royalty License agreement under Maltese law for licensing our proprietary software platform to a German technology company, with rights to sublicense in the EU and a 5% royalty rate on net sales, expected to commence March 1, 2025."

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What is a Perpetual Royalty License?

The Perpetual Royalty License agreement is a specialized legal instrument used when parties seek to establish a permanent licensing arrangement for intellectual property rights under Maltese law. This document is particularly suitable for situations where the licensor wishes to maintain ownership of their intellectual property while granting permanent usage rights to the licensee in exchange for ongoing royalty payments. It includes comprehensive provisions for royalty calculations, payment terms, quality control, reporting requirements, and IP protection measures, all structured to comply with Maltese legal requirements and EU regulations. The agreement is designed to provide long-term certainty while protecting both parties' interests through clear obligations and rights, making it particularly valuable for technology transfers, manufacturing arrangements, and other long-term commercial relationships involving intellectual property.

What sections should be included in a Perpetual Royalty License?

1. Parties: Identification of the licensor and licensee, including full legal names, registration details, and addresses

2. Background: Context of the agreement, description of the intellectual property being licensed, and the parties' intentions

3. Definitions: Detailed definitions of key terms used throughout the agreement, including 'Licensed IP', 'Territory', 'Royalties', and 'Net Sales'

4. Grant of License: Explicit grant of the perpetual license, including scope, territory, and any field-of-use restrictions

5. Royalty Obligations: Detailed provisions for calculation, reporting, and payment of royalties, including payment terms and currency

6. Quality Control: Standards and requirements for use of the licensed IP, including approval processes and maintenance of quality

7. Records and Audit Rights: Requirements for maintaining records, reporting obligations, and the licensor's audit rights

8. Representations and Warranties: Warranties regarding IP ownership, right to license, non-infringement, and other standard warranties

9. Protection and Enforcement: Obligations regarding IP protection, enforcement against infringers, and cooperation requirements

10. Confidentiality: Provisions protecting confidential information exchanged under the agreement

11. Term and Termination: Despite perpetual nature, conditions for termination for breach and consequences of termination

12. Governing Law and Jurisdiction: Specification of Maltese law as governing law and jurisdiction for disputes

What sections are optional to include in a Perpetual Royalty License?

1. Sublicensing Rights: Include when licensee is permitted to sublicense the IP to third parties

2. Improvements: Include when parties anticipate improvements to the licensed IP and need to address ownership and licensing of such improvements

3. Marketing and Promotion: Include when specific marketing obligations or restrictions need to be imposed

4. Insurance: Include when specific insurance requirements are necessary for risk management

5. Change of Control: Include when restrictions on change of control or specific procedures for such events are needed

6. Export Control: Include when the licensed IP is subject to export control regulations

7. Source Code Escrow: Include when the licensed IP includes software and source code protection is required

What schedules should be included in a Perpetual Royalty License?

1. Schedule 1 - Licensed Intellectual Property: Detailed description and/or registration details of all IP being licensed

2. Schedule 2 - Royalty Calculations: Detailed formula and examples for calculating royalties, including any minimum payments

3. Schedule 3 - Quality Control Standards: Specific quality standards, testing procedures, and approval processes

4. Schedule 4 - Reporting Requirements: Templates and specifications for regular royalty reports and other required reporting

5. Schedule 5 - Approved Sub-contractors: List of pre-approved sub-contractors or manufacturers, if applicable

6. Appendix A - Form of Royalty Report: Standard template for royalty reporting

7. Appendix B - Technical Specifications: Technical details and specifications for the licensed IP

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

alex.den.21@genieai.co

Relevant legal definitions

Clauses

Relevant Industries

Technology and Software

Manufacturing

Pharmaceuticals and Biotechnology

Media and Entertainment

Consumer Products

Industrial Design

Research and Development

Telecommunications

Automotive

Fashion and Luxury Goods

Relevant Teams

Legal

Intellectual Property

Finance

Research and Development

Business Development

Quality Assurance

Compliance

Commercial Operations

Technology

Product Development

Relevant Roles

Chief Legal Officer

Intellectual Property Counsel

Licensing Manager

Commercial Director

Chief Financial Officer

Head of Research and Development

Chief Technology Officer

Business Development Director

Contracts Manager

IP Portfolio Manager

General Counsel

Finance Director

Quality Assurance Manager

Compliance Officer

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