5.7 Model trade secret license (Janicke)
AGREEMENT
1. Parties and consideration
1.1 This agreement is between Super Corp. (hereafter “SUPER”), a Delaware corporation
having a place of business at ______ , and Acme Corp. (hereafter “ACME”), a New
York corporation having a place of business at ______.
1.2 The consideration for this agreement consists of the representations and undertakings
expressed herein. Neither party is relying on any other representation or understanding
not expressed herein.
2. Definitions
The following definitions apply to the terms used herein:
2.1 “Super Trade Secret” means any information as to which SUPER owns a trade secret
relating to copy machines.
2.2 “Acme Product” means any product designed primarily by Acme and intended to be
sold by Acme under its trademarks and under its warranty. A product whose design is
controlled by another entity is not an Acme Product even if it is made by Acme.
2.3 “Licensed Product” means any Acme Product whose manufacture or use involves a
Super Trade Secret.
2.4 “Net Selling Price” means the actual price charged to an ACME customer for a
product packed ready for shipment, excluding freight, sales taxes, and insurance. If such
price is not in U.S. dollars, payments hereunder shall be calculated based upon the
average currency exchange rate for the date in question, as appearing in the New York
Times.
3. Representations
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5.7 Model trade secret license (Janicke)
3.1 SUPER represents that it owns valuable trade secrets relating to copy machines and
the legal authority to grant the licenses herein with respect to such secrets.
3.2 ACME represents that it is engaged in the business of manufacturing and selling copy
machines, that it has never been the subject of a bankruptcy petition, and that it has never
been insolvent.
4. Disclosure and nonexclusive license grant
4.1 Within thirty days after execution of this agreement, SUPER shall communicate to
ACME the Super Trade Secrets relating to copy machines that are to be licensed
hereunder. [Further definition, e.g., “substantially all of its knowledge,” or “sufficient to
manufacture copy machines of the ____ type,” etc.] [Further on mechanisms of
disclosures, e.g., “Within sixty days after execution of this agreement, SUPER shall
commence training of ACME personnel in the manufacture of copy machines by using
Super Trade Secrets, such training to continue for three months.”]
4.2 SUPER hereby grants to ACME a nonexclusive license to use such Super Trade
Secrets in the manufacture of ACME PRODUCTS.
4.3 The benefit of this license shall inure to wholly owned or majority owned subsidiaries
of ACME, unless ACME gives written notice to the contrary with respect to a particular
subsidiary. The license granted herein shall not be otherwise transferable without the
consent of SUPER. In the event of a merger of ACME, or a sale or transfer of
substantially all of ACME’s copy machine business to another entity, SUPER’s consent
to transfer of this agreement to such other entity shall not be unreasonably withheld.
5. Payments
5.1 Upon the effective date of this agreement ACME shall pay to SUPER the sum of
$10,000.
5.2 ACME shall pay to SUPER a royalty of 5% of the Net Selling Price of each Licensed
Product.
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5.7 Model trade secret license (Janicke)
5.3 Time for accrual of payment obligations. A payment obligation for a Licensed
Product does not accrue until the product is sold. A sale is deemed to occur whenever it is
booked as such by ACME, but in no event later than the date of physical delivery of the
product to the customer. A lease or other possessory arrangement with a customer shall
be regarded as a sale for purposes of this paragraph, and in that event all monies received
by ACME from the customer shall be regarded as parts of the selling price.
5.4 Time for payments. Payments accruing under this Article 5 shall be made based on
accrual time periods. The first accrual period shall be the period from the effective date of
this agreement to the end of the next full calendar quarter. From then on each accrual
period shall be each calendar quarter during the term hereof. Payment for an accrual
period shall be made within thirty days of the close of that accrual period.
5.5 Reports. Each payment under paragraph 5.2 shall be accompanied by a report stating
the manner of calculation of the amount due. ACME shall maintain accurate records from
which the correctness of each report can be verified. SUPER shall have the right to audit
such records at reasonable times. If an audit reveals underpayment by 5% or more,
ACME shall, in addition to promptly paying the difference, reimburse SUPER for the
cost of the audit.
5.6 Future licenses to other entities. If after the effective date of this agreement a SUPER
should grant a nonexclusive license to another entity for substantially the same
confidential information, under different provisions as to periodic payments, SUPER
shall promptly disclose such different periodic payment provisions to ACME. ACME
shall have sixty days in which to elect, from the date of election forward, to substitute
such different payment provisions for those of paragraph 5.2. This paragraph shall not
apply to any lump-sum payments or payments for releases from past liability in the
agreement with the other entity; and this paragraph shall not apply at all if the agreement
with the other entity is a cross-license arrangement. Any election under this paragraph by
ACME shall operate in futuro only and shall have no effect on amounts theretofore
accrued for payment hereunder by ACME. Failure of SUPER to pursue misappropriators
shall not be regarded as a license to such infringers for purposes of this paragraph.
6. Term and Secrecy
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5.7 Model trade secret license (Janicke)
6.1 The term of this agreement shall begin on the date when this agreement is signed by
both parties, which date shall be the effective date hereof. Unless sooner terminated as
herein provided, the term shall be ten years.
6.2 SUPER shall identify its trade secrets by appropriate marking of documents
containing them, such as the legend “Proprietary” or “Confidential.” For secrets
transmitted orally, SUPER shall communicate similar indications orally. ACME shall
maintain Super Trade Secrets in strict confidence during and after the term of this
agreement, and shall assure that its employees, agents, and consultants do so.
6.3 ACME shall have no further obligation under this agreement with respect to any
Super Trade Secret which:
(a) without fault of ACME or its employees, agents, or consultants, becomes
generally known in the copy machine industry; or
(b) is disclosed by SUPER to a third party without obligation of confidence.
7. Default and Termination
7.1 If ACME shall default on any obligation hereunder, SUPER shall have the right to
send a written notice thereof, which shall be effective upon dispatch. ACME shall have
thirty days in which to cure such default. Upon ACME’s failure to timely cure the
default, SUPER shall be entitled to terminate this agreement by sending written notice of
termination, which shall be effective on dispatch.
7.2 No waiver by SUPER of default for any obligation of ACME hereunder shall operate
as a waiver in the case of any subsequent default by ACME.
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8. Warranties
8.1 Each party warrants that it has authority to enter this agreement.
9. Infringers
9.1 In the event a third party shall misappropriate any Super Trade Secret, ACME may
give notice of that situation to SUPER, and SUPER may take such action as it deems, in
its sole discretion, appropriate. Unlicensed activity by a third party shall not be ground
for alteration of the payment obligations of ACME as specified herein.
10. Arbitration
10.1 Any dispute between the parties relating to the construction or operation of this
agreement shall be resolved by binding arbitration under the laws of New York, before a
single arbitrator named by the parties. In the event the parties are unable to agree upon an
acceptable arbitrator within a reasonable time after the dispute has arisen, either party
may request the American Arbitration Association to appoint the arbitrator.
10.2 The parties shall attempt in good faith to agree upon rules of procedure for the just
and expeditious resolution of the dispute by the arbitrator. The arbitrator’s decision shall
be binding and nonappealable. Judgment may be entered thereon by any court of
competent jurisdiction. The arbitrator’s fees shall be divided and paid by the parties
equally.
11. Notices and Miscellaneous
11.1 Notice to ACME shall be sufficient hereunder if in a writing addressed to ACME as
follows: ______________. Notice to SUPER shall be sufficient if in a writing addressed
to SUPER at __________.
11.2 Except for terminations as provided for herein, this agreement may be modified only
by a writing signed by both parties.
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5.7 Model trade secret license (Janicke)
IN WITNESS WHEREOF, the parties have caused their duly authorized representatives
to execute this agreement on their respective behalfs.
Super Corp.
Acme Corp.
By: __________________
By: __________________
Title: _________________
Title: _________________
Date: _________________
Date: _________________
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