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Product License Agreement Template for United States

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Key Requirements PROMPT example:

Product License Agreement

"I need a Product License Agreement for licensing our new AI software to enterprise customers in the United States and Canada, with specific provisions for data privacy compliance and source code protection, to be implemented by March 2025."

Document background
The Product License Agreement serves as a crucial legal instrument in commercial transactions where one party wishes to grant another the right to use their product while maintaining ownership rights. This document is essential when companies seek to monetize their products through licensing rather than direct sales, or when expanding market reach through authorized users. Under U.S. jurisdiction, this agreement must comply with federal and state regulations, including intellectual property laws, consumer protection statutes, and industry-specific requirements. The agreement typically covers scope of use, financial terms, quality control, and termination conditions.
Suggested Sections

1. Parties: Identification and details of the licensor and licensee

2. Background: Context of the agreement and brief description of the product being licensed

3. Definitions: Key terms used throughout the agreement

4. Grant of License: Scope and nature of the license being granted

5. License Fees and Payment Terms: Financial terms including pricing, payment schedule, and methods

6. Term and Termination: Duration of agreement and conditions for termination

7. Intellectual Property Rights: Ownership and protection of IP rights

8. Warranties and Limitations: Product warranties and limitation of liability

Optional Sections

1. Territory Restrictions: Geographic limitations on license use - include when license is restricted to specific regions or territories

2. Maintenance and Support: Terms for ongoing product support and updates - include when offering technical support or maintenance services

3. Export Controls: Compliance with export regulations - include when product may be subject to international trade restrictions

4. Source Code Escrow: Terms for source code protection and access - include for software products where source code protection is crucial

Suggested Schedules

1. Product Specifications: Detailed technical specifications of the licensed product

2. Fee Schedule: Detailed breakdown of license fees and payment terms

3. Service Level Agreement: Performance metrics and service standards for software or technical products requiring ongoing support

4. Acceptable Use Policy: Guidelines for proper product use and restrictions - for products with specific usage requirements

Authors

Alex Denne

Head of Growth (Open Source Law) @ ¶¶Òõ¶ÌÊÓÆµ | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

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Industries

Intellectual Property Laws: Primary federal statutes including Copyright Act (17 U.S.C.), Patent Act (35 U.S.C.), Trademark Act (Lanham Act, 15 U.S.C.), and Trade Secrets Protection (Defend Trade Secrets Act)

Contract Law: Uniform Commercial Code (UCC) Article 2, state-specific contract laws, and common law principles of contract formation and enforcement

Consumer Protection Laws: Federal Trade Commission Act, state consumer protection statutes, Magnuson-Moss Warranty Act, and Consumer Product Safety Act

Digital and Software Laws: Computer Fraud and Abuse Act, Digital Millennium Copyright Act (DMCA), Electronic Communications Privacy Act, and state-specific data protection laws

International Compliance: International IP treaties, export control regulations, and international trade laws that may affect cross-border licensing

Industry-Specific Regulations: Regulatory requirements specific to the product type, including both federal and state regulatory frameworks

Privacy Laws: State privacy laws, federal privacy regulations, and specific legislation like CCPA for California customers

Antitrust and Competition Laws: Sherman Act, Clayton Act, and Federal Trade Commission Act provisions affecting licensing terms and competition

Dispute Resolution Framework: Federal Arbitration Act, state arbitration laws, and jurisdictional considerations for dispute resolution

Warranty and Liability Laws: Product liability laws, state warranty laws, and statutory provisions regarding limitation of liability

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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