Posted by: VegasMike
« on: April 13, 2017, 04:09:32 PM »
Thanks Brad. This is a real company that has been in business since the 1940s. Their sales are north of 20 million per year and they have about 15 employees. Earlier this week, they offered me $5000 just to have a 60 day evaluation period; however, some attorney out of New York City sent me a 17 page agreement with terms like "Joint Intellectual Property", "Generated Intellectual Property", etc. I told the company to forget the $5000 and I would send them my prototype and we would just operate under a NDA they signed which retains my intellectual property rights and patent rights. So I essentially, I gave them a 60 day free look at my device which is more than 95% complete but will require a new circuit board lay out and a new injection mold for it's enclosure and some other minor design changes.
When we get further down the road and it come time to discuss a licensing agreement, I know they will want some joint intellectual property rights which is exactly opposite of what I've read and been told to do. So lets say they offer me 5% of sales and $15,000 up front and agree to spent 50 to 100k for manufacturing development but want patent rights. What is normal and customary? What can I tell them? If I agree, then I have no leverage if they under perform on sales. If I disagree they may walk. If I can say it's normal and customary for me to retain all patent rights, maybe they will listen. I have no clue what to do since I can see the full court press coming.