License Fee Escalation Clause Samples
A License Fee Escalation clause establishes a mechanism for increasing the fees paid under a license agreement over time. Typically, this clause specifies the frequency and method of fee adjustments, such as annual increases based on a fixed percentage or tied to an inflation index like the Consumer Price Index. Its core practical function is to ensure that the licensor's compensation keeps pace with inflation or market changes, thereby protecting the value of the license and providing predictable cost adjustments for both parties.
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License Fee Escalation. Fee escalation or increase shall be handled by vendor requesting an amendment of DIR Contract No. DIR- ▇▇▇-▇▇▇▇, ▇▇▇▇▇▇▇▇ C, Pricing Index. Upon DIR approval a revised Appendix C Pricing Index will be posted for customer and vendor to discuss increases. Fee increase will NOT be allowed prior to DIR approval. If the License fee is periodic, Licensor shall not increase the fee by more than the lesser of the annual inflation rate, as measured by the Consumer Price Index – All Items for U.S., or three (3) percent unless otherwise stipulated in Exhibit B. Such increases shall not occur more than once per year.