Source Code License Royalty Clause Samples
The Source Code License Royalty clause establishes the requirement for payment of royalties in exchange for the right to use, modify, or distribute source code under a licensing agreement. Typically, this clause specifies the amount, frequency, and method of royalty payments, and may outline whether royalties are based on sales, usage, or a flat fee. Its core practical function is to ensure that the licensor is compensated for granting access to the source code, thereby protecting their financial interests and clarifying the economic terms of the license.
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Source Code License Royalty. In consideration of the license rights related to PS Source Materials set forth in Section 2.9 of this Agreement, Licensee shall pay to PalmSource a one-time non-refundable royalty in the amount of six million dollars ($6,000,000) in three equal annual installments of two million dollars ($2,000,000) due on the Amendment Execution Date and the two subsequent anniversaries of the Amendment Execution Date; provided, however, no further source code license fees shall be owing under this Section II(D) (Source Code License Royalty) if (i) Licensee requests consent for the source code license under Section 2.9 to continue notwithstanding an acquisition under Section 2.10(a) (Acquisition of Licensee by Competitor of PalmSource); and (ii) PalmSource does not provide consent and Licensee’s source code license is terminated due to such acquisition pursuant to Section 2.10(a) (Acquisition of Licensee by Competitor of PalmSource) and not due to breach by Licensee.
Source Code License Royalty. In consideration of the license rights related to Source Materials set forth in Section 2.9 of this Agreement, Licensee shall pay to PSI (1) with respect to Source Materials access during Contract Years one through five, a one-time non-refundable royalty in the amount of six million dollars ($6,000,000) in three equal annual installments of two million dollars ($2,000,000) due on the ARSLA Execution Date and the two subsequent anniversaries of the ARSLA Execution Date (and the parties acknowledge that Licensee has made the first two installment payments as of the SARSLA Execution Date); provided, however, no further source code license fees shall be owing with respect to such Contract Years under this Section II(D) (Source Code License Royalty) if (i) Licensee requests consent for the source code license under Section 2.9 to continue notwithstanding an acquisition under Section 2.10(a) (Acquisition of Licensee by Competitor of PalmSource); and (ii) PSI does not provide consent and Licensee’s source code license is terminated due to such acquisition pursuant to Section 2.10(a) (Acquisition of Licensee by Competitor of PalmSource) and not due to breach by Licensee; and (2) with respect to Source Materials access during Contract Years six, seven and eight, a non-refundable royalty payable in advance annually in the amount of four hundred thousand dollars ($400,000) per annum, the first of which will be due not later than [**]; provided, however, no further source code license fees shall be owing under this Section II(D) (Source Code License Royalty) if (i) Licensee requests consent for the source code license under Section 2.9 to continue notwithstanding an acquisition under Section 2.10(a) (Acquisition of Licensee by Competitor of PalmSource); and (ii) PSI does not provide consent and Licensee’s source code license is terminated due to such acquisition pursuant to Section 2.10(a) (Acquisition of Licensee by Competitor of PSI) and not due to breach by Licensee.