CH25 Exercise Drafting a Condition.2e
docx
keyboard_arrow_up
School
Drake University *
*We aren’t endorsed by this school
Course
LAW-110
Subject
Law
Date
Apr 3, 2024
Type
docx
Pages
2
Uploaded by abbyluther
Abrielle Luther
Chapter 25 Exercise:
DRAFTING A CONDITION
For use with Contracts: A Modern Coursebook
by Ben Templin. (c) 2019 Ben Templin
The file may be copied and distributed only by professors and their assistants to students who are enrolled in a course where the book is assigned as a text. Otherwise, do not distribute or copy these materials in whole or in part without express written permission. Who are you? You are a junior attorney in a transactional law firm that negotiates and drafts contracts for large companies. Learning Objective This exercise is meant to give you experience in drafting a contract clause as a condition. What is your assignment? A senior attorney sends you the following email:
Dear Associate:
Manufacturer is an important client of our firm. The company has been in negotiations with Engineer to license technology that Engineer developed for use in a new type of flying skateboard. I already sent one draft of the agreement to the parties. The original terms were simple. Manufacturer was to immediately give Engineer $300,000 in exchange for the exclusive rights to use Engineer’s skateboard technology worldwide for the next ten years. However, prior to signing the agreement, the parties changed their minds. Both parties recognized that if Engineer could get a patent on his skateboard technology then the technology would become even more valuable. It can take one or two years for the U.S. Patent and Trademark Office (US PTO) to decide whether to grant a patent. Manufacturer
still wants to license the technology immediately for $300,000 but is willing to pay an additional licensing fee of $500,000 if a patent is granted. However, if the patent is granted, then Manufacturer wants the term of the license to increase from ten to twenty years. Of course, it is possible that the US PTO will not grant the patent, but the Engineer
is optimistic. I do not have time to change the original draft contract to reflect these new terms. I want you to do it. Instead of sending you the entire agreement, I am only giving you the two clauses that need modification – Section 2, The Licensing Fee
and Section 10, Term of the
Agreement
. Please draft each new provision as a conditional promise precedent according
to the terms of this email. Please let me know if you have any questions about this email or the draft.
1
Abrielle Luther
OLD
2. Licensing Fee
Manufacturer shall pay Engineer a $400,000 nonrefundable licensing fee immediately upon signing this Agreement. 10. Term of Agreement
The term of this Agreement shall run for ten years from the date that this Agreement is signed (the “Term”). Signed,
Senior Attorney New
2. Licensing Fee
Manufacturer shall pay Engineer a $300,000 nonrefundable licensing fee immediately upon signing this Agreement. 10. Term of Agreement
The term of this Agreement shall run for ten years from the date that this Agreement is signed (the “Term”). In the event that a patent is granted, Manufacturer shall pay Engineer an additional licensing fee of $500,000 in exchange for an additional ten years to the licensing term, totaling twenty years.
Signed,
Senior Attorney 2
Your preview ends here
Eager to read complete document? Join bartleby learn and gain access to the full version
- Access to all documents
- Unlimited textbook solutions
- 24/7 expert homework help