Identify Tech License Term Sheet Issues

Skill: Identify Tech License Term Sheet Issues

1. Subject-matter triage

• Treat the term sheet, side letter, existing agreements, and GC instructions as a single source set; do not analyze the term sheet alone.
• Identify whether there is one proposed license package or multiple alternatives, and analyze each separately if more than one is in scope.
• If the deal contemplates an exclusive license, treat exclusivity feasibility as a threshold question before polishing business terms.

2. Failure modes the skill is correcting

• Reviewing the proposed license in isolation without checking whether prior grants, consent rights, transfer limits, or approval requirements already constrain the transaction.
• Missing inconsistencies between the term sheet and the side letter, or failing to determine which document controls when they differ.
• Treating open points as generic deal commentary instead of board-level issues with a clear risk and recommended position.
• Overlooking whether the proposed field, sublicensing scope, improvement allocation, or exclusivity structure fits the actual commercial model.
• Failing to flag provisions that should not be signed until business or board approval is obtained.
• Stating conclusions without tying them to the governing agreement language or the applicable legal/contractual rule.

3. Legal frameworks / domain conventions that apply

• Check existing-rights agreements for consent rights, exclusivity limits, assignment or sublicense restrictions, and any approval triggers that could bar or condition the new license.
• Read the term sheet together with the side letter and apply the document-precedence clause or governing-order language to resolve conflicts.
• Compare every proposed term against the playbook or key provisions baseline; deviations should be identified as negotiation points, not normalized as standard.
• Draft license field-of-use language with precision under ordinary technology-licensing practice: the field should track actual product use cases, customer segment, disease area, workflow, or deployment mode as applicable, and should not unintentionally broaden rights.
• Treat sublicensing as express, not implied; if the business model requires distribution, integration, reseller use, or customer-facing deployment, confirm the grant covers that path.
• Confirm whether improvements are assigned, retained, licensed back, or jointly owned, and whether any background IP / foreground IP split is workable under the stated development model.
• Test whether exclusivity is legally and commercially feasible in light of any existing grants or reservations of rights in the same field.
• If a board or investor approval condition exists in the source documents, treat it as a gating item rather than a drafting preference.

4. Analytical scaffolds

1. Enumerate the in-scope documents and counterpart obligations, then analyze the package document by document before synthesizing conflicts.
2. Map each material term against the playbook or baseline position and note every deviation that changes risk, economics, control, or operational flexibility.
3. Compare the side letter to the term sheet and identify whether it narrows, expands, or contradicts any operative provision.
4. Cross-check the proposed license against existing agreements for restrictions, consents, reserved rights, or pre-existing exclusivity that affect validity or enforceability.
5. Review the field-of-use definition for precision, commercial fit, and overlap with any already-granted field.
6. Review sublicensing language against the intended distribution or commercialization model.
7. Review improvement ownership, license-back, and derivative works treatment for practical deal fit and future control.
8. Test exclusivity against existing grants and the licensor’s ability to promise the scope being sold.
9. For each issue, state: the provision, the deviation or conflict, the governing authority or document language, the business/legal risk, and the recommended negotiation position.
10. Rank issues by board significance so the memo separates decisive blockers from items suitable for follow-up or cleanup.

5. Vertical / structural / temporal relationships

• Track hierarchy across sources: existing agreements may limit the deal, the term sheet may set the commercial deal points, and the side letter may qualify or override specific terms if the precedence language permits.
• Treat timing as material where approval, execution, effectiveness, milestone, launch, or diligence timing affects whether a term is operative or merely aspirational.
• Where more than one party, field, product, or use case is implicated, separate the analysis by each distinct scope rather than collapsing them into one general risk statement.

6. Output structure conventions

• Write a board-ready issues memo, not a deal summary.
• Begin with a concise executive overview that states the overall transaction posture and whether any issue is likely to block signing or require escalation.
• Follow with a short section of confirmed key terms so the board can see what appears settled.
• Add a separate section for term sheet / side letter conflicts.
• Add a separate section for existing-rights or consent implications that may require board or other approval.
• Then provide numbered issues, each with an ordinal severity label defined once at the top of the memo and applied consistently.
• Each issue entry should include the relevant provision, the issue, the governing authority or controlling document language, the consequence to Atherton, and the recommended position.
• When a legal proposition is stated, cite the controlling authority by name and section, or cite the governing contract clause or document provision as identified in the source set.
• Close with an explicit Recommended Actions block that assigns each action to the responsible role and ties it to the relevant transaction timing or approval milestone.