I. IP Rights Held By Licensors/Assignor (Party)

A. Patents

1. Obtain list of all patents issued, applied for, in preparation, along with invention disclosures for Party and any and all entities previously acquired by Party.

2. Obtain assurance and/or warranty that the list obtained in A.1. above is a complete list of patent assets related to the transaction.

3. Obtain assurance and/or warranty that all patents have been properly assigned to the Party and that such assignment has been properly recorded.

4. Obtain a list, with assurance and/or warranty, of all recorded security interests or holdings related to patents identified in A.1. above.

5. Check or obtain warranty that the patent assets have been maintained through payment of annuity or maintenance fees.

6. Obtain a disclosure of all infringement proceedings, oppositions, re-examinations, or re-issues of the patents or any other challenges to their validity or enforceability.

7. Establish that all employees of Party are obligated to assign IP rights and have an ongoing obligation to assign rights to successors in interest. Verify against employee list. The assignment agreement needs to be provided.

B. Trade Secret Rights

1. Obtain a copy of the Party's Trade Secret policy and procedure, and assurance that the policy has been implemented to the best of the Party's knowledge.

2. Obtain a description of all Trade Secret (know-how) assets being transferred.

3. Obtain assurance and/or warranty that the list obtained in B.2. above is a complete list of Trade Secret (know-how) assets related to the transaction.

4. Obtain copies of any communications related to the validity of a claim that the subject matter constitutes legally protectable trade secrets.

5. Obtain copies of all Confidentiality and Trade Secret (know-how) agreements currently enforceable by or against the Party.

C. Copyrights

1. Obtain a list of all subject matter which is protectable by copyright protection and related to the transaction.

2. Obtain assurance and/or warranty that the list obtained in C.1. above is a complete list of copyright assets related to the transaction.

3. Obtain assurance and/or warranty that copyright assets listed belong to Party and that no payments or fees are due to any third parties.

D. General IP Ownership Issues

1. Obtain an identification of IP rights being transferred from a third party. Obtain copies of any agreements related to such transfer and review to determine if the transfer of ownership has a negative effect on the rights under the agreement.

2. Obtain a disclosure of transfer and IP created by consultants and determined their ownership status or rights to the technology, as well as any outstanding payments which may be required under an agreement or under national laws.

3. Determine if UCC or other security interest filings have been taken for any of the IP assets being transferred.

4. Obtain disclosure of corporate policies regarding IP ownership.

5. Obtain copies of any opinions regarding the validity or enforceability of the IP assets being transferred.

6. Conduct title search on transferred assets and obtain warranty of ownership.

7. Record security interest transfer and, in some cases, licenses, where appropriate.

8. Consult a Corporate Tax Attorney regarding taxation implications or advantages in proceedings related to transfer of assets and possible incorporation of costs with the overall purchase cost of the Party.

II. IP Rights of Third Parties

A. Infringement Issues

1. Obtain disclosure of any charges of infringement or notices received from third parties regarding intellectual property rights held by third parties and asserted against the Party.

2. Produce internal opinions or those provided by outside counsel regarding the validity of any third party intellectual property infringement claims or evaluation of intellectual property covered by the notices received from a third party.

3. Describe any efforts undertaken to challenge third party intellectual property rights, e.g. opposition, re-examination, litigation, cancellation, nullity actions, etc.

4. Describe any past litigation or settlements related to the transferred property and the assignability of any settlement.

III. IP Transfers

A. Other

1. Identify all agreements whereby Party's IP rights are or where licensed to others and identify the duration of the contract or agreement.

2. Identify any warranties or representations made in prior agreements which effect the IP rights subject to the transfer.

3. Identify whether the rights under any agreement or contract is effected by a change in ownership (i.e. non-assignable or non-transferrable).

4. Obtain a list and copy of all assignment agreements in which IP assets are transferred and assurance and/or warranty that each assignment has been properly recorded with any and all national agencies required.

5. Obtain a list and copy of all Joint Venture and/or Joint Development agreements which include a transfer or sharing of intellectual property rights between Party and another party to the JV or JD agreement.

6. Obtain assurance and/or warranty that the lists obtained in A.3. and A.4.above are complete lists of agreements related to the transaction.

IV. Equipment and Process Operation

A. Verify machinery/equipment:

  1. Owned
  1. Leased
  1. Liens
  1. Assignability of consents required

B. Equipment documentation

  1. Obtain documentation for each piece of equipment including operating manuals and equipment prove-out.
  1. Verify all proprietary information and IP rights required for use of equipment is assigned with each piece of equipment.
  1. Obtain assurance and/or warranty that IP rights obtained are complete for full and continued operation of equipment.

C. Process documentation

  1. Obtain documentation for each process used to produce the product.
  1. Verify all proprietary information and IP rights required for use of process are assigned.
  1. Obtain assurance and/or warranty that IP rights obtained are complete for full and continued operation of process.

V. Miscellaneous

  1. Obtain disclosure of the identity of patent agents/attorneys handling the transferred patents.
  1. Reference transfer plan to Corporate Tax Council for review and comment.
  1. Assure there are no special allocations or government programs for which the Seller has received credits that may be threatened by this acquisition.