Technology Intellectual Property Representation
(Pro-Buyer)

Summary

This Technology Intellectual Property Representation (Pro-Buyer) clause may be used by buy-side counsel in a transaction in the technology space. It may also be used for any deal in which buyer is acquiring IP. This template includes practical guidance and drafting notes. Because IP is typically a key component of a technology company's value, it is imperative that buyer exhaustively (1) identify, (2) diligence, and (3) based on the results of such diligence, address to its satisfaction any and all limitations on buyer's ability to take ownership of seller's intellectual property free and clear. To the extent that there is litigation or other risk associated with the IP, buyer should require seller to make appropriate disclosures so that buyer may assess the risk and adjust the purchase price or make appropriate adjustments to the terms of the transaction. IP plays such a prominent role in technology transactions that, unlike in traditional merger and acquisition deals, these types of IP ownership and non-infringement of third-party representations are often treated as fundamental representations. For a discussion of IP due diligence and related representations in technology deals, see Technology M&A Transactions — Key Diligence Areas and Related Representations. For a pro-seller version of this representation, see Technology Intellectual Property Representation (Pro-Seller). For a discussion of knowledge qualifiers, see Knowledge Definition Clause.