Whenever possible, you should consider some sort of guaranteed prepayment to make sure you get at least something. This may sound overly pessimistic, but it`s up to any lawyer who negotiates or designs a license to think that things are going to go wrong. The agreement can never consider everything, but when it comes to payment, you need protection. What happens if the licensee pays you a set percentage of revenue, but chooses to offer your product for free or as an add-on to a sale, as is the case in direct marketing? If your product is used as a “come on” and offered for free, even 100% of $0 is still $0. Therefore, a minimum payment type can be very advantageous. Access Bloomberg Law, the complete solution that uses innovative technologies to support your operation. For more information, see pro.bloomberglaw.com. Very nice article.