Eula for Limited-Exclusive License

dingbat · January 21

Howdy! I'm currently working on adapting my Eula to a limited-exclusive license for a custom font client project and not sure where to start. It would be a 3-year exclusive period.

Any tips or resources on it would be appreciated!

John Hudson · January 21

Disclaimer: I am not a lawyer, and you should have your EULA looked at by one.

A typical EULA includes a statement that the agreement is non-exclusive, so you want to find that part of the agreement and state the period of exclusivity, e.g.

XXX hereby grants to you an exclusive license to use the Font(s) for a period of 3 (three) years and thereafter a non-exclusive license under the terms of use stated in this Agreement.

TimAhrens · January 21

Not sure whether this has been discussed before, but if it is a custom design then the client surely wants to own it so they don’t have to worry about license terms any more.

Is an existing EULA even a good starting point for this kind of document? Do you even need (or, will the client even accept) an EULA in the case of a custom font? What would the EULA say if it does not impose any sort of restrictions?

Thomas Phinney · January 21

Even if the client was to own it, you still need a contract that spells out that ownership. The label may change, but it is really important for both parties that it be spelled out.

In the case at hand, the designer said their client was getting a three-year period of exclusivity, so that would be a license (EULA) rather than some other kind of contract.

Temporary exclusivity, even for custom designs, is not unusual. Basically if the type designer figures they can make money off of future licensing, and the client does not want to pay as much as would be required for them to get permanent exclusivity or ownership, then it makes sense.

dingbat · January 21

John Hudson said:

Disclaimer: I am not a lawyer, and you should have your EULA looked at by one.

A typical EULA includes a statement that the agreement is non-exclusive, so you want to find that part of the agreement and state the period of exclusivity, e.g.

XXX hereby grants to you an exclusive license to use the Font(s) for a period of 3 (three) years and thereafter a non-exclusive license under the terms of use stated in this Agreement.

Thanks John, this is super helpful to add!

TimAhrens said:

Not sure whether this has been discussed before, but if it is a custom design then the client surely wants to own it so they don’t have to worry about license terms any more.

Is an existing EULA even a good starting point for this kind of document? Do you even need (or, will the client even accept) an EULA in the case of a custom font? What would the EULA say if it does not impose any sort of restrictions?

For this project, the client wants the font made but is still figuring out their brand. I think they want something to bridge the gap in the meantime. These are great questions though, would love to get insight from others on their experience!

Nick Shinn · January 22

Limited-time exclusivity is, I believe, quite common. (I’ve offered it many times).

The beauty of it is that the client can decide how long they want this particular branding to last, if not for ever, and receive a discount for the limited term.

From the type designer’s perspective, one gets paid a fee up-front for the design work, offsetting the speculative nature of most designs that one (well, me at least) adds to one’s full catalogue of retail fonts.

The downside is that the typeface may become associated with the initial client’s brand, and hence be offputting to other corporations.

John Hudson · January 22

Consider also adding a non-automatic renewal of exclusivity option. Typically, this would be something like extending the period for exclusivity for another three years if they a) give you notice of their desire to extend the exclusivity no less than six months before the first period ends (this give you time to make plans for releasing the font if they decide not to extend the exclusivity), and b) pay a exclusivity extension fee.

This can be attractive to the client at this stage, because the extension fee is set now and locked in. In my experience, though, as the deadline for giving notice approaches, clients very often come back and ask for a price to own the fonts. By that stage, it has proven its value, and it seems more attractive to buy out the rights rather than just paying for an extension of exclusivity.

Eula for Limited-Exclusive License

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