Copyright Security Agreement

A copyright can be used as collateral for a loan.

A copyright security agreement is a written agreement where one person uses his copyrights or copyright licenses as security for the payment of a loan obligation. The owner of the copyrights agrees to transfer them to the lender as collateral for the loan.

Types

Copyright security agreements are commonly used in industries involving creative media such as music, sound recordings and video games. Technology companies that have intellectual property rights in software also use these agreements. Any valuable copyright may be transferred as collateral to secure a loan, if the lender agrees. This can make it easier to obtain financing, especially for a start-up business.

Time Frame

A copyright security agreement should be in writing and define the terms of the agreement, such as the duration of the security interest in the copyright collateral. For example, the agreement could state that the security interest continues until the loan is paid in full.

Considerations

A copyright security agreement can be recorded in the U.S. Copyright Office. This helps protect the lender's interest by giving public notice of the lien. A copyright security agreement can be purchased as a standard business form or it can be drafted by an attorney.

References

• Cornell University Law School: U.C.C. Article 9 - § - 105
• FindLaw: Copyright Ownership and Rights - Small Business
• U.S. Copyright Office: Copyright Basics

Resources

• FindLaw: Glossary: Typical Loan Documents and Terms - Small Business
• U.S. Copyright Office