• Conveys the option, but not the obligation, to license IP from the provider

• Usually time limited

• Terms of a license agreement may be agreed upon at the onset of the Option Agreement or the option may be to negotiate for a license

• Often requires less commitment for the optionee (recipient), but also conveys no, or limited, rights to the IP during the term of the option

• Allows the optionee to further evaluate its interest while keeping the IP available for the optionee to license it from the provider in the future

• May be exclusive, meaning the provider cannot offer the IP to third parties during the term of the Option Agreement

• Option agreements may include provisions for the transfer of materials rather than being a separate agreement (HYBRID INSTRUMENT ...MTA components)