Meaning
A remedial agreement executed by founders or contractors confirms and validates past transfers of intellectual property. The retroactive assignment ratification is used to cure gaps in the startup’s chain of title. It provides written confirmation that all work done prior to the execution of formal agreements is owned by the corporation.
This ensures that the startup holds clear title to all early technology.
Curing Gaps
Curing these defects is often a condition precedent to closing any Series A funding round. If an investor’s legal counsel identifies a gap in the early assignments, they will require a retroactive assignment ratification before deploying capital. This protects the fund from future ownership claims.
Legal Validation
Signing this document requires the cooperative signature of the original creator or former employee. The document must state that the individual assigns all rights and ratifies the transfer as of the date the work was performed. This retroactive effect helps to eliminate any legal ambiguity surrounding the startup’s IP ownership.
Due Diligence
Venture capital firms and corporate acquirers perform a detailed review of all ratifications during the due diligence process. They will verify that the ratifications are legally binding and that the consideration paid was adequate. This ensures that the company’s patent and software assets are fully protected from future disputes.
