I'm replying a little late to this and the other replies seem to cover the topic well. The only thing I'll comment on is that it's worth asking, rather than assuming, to try and determine their intent. The intentions behind their request can vary from malicious (let's put this guy out of business to become the exclusive provider of this solution) to ignorant (not understanding what options they already have based on your current licensing agreement). I suggest you ask to get clarification. If they're not able to reasonably explain themselves in short order then (in my experience) they're either out to harm (avoid them) or they just don't "get it" (at which point it's up to you to decide how much time you are willing to invest in working with them). Regardless, what you have is worth something to them - if it wasn't, then they wouldn't be asking for it. You can counter with an offer that you think is reasonable or ask them to make a reasonable offer (I'd suggest the latter). If they don't put forward a serious offer then politely tell them that you can only entertain serious offers. They can't expect something for nothing. Good luck, Chris