Licensing agreements cover a large number of known situations. For example, a retailer could enter into an agreement with a professional sports team for the development, manufacture and sale of goods bearing the sports team logo. Or a small manufacturer could concede a production technology owning a larger company to gain a competitive advantage rather than investing the time and money to develop its own technology. Or a greeting card company can agree with a movie distributor to create a series of greeting cards that carry the image of a popular animated character. The benefits of licensing can be viewed from two angles: licensees and licensees. A licensee wants to manufacture products using these brands. The licensee would like to pay for the license. The licensing agreement is the way in which both parties enter into an agreement that benefits both parties. In May 2018, Nestlé and Starbucks entered into a $7.15 billion coffee licensing agreement. Nestlé (the licensee) has agreed to pay $7.15 billion in cash to Starbucks (the licensee) for exclusive rights to sell Starbucks products (single serving coffee, teas, beans, etc.) through Nestlé`s worldwide distribution network. In addition, Starbucks receives royalties from coffees and packaged teas sold by Nestlé. This article is just a general overview of licensing agreements; It is not complete and should not be used to prepare a legal document. Using a model that you find on the Internet is dangerous because it cannot address certain laws and your own situation.
An example of a very common property contained in licensing agreements is the image of a cinematic superhero. Toy manufacturers will often allow it to sell action characters that are much more likely to be purchased if they are based on a popular superhero. Another common example is the licensing of a song for an advertising campaign or for use in a movie. In the fast food market, there are a number of franchise-based businesses, where a franchisee holds the rights to the name, products and promotional material of the main company. Exclusive and territory. The licensee is granted the exclusive right to manufacture and sell the product in a given territory. The licensee agrees that others are not allowed to sell the product in this area. This part of the agreement is usually accompanied by a clause. Intellectual property licensing agreements are the most common, such as patents, trademarks and copyrighted material. Music, film, video and works of art are the main copyrighted materials. Although a licensing agreement does not give you ownership of another entity, you can use it as long as you follow the parameters described in the agreement.
Another common element of licensing agreements is the party that retains control over copyrights, patents or trademarks. Many contracts also contain a provision on territorial rights or distribution in different parts of the country or the world.