Confidentiality agreement. Both parties agree not to disclose trade secrets. There are certainly advantages to licensing your business assets, but make sure you take these factors into account when creating a licensing agreement: That`s everything else that both parties want to add. Some license agreements contain confidentiality agreements such as .B. This clause would prevent the taker from disclosing proprietary information or processes. Do your due diligence before the agreement. Both parties should carefully consider the other party. Check business credits and continuous management. Ask for a degree. Visit the offices and production sites of the other company. Try to do it.

Most licensing agreements also deal with the issue of quality. For example, the licensee may enter into the contract conditions that require the purchaser to provide prototypes of the product, mockups of the packaging and even occasional samples for the duration of the contract. Of course, the best form of quality control is usually achieved before the fact – by carefully checking the reputation of the licensee. Another common quality provision in licensing agreements is the method of disposing of unsold products. If stock items are sold as cheap knockoffs, this can damage the licensee`s reputation in the market. Start and end of the agreement. Say when the agreement will be reached and when it will end. Describe the possibility of a renegotiation and continuation of the agreement at the end of the agreement. Please consider the circumstances under which the agreement may expire before the expiry of the term.

What happens to the possession of the product at the end (usually it is converted into owner)? Examples of licenses are available in many different sectors. An example of a licensing agreement is an agreement between software copyright holders to a company, which allows it to use computer software for their day-to-day activities. An example of a licensing agreement in the restaurant industry would be that a McDonald`s franchisee has a licensing agreement with McDonald`s Corporation that allows them to use the company`s branded and marketing materials. And toy manufacturers regularly sign licensing agreements with movie studios and give them the legal authority to produce action characters based on popular similarities of movie characters. Because of the legal basis they have to cover, some licensing agreements are quite lengthy and documents complex.