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. Consider the others “What-Sis. If you are working with a lawyer to write the contract, it is a good idea to now consider circumstances that could be a problem later. What happens if the licensee goes bankrupt? What happens if the licensee goes bankrupt? What happens if one of the parties is unable to meet its obligations? Can the licensee transfer his property to another party? What are the penalties for infringement? Normally, the subject of a license is that the licensee is passive and receives only royalties, while the taker participates in the business or development and must be used freely as long as royalties are paid and other criteria are met. Failure to comply with the license agreement by the licensee generally results in the termination of the licence and the payment of damages to the licensee. These rights also suggest some of the possibilities for licensing copyrighted material. For example, when a publishing house owns the copyright to a book, it may transfer limited rights to adapt and market the book to another audience. This can be advantageous when it comes to producing international editions of books or releasing copyrighted materials in a format other than that of the copyright holder`s specialty. B, for example, the marketing of an electronic version of a printed product. There are many other ways to pool efforts to promote and sell a product or service ranging from joint participation of a single entity to distribution and distribution agreements to joint ventures (partnerships of two or more companies). In most cases, a license is the preferred method by an individual or entity that simply wants a totally passive role to obtain royalties without even being involved in day-to-day or strategic marketing decisions. One customer said, “I just want to sit down and cash my royalty cheques.” As with music, the software poses particular problems for copyright holders.

By nature, it is slightly duplicated, but unlike music, the software is generally not used in places open to the general public. This poses enormous challenges to software copyright enforcement, as it is estimated that pirate software accounts for between 10% and 40% of software installed on a typical commercial computer. The problem is perhaps more prevalent in the consumer market. A licensing agreement may grant the purchaser exclusive or non-exclusive rights to the use of the product. Often, companies do not grant non-exclusive rights because it offers the best protection of the product. Custom items are often an exception to the rule. There may also be rules defining the exclusive uses of products or cases in which non-exclusive rights apply. 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. In addition to the various clauses included in the licensee protection agreements, some licensees may add their own requirements. They may insist on the guarantee that the licensee owns, for example, the property`s property rights, or they may insert a clause prohibiting the licensee from directly competing with the property granted in certain markets.