License And Supply Agreement Meaning

(iii) where the other contracting party undergoes a change in its final control (it is understood that the term „control“ has the meaning assigned to it in the definition of the related business), provided that the new owner of the other party has substantial commercial activity in the same area of activity as the party that may be terminated in accordance with this section 7.2. Licensing agreements are often used for the commercialization of technologies. 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. 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. 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. 4.3 A does not guarantee or guarantee that (i) a certain degree of commercial success will be achieved with respect to the sale of B and (ii) that the normal and predictable use of the licensed patents thus issued poses no risk to the safety or health of workers or purchasers of these products.