M-Wakili

Ask a lawyer:
Provide a template for a merchandising agreement

Introduction

A merchandising agreement is a legal contract between two parties, typically a licensor and a licensee, that outlines the terms and conditions under which the licensee is allowed to use the licensor's intellectual property (such as trademarks, logos, or characters) for merchandising purposes. In Kenya, such agreements are governed by various laws, including the Constitution of Kenya, the Copyright Act, the Trade Marks Act, and the Law of Contract Act.

Table of Contents

  1. Parties to the Agreement

  2. Recitals

  3. Definitions

  4. Grant of License

  5. Term and Termination

  6. Royalties and Payments

  7. Quality Control

  8. Intellectual Property Rights

  9. Representations and Warranties

  10. Indemnification

  11. Confidentiality

  12. Governing Law and Dispute Resolution

  13. Miscellaneous Provisions

  14. Signatures

1. Parties to the Agreement

This section identifies the parties involved in the agreement.

Example:

This Merchandising Agreement ("Agreement") is made and entered into as of [Date], by and between:

  • Licensor: [Licensor's Name], a company incorporated under the laws of Kenya, with its principal place of business at [Address].

  • Licensee: [Licensee's Name], a company incorporated under the laws of Kenya, with its principal place of business at [Address].

2. Recitals

This section provides the background and purpose of the agreement.

Example:

WHEREAS, the Licensor owns certain intellectual property rights, including trademarks, logos, and characters (collectively, the "Licensed Property");

WHEREAS, the Licensee desires to obtain a license to use the Licensed Property for the purpose of manufacturing, distributing, and selling merchandise;

NOW, THEREFORE, in consideration of the mutual covenants and promises herein contained, the parties agree as follows:

3. Definitions

This section defines key terms used in the agreement.

Example:

  • "Licensed Property" means the trademarks, logos, and characters owned by the Licensor and listed in Schedule A.

  • "Merchandise" means the products that incorporate the Licensed Property and are manufactured, distributed, and sold by the Licensee.

  • "Territory" means the geographic area within which the Licensee is authorized to sell the Merchandise, as specified in Schedule B.

4. Grant of License

This section outlines the scope of the license granted to the licensee.

Example:

  • The Licensor hereby grants to the Licensee a non-exclusive, non-transferable license to use the Licensed Property solely for the purpose of manufacturing, distributing, and selling the Merchandise within the Territory.

  • The Licensee shall not sublicense, assign, or otherwise transfer any of its rights under this Agreement without the prior written consent of the Licensor.

5. Term and Termination

This section specifies the duration of the agreement and the conditions under which it may be terminated.

Example:

  • This Agreement shall commence on the Effective Date and continue for a term of [Number] years, unless earlier terminated in accordance with this Section.

  • Either party may terminate this Agreement upon [Number] days' written notice to the other party in the event of a material breach of this Agreement by the other party, provided that such breach is not cured within such notice period.

6. Royalties and Payments

This section details the financial terms, including royalties and payment schedules.

Example:

  • The Licensee shall pay to the Licensor a royalty of [Percentage]% of the net sales of the Merchandise.

  • Royalties shall be paid on a quarterly basis, within [Number] days after the end of each calendar quarter.

  • The Licensee shall provide the Licensor with a detailed report of net sales for each calendar quarter, along with the royalty payment.

7. Quality Control

This section ensures that the quality of the merchandise meets the licensor's standards.

Example:

  • The Licensee agrees to manufacture the Merchandise in accordance with the quality standards set forth in Schedule C.

  • The Licensor shall have the right to inspect the Licensee's facilities and the Merchandise at any time to ensure compliance with the quality standards.

8. Intellectual Property Rights

This section addresses the ownership and protection of intellectual property rights.

Example:

  • The Licensee acknowledges that the Licensor is the sole owner of the Licensed Property and all associated intellectual property rights.

  • The Licensee shall not challenge or contest the Licensor's ownership of the Licensed Property or any associated intellectual property rights.

9. Representations and Warranties

This section includes the representations and warranties made by each party.

Example:

  • The Licensor represents and warrants that it has the right to grant the license to the Licensed Property.

  • The Licensee represents and warrants that it has the capability to manufacture, distribute, and sell the Merchandise in accordance with the terms of this Agreement.

10. Indemnification

This section outlines the indemnification obligations of each party.

Example:

  • The Licensee shall indemnify, defend, and hold harmless the Licensor from and against any and all claims, damages, liabilities, and expenses arising out of or in connection with the Licensee's use of the Licensed Property.

  • The Licensor shall indemnify, defend, and hold harmless the Licensee from and against any and all claims, damages, liabilities, and expenses arising out of or in connection with the Licensor's breach of its representations and warranties.

11. Confidentiality

This section addresses the confidentiality obligations of each party.

Example:

  • Each party agrees to keep confidential and not disclose to any third party any confidential information received from the other party in connection with this Agreement.

  • The confidentiality obligations shall survive the termination of this Agreement.

12. Governing Law and Dispute Resolution

This section specifies the governing law and the method of dispute resolution.

Example:

  • This Agreement shall be governed by and construed in accordance with the laws of Kenya.

  • Any disputes arising out of or in connection with this Agreement shall be resolved through arbitration in accordance with the rules of the Chartered Institute of Arbitrators, Kenya Branch.

13. Miscellaneous Provisions

This section includes various miscellaneous provisions.

Example:

  • Entire Agreement: This Agreement constitutes the entire agreement between the parties and supersedes all prior agreements and understandings.

  • Amendments: Any amendments to this Agreement must be in writing and signed by both parties.

  • Notices: Any notices required or permitted under this Agreement shall be in writing and delivered to the addresses specified in Section 1.

14. Signatures

This section includes the signatures of the parties.

Example:

IN WITNESS WHEREOF, the parties have executed this Merchandising Agreement as of the Effective Date.


[Licensor's Name]
Title: [Title]
Date: [Date]


[Licensee's Name]
Title: [Title]
Date: [Date]

Conclusion

A well-drafted merchandising agreement is essential to protect the interests of both the licensor and the licensee. It ensures that the terms and conditions under which the intellectual property is used are clearly defined and legally enforceable. By adhering to the relevant laws and including comprehensive provisions, both parties can minimize the risk of disputes and foster a successful business relationship.

Answered by mwakili.com