Trademark licence, Ravenscourt Rovers apparel
Trademark licence agreement with quality control and royalties
A trademark licence lets someone else put your mark on their goods, and the clause that keeps it worth doing is quality control. This one licenses three registered marks from a football club to an apparel maker for three years, at 8 per cent of net wholesale sales with a rising minimum, and approval of every pre production sample in ten business days.
The document, page by page
Every page as it renders and as it prints, with nothing summarised. Read the wording before you reuse it.
Section by section
What each section is for, so you can keep the ones you need and drop the rest.
- Cover and summary
- A spine cover, the parties, and a stats strip with rate, minimum, term and approval window.
- 1. The licensed marks
- A table of three registrations with classes, and what is deliberately left outside the licence.
- 2. What the Licensee may do
- The grant and territory, approved products, sales channels and the bar on sublicensing.
- 3. Quality control
- Sample approval and deemed approval, the production standard, inspection and recall.
- 4. Royalties
- The rate, the minimum royalty table, quarterly reports and the audit right.
- 5. Using the marks properly
- Style guide and notices, ownership of goodwill, and the marketing spend commitment.
- 6. Infringement by others
- Who acts on counterfeits, who pays, and why the licensee does not sue alone.
- 7. Term, termination and sell off
- The three year term, grounds for ending early, and the 90 day run off.
Clauses in this document
How to adapt this agreement
For a non exclusive licence, drop the minimum royalties or cut them sharply, because a minimum is the price of keeping competitors out and makes little sense when they are not. For a licence covering several territories, split the royalty table by territory and set separate minimums, so a strong market cannot subsidise a licensee who is doing nothing in a weak one. For character or artwork licensing, add a copyright licence alongside the trade mark grant, since the drawing and the mark are different rights and a trade mark licence alone does not cover reproduction of the artwork.
Quality control is the condition, not a formality
A trademark tells a buyer where goods come from, so a licence that lets somebody else use the mark without controlling what they put it on undermines the thing being licensed. That is why the quality standards, the approval step and the inspection right are the operative clauses rather than decoration. A licence with no control at all is often called a bare licence and it puts the registration itself at risk. Goodwill built by the licensee accrues to the owner, which is worth stating so it cannot be argued later. In several jurisdictions the licence can also be recorded against the registration, which helps the owner rely on the licensee's use.
What makes this document work
The marks are listed by registration number and class
A word mark, a device and a second word mark, each with its number, its classes and the year it registered. A licence over the brand in general leaves both sides guessing; a licence over registration 2 118 447 in class 25 does not, and it tells the licensee exactly what it is allowed to print.
Sample approval has a deadline on both sides
Ten business days for the club to approve or reject with reasons, and if it says nothing for fifteen, the sample is treated as approved. A quality control clause that lets a licensor sit on a decision stops production; this one keeps the season moving while still protecting the mark.
The minimum royalty rises, and the table shows what it implies
$12,000, $16,000 and $20,000 across three years, alongside the net wholesale sales each figure implies at 8 per cent: $150,000, $200,000 and $250,000. Both sides can see whether the target is realistic before signing rather than arguing about it in year two.
Questions people ask
What is a trademark licence agreement?
A contract letting one business use another's registered trade marks on agreed goods, in an agreed territory, for a fee. Ownership stays with the licensor, and so does the goodwill the licensee's sales generate, which is why the licensee also agrees not to register anything similar.
Why does a trademark licence need quality control?
Because a trade mark tells buyers where goods come from. A licensor that never checks what is made under its mark risks the mark itself becoming misleading or vulnerable. The approval, inspection and recall steps in this agreement are not administration, they are the reason the licence can exist.
How are trademark royalties usually calculated?
As a percentage of net wholesale sales, which this agreement defines as the invoiced price to the retailer less returns, trade discounts actually given and separately shown freight. No deduction is allowed for marketing, distribution or bad debts, because those are the licensee's costs of doing business.
What is a minimum guaranteed royalty?
An amount payable whether or not sales reach it, so the licensor is not left with a dormant licence. Here it rises from $12,000 to $20,000 across three years, a shortfall is invoiced within 30 days of year end, and a surplus in one year is not carried into the next.
What happens to unsold stock when a trademark licence ends?
The licensee may sell existing approved stock for 90 days, reporting and paying royalties as usual. After that, remaining stock is offered to the licensor at cost, and anything not bought has the marks removed or is destroyed, with written confirmation that it has been.
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