A Trademark License Agreement Between Parent And Subsidiary is essential when a corporate group needs to formalize the use of trademarks within its organization structure in Canada. This document is typically used when a parent company wants to maintain control over its trademark portfolio while allowing its subsidiary to use these valuable assets in their business operations. The agreement should comply with Canadian federal and provincial laws, particularly the Trademarks Act and relevant corporate legislation. It includes critical provisions for quality control, usage parameters, and reporting requirements to maintain trademark validity. The document is particularly important for tax compliance, transfer pricing considerations, and maintaining proper corporate governance within the group structure. It should be reviewed periodically to ensure continued alignment with changing business needs and regulatory requirements.
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1. Parties: Identification of the parent company (Licensor) and subsidiary (Licensee), including full legal names and registration details
2. Background: Context of the agreement, establishing the parent-subsidiary relationship and ownership of the trademarks
3. Definitions: Detailed definitions of key terms including Licensed Marks, Territory, Field of Use, and Quality Standards
4. Grant of License: Scope of the trademark license, including territory, exclusivity, and field of use restrictions
5. Quality Control: Standards, inspection rights, and approval processes to maintain trademark validity
6. Usage Requirements: Specific requirements for trademark usage, including format, placement, and notices
7. Term and Termination: Duration of the agreement and circumstances for termination
8. Ownership and Goodwill: Confirmation of Licensor's ownership and assignment of goodwill
9. Royalties and Payment: Payment terms, even if nominal, for tax and transfer pricing purposes
10. Records and Reporting: Requirements for maintaining records and reporting on trademark usage
11. Governing Law: Specification of Canadian law as governing law and jurisdiction for disputes
1. Sublicensing Rights: Include when the subsidiary may need to sublicense to its own subsidiaries or affiliates
2. International Usage: Include for cross-border trademark usage and international subsidiary operations
3. Marketing and Promotion: Include when specific marketing requirements or restrictions are needed
4. Change of Control: Include when specific provisions are needed for subsidiary ownership changes
5. Related Agreements: Include when coordinating with other intercompany agreements
6. Tax Indemnification: Include when specific tax allocation or indemnification is required
1. Schedule A - Licensed Marks: Detailed list of all licensed trademarks, including registration numbers and status
2. Schedule B - Quality Standards: Specific quality control requirements and standards for trademark usage
3. Schedule C - Territory: Detailed description of geographic territories where license applies
4. Schedule D - Usage Guidelines: Brand guidelines and specific requirements for trademark display
5. Schedule E - Royalty Calculations: Method for calculating and documenting any required royalty payments
6. Appendix 1 - Approval Procedures: Detailed procedures for obtaining approval for new uses of trademarks
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