Renewable Market Right Licenses

Question

We are about to take our business over to the USA. We have developed, patented and manufactured our raised deck exhibition system made out of carbon fibre. The company that we will potentially go into business with have started asking for an exclusivity agreement with us, im concerned with limiting our market.

Quite frankly the opportunity for our product in the USA is huge as the weight savings of our product are extremely cost effective. We have built a slow relationship with this US company over the past three years and value the relationship and input they have contributed. I dont want to limit our potential market however like the ‘ease’ of dealing with one company to deal with us. Im traveling to the US next week to explore these ideas with them. I was considering a exclusivity agreement with this company for 1 year whilst they do live testing with our product at events. Then create a renewable market right license. We are also considering creating a manufacturing hub in the USA for the creation of our product for the US market. The intention would be to rent/lease rather than sell the product, so we don’t loose control of our system and have to compete against our own product if we do sell our parts to a USA company.

I would like to get advise on a overview of options and frameworks on how these agreements could be made.

Answer

We have a lot of experience in helping UK companies bring their products to the US market, and have seen a variety of different structures. The exclusivity issue is always a big one, and usually depends on the relative bargaining position (who needs who most?). I would be happy to discuss this with you to see if we could help further. We are in Chicago.

Steve Curtis
+1 312-425-0053

Answer

I am a California attorney as well as a UK solicitor and work with many businesse expanding their operations in the US. As the other commentator says, your options depend largely on bargaining position and what other options you have. Other considerations include protection of your technology as well as the credibility and reputation of the US company. You could think of building in targets and milestones to the exclusivity agreement to give you some additional protections. Happy to discuss further.

Tracey Ginn
tginn@polsinelli.com
310/556-1801

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