6143282526

NAME___________________________________STUDENT ID._______________________________
Piya pat Gana cha ra Na Ayudhy a

QUIZ 4 (5 MARKS)

Please review the following clauses and provide legal advice to your client by suggesting any risks of
the client from applying these clauses. And, suggest any issues which should be negotiated, added,
deleted or revised.

1. Your client: Licensee

Article [] – Expiry

1. On the expiry date of this Agreement, the Licensee undertakes to hand immediately to the
Licensor an inventory listing of all the Products manufactured by or for the Licensee and unsold yet,
and to stop any manufacturing of the Products, except for reasonable completion of work in process.

2. Insofar as the listing mentioned in paragraph 1 here above would show that the Licensee holds on
the expiry date of this Agreement an inventory of current lines of Products in prime condition, not
larger than three months of sales, the Licensor undertakes to buy such inventory from the Licensee
at its ex-works price, less 30% (thirty per cent).

3. In the event that the said inventory is larger than three months of sales and that the Licensor does
not want to buy the surplus (over the three months of sales it has obligated itself to buy). The
Licensee shall have to strip the distinctive labels and the Trademarks from the Products, and to
refrain from using their normal packaging and more generally the Main Trademark, and the Licensee
shall then be at liberty to sell the former products, without accounting for these sales to the
Licensor.

4. On the expiry date of this agreement, the Licensee shall give back to the Licensor all the
documents in its possession received from the Licensor, relating to the manufacturing processes and
the Products designs, accompanied by a declaration that no copies thereof have been kept.

5. Moreover, the Licensee undertakes to have available for the Licensor’s verification all the
accounting documents relating to the performance of this Agreement, during a period of three years
after it has expired.

6. The Licensee undertakes not to manufacture, directly or indirectly, within the Territory, any
products which replicate, duplicate or otherwise copy the Products and/or their style, during a
period of two years after the expiry date of this Agreement.

There are possible improvements in number 2 and 3 The Licensee would experience
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a
huge disadvantage of the extremely low buyback rate Also , if the licensee
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failed to sell out the inventory within the time limit , the label and the trademark
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will have to be eliminated which possibly left the inventory no value

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The solution of the 2nd condition could be to ask the licensor for the higher
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buyback rate
Regarding the 3rd clause , the licensee may ask for the
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expansion of the sales period in order to reduce the chance of devaluing

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the product
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 2. Your client: Distributor

Article [] – Rights following Termination

1. After termination of this Agreement, the distributor shall have the obligation to sell to the
manufacturer, or to any third party designated by the Manufacturer, any or all Products in its
inventory which will be less than four years old, at the original Manufacturer’s invoice prices, such
prices to be increased by transport and import costs.

The Distributor undertakes to provide the Manufacturer, upon its request, with a list of Products in
the inventory of the Distributor at the termination date which will be less than four years old. During
one (1) month after the receipt of such list, the Manufacturer may inspect such Products at the
Distributor’s principal place of business.

2. The Distributor shall deliver to the Manufacturer or to a third party designated by the
Manufacturer, at the Manufacturer’s expense, the Products to be repurchased in accordance with
the provisions of paragraph 1 above, must be in original packaging.

Payment by the Manufacturer for the repurchased Products shall be made immediately after the
delivery of the repurchased Products to the Manufacturer or to a third party designated by the
Manufacturer.

3. All Products not repurchased from the Distributor shall be destroyed by the Distributor, without
any compensation or indemnification being due by the Manufacturer to the Distributor in this
respect. A certificate of destruction shall be provided by the Distributor to the Manufacturer upon
the Manufacturer’s request.

4. Upon termination of this Agreement, the Distributor shall send back to the Manufacturer, or shall
forward to a third party designated by the Manufacture, all commercial, marketing, advertising and
technical documents or materials in its possession received from the Manufacturer pertaining to the
Products, accompanied by a declaration that no copies thereof have been kept.
The 3rd clause pushes the distributor in a bad position because not
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only the products will not be repurchased back to the Manufacturer,

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but the distribute r also has to absorb all of the cost by destroying
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the goods without any compensation Therefore , the distributor

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may ask for a right

to sell the product after the termination
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in a limited time period for example 3 months

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