Coexistence Agreement Template
Under this agreement, a party with a registered (and generally registered) trademark includes a series of reciprocal obligations with a party wishing to create a new trademark allowing both parties to continue to use their trademarks. In some cases, the party in place may require limited changes to the categories of goods and/or services for which the more recent party would like to use its trademark, therefore avoiding unnecessary duplication and confusion. The purpose of a brand co-existence agreement is that brands are often used in “good faith” by several companies. The lack of formal agreement does not affect a company that uses the brand, as it is present in different regions of the world. However, with business growth, overlaps can develop and both parties may have significant rights to the use of the trademark. In some cases, companies that extend and use the same brand or similar brand generally enter into a co-existence agreement to avoid the use of the trademark in an undesirable or hurtful manner. Co-existence agreements can provide practical solutions to companies that are concerned about being sued for trademark infringement, as proactive agreements can avoid the high cost of litigation.  Reaching an agreement on the coexistence of trademarks is always a risk. Perhaps in the future you would like to expand into new territories and markets and you will find limited by an agreement that you signed many years ago. A co-existence agreement may also restrict your right to transfer your trademark or your ability to enforce it. Finally, if the other company produces poor quality products or offers insufficient service, your own reputation could suffer. Sometimes co-existence agreements are concluded in the form of a proactive approval agreement.
There one party agrees to register the other party type mark with strict restrictions. A company called “XBoard,” for example, could sell surfboards in Florida and not worry about a small Vermont company that makes a children`s board game called “XBoard.” You may be happy to allow the Vermont company to register the “XBoard” brand as long as they stick to the toys and stay out of the sporting goods market. An approval agreement between the two brands will both avoid potential litigation and assist the registration process.