When might a shareholder licence the use of a trade mark to a company?

One of the shareholders in a company may own the trade mark which the company requires for its business. The shareholder may wish to retain the ownership of the trade mark and allow the company to use the trade mark in its business whilst the shareholder remains a shareholder in the company. The licence of the trade mark by the shareholder might be: exclusive or non-exclusive: if exclusive, the shareholder will not be permitted to allow other third parties to use the trade mark whilst the licence is in force limited to a particular territory royalty free or subject to payment of a royalty, for example a royalty of a specified percentage of the sales made by the company The licensing shareholder will want to retain control of the manner in which its trade mark is used by the company. The licensing shareholder may also want the licence to come to an end should it cease to be a shareholder in the company.

Shareholder Trade Mark Licence

Name: Shareholder Trade Mark Licence - PaperRock Documents
SKU: SHA006.001
Price: 35.00 GBP
Availability: InStock

Trade mark licence from a shareholder to a company, for the grant of a licence to the company to use trade marks owned by the shareholder for the company’s business.

for a licence of trade marks from a shareholder to a company
for registered and/or unregistered trade marks
for a licensee company which is a private limited company incorporated in England and Wales

What are the key features?

17 clauses and one schedule over 11 pages
alternative wording depending on whether the licence is exclusive or non-exclusive
optional provisions for either a royalty-free licence or for payment of a royalty based on the percentage of sales
restrictions on the use of the trade marks by the company
termination rights for the licensor, including the licensor ceasing to be a shareholder in the licensee

What else do I need to know?

One of the shareholders in a company may own a trade mark which the company requires for its business.

The shareholder may want to retain the ownership of the trade mark but to allow the company to use the trade mark in its business whilst the shareholder remains a shareholder in the company.

The licence of the trade mark could be:

exclusive or non-exclusive: if exclusive, the shareholder will not be permitted to allow other third parties to use the trade mark whilst the licence is in force
limited to a particular territory
royalty free or subject to payment of a royalty, for example a royalty of a specified percentage of the sales made by the company

The licensing shareholder will want to retain control of the manner in which its trade mark is used by the company.

The licensing shareholder may also want the licence to come to an end should it cease to be a shareholder in the company.

Description

When do I use this document?

if a shareholder has lost its original share certificate or it has been destroyed
if applicable, alongside a transfer of the shares covered by the lost or destroyed original certificate

What are the key features?

different forms of indemnity, depending on whether the shareholder is also transferring shares
alternative forms of indemnity, depending on whether the shareholder is an individual or a company

What else do I need to know?

What is a share certificate?

A share certificate is a document evidencing ownership of shares in a company. By law, shareholders are entitled to receive this certificate when they acquire shares, either through allotment or transfer.

What happens if a share certificate is lost or destroyed?

If a shareholder loses or destroys their certificate, they can ask the company for a replacement. To safeguard itself, the company will usually require a lost share certificate indemnity. This is a legal undertaking under which the shareholder agrees to cover any losses the company might face by issuing the replacement.

What risks does the indemnity protect against?

The indemnity protects the company from risks such as:

Duplicate Claims: If the original certificate reappears, someone else might claim ownership, causing disputes or financial loss.
Fraudulent Claims: A person could falsely claim to have lost the certificate and misuse the replacement, for example, by attempting to sell the shares unlawfully.
Administrative Errors: Mistakes in issuing a replacement or registering a transfer without the original certificate could lead to legal administrative errors.
Legal Liability: If a replacement certificate or transfer is improperly handled, the company might be held responsible for resulting losses.

Explanatory Guides

As with all of our document templates, your purchase will include access to clear explanatory guidance on the document and its use.

£35.00 exc VAT

Updated by a lawyer on 21/07/2025

Updated By a lawyer on 03/13/2023

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Shareholder Trade Mark Licence