In the new Louisville Business First Legal Forum Column, BGD attorney Michael J. McGee discussed sponsorship agreements. Read his advice below and don’t miss our monthly Legal Forum Column in Louisville Business First.

Topic

From a legal perspective, what are some of the concerns that companies must take into account when entering into a sponsorship? 

Advice

A company can avoid many potential legal pitfalls by reducing the terms of the sponsorship to a specific and binding written sponsorship agreement—a verbal deal on a handshake is a risky proposition.  

Specifically, the parties should consider and clearly delineate the parameters of the sponsor relationship in writing to include the monetary compensation and payment terms for the sponsorship, the terms of use regarding sponsorship materials (including trademarks and the like), and exclusivity. Remember, it is critical to establish the specific realm of exclusivity to help eliminate competition and bolster the value of the sponsorship. 

Because each sponsorship relationship is unique, companies should not rely on pre-written contracts; a specific document written by a qualified attorney is the best option to protect both parties involved.