This agreement is essential evidence – which is also valid in the courts – to ensure that the protected component is not copied and manufactured illegally. A licensing agreement between a trademark holder and a manufacturer is an official document indicating that the manufacturer of a product is authorized to manufacture the product by the company or by the person who protected it. However, the trademark holder may choose the terms of the licence for this contract. Let`s now take a look at the details contained in this agreement: the contract must then be signed and approved by the trademark holder and the manufacturer before becoming valid. Let`s understand the purpose of this document by an example: if ABC Industries wants to manufacture a simple mechanical component that will be useful to a particular machine, but Sir.M already has the brand license for this particular mechanical component. In this case, ABC`s industries must enter into a licensing agreement with Mr. . . M and develop an agreement stipulating that ABC Industries has only the right to produce the mechanical component in question, for a customer in question and only in specific numbers.