I have an asset purchase of a retail store transaction. Seller is keeping the second location. Seller is licensing the name from the buyer. The licensing agreement is supposed to contain provisions so that the seller cannot offer promotions or discounts that the buyer does not also offer (i.e., seller cannot undercut buyer's pricing). I know very little about antitrust. Can anyone give me some suggestions how to enforceably draft this agreement, or is this arrangement impossible?

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As someone who used to be in business (now in private practice) this seems uber tricky to me on several practical fronts - beyond just pricing conflict (which is similar to channel conflict). There could be issues as to brand/image policing, potential quality issues, customer/supplier/vendor confusion, etc. If you do this, I think that brand license you mentioned would need to be super meaty, and you might even want to sit down with your field/on-the-ground management to pick their brains on the possible challenges too, so you can work those into the deal. Good luck!

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This arrangement seems to implicate franchising laws. I'd definitely confirm my client is not inadvertently violating those laws with this structure.

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Are there only two locations? Is there that much value in the name?

This is a clear definition of price fixing.

I believe the distinction that deputy general counsel 1 is stating this circumstance is different in this situation, as compared to franchises and/or distributors, because unlike here there is an agreement to sell/buy from one another and/or work directly under a parent company. Comparatively, here, there are no such agreements (assumingely so). Therefore, these two separate and distinct companies without any distributor agreement or parent/sub agreement are unilaterally deciding the price floor for that particular market. It seems to be okay to set these floors if it’s done incidentally to your agreement w a distributor for example, but it’s not okay here, because it’s not as though company A is trying to maintain a certain profit on its wholesale to a distributor. Rather, they’re just trying to ensure a particular floor in general. Also trying to understand myself. Is that the correct line of distinction you were alluding to?

Is the promotions / discounts provision a non-negotiable? Or is the buyer really trying to get at a brand issue - ie the buyer does want the brand it is licensing to be diminished by lower prices? If the latter, I wonder if you could work something like into the quality control provisions of the trademark license.

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