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Home / Business Contracts / Sign Advertising Agreement

What is a Sign Advertising Agreement?

Traditional or print signage is still one of the most effective ways of marketing your business. Having your firm’s name and logo visible to the general public increases potential for reaching new customers.

If you already own a building, you can display your business logo directly on your structure. But for companies that don’t have their own properties, leasing space on a strategically-located building is the best option.

Whether you’re the business owner planning to lease advertising space or the building owner who rents out space, it’s important that you have a sign advertising agreement in place.

When do I need a Sign Advertising Agreement?

If you’re a building owner or manager planning to lease space on your property for advertisement purposes, you should consider signing an agreement with your client.

Companies looking to lease space for a sign should also consider having a contract in place. This way, each party is well-informed of their respective obligations and the regulations they should comply with.

What are the Main Clauses in a Sign Advertising Agreement?

Parties to the Agreement – This section highlights personal information of all the parties involved. This entails their names, physical addresses and contact details.

In the case of the company wishing to put up a sign, they should provide the exact name as it’s registered by the state. Similarly, the other party- building owner or manager- ought to provide precise details of their identity.

Sign Placement – One of the main clauses that should be included in this contract has to do with the sign’s placement. Essentially, it should explain the specific location where the sign will be placed to guarantee optimal visibility.

The building owner, on his/ her part, has to do everything in their power to protect the sign’s visibility. This restricts them from erecting objects that would obstruct the sign.

Advertising Content – A sign advertising agreement should also clarify the type of content that the advertiser is allowed to post.

To avoid liability issues, the building owner may ask the business to:

  • Post only accurate ads
  • Comply with the state laws and regulations regarding outdoor signage content
  • Avoid using content that could be construed as being deceptive, defamatory, fraudulent or misleading
  • Avoid posting material that’s likely to encourage illegal activity
  • Avoid content, which infringes the copyright or trademark of another entity

Apart from placement, this section should also clarify the type of signs allowed on the building. Can the advertiser use animated signs? What about colored lights? If the sign requires illumination, which party will be liable for utility bills? Similarly, whose responsibility is it to maintain the sign?

Leasing Duration – One of the main benefits of an outdoor sign is that it’s timeless. It enables you to market your products and services all day and night, all year-long. Still, it’s crucial that the parties agree on a specific leasing duration.

The building owner can agree to run the advertisement for a couple of weeks, months or even a whole year.

However, some instances can necessitate more short-term leasing agreements. For example, if the property owner plans to reconstruct or renovate the building, this will impact the viability of maintaining the sign within the premises.

Contract Termination – This clause explains which particular party has the right to terminate the agreement and the circumstances that may result in such.

For instance, the advertiser may choose to end the contract if a third-party erects a structure that obscures the sign. The building owner can also decide to terminate the agreement if the advertiser posts inappropriate content.

In the event of a termination, the contract should outline the procedure to be followed by either party. It should explain when and how the remaining payment(s) will be made as well as how long the advertiser has to pull down the advertisement.

Remuneration – The building owner and advertiser also have to agree on a reasonable mode of payment. Most property owners prefer being paid in the form of a commission of the revenue generated from the sign. If the building is located in a particularly strategic spot, the advertiser is likely going to pay more for the ad space.

Based on the leasing period, the two parties should also agree on the frequency of payment. For example, the advertiser can pay a one-off cost or a monthly basis.

Dispute Resolution – A sign advertising agreement should clearly state the steps to be taken in case there’s a conflict between the parties involved. Some of the points that ought to be addressed under this section include:

  • Which party can initiate the dispute resolution process
  • Resolution techniques to be employed in case of a conflict e.g. collaboration and reconciliation
  • Procedure to be followed if the dispute is not solved within a given timeframe
  • Circumstances that warrant involving a third-party such as an arbitrator or a court of law

Wrap Up

A sign advertising contract is an agreement between a building/property owner and a company wishing to advertise its products and/or services on the said structure.

This document defines all the nitty-gritty details of the pact between the advertiser and landlord or building owner. These include crucial details such as the type of content that can be posted on the sign, period of leasing the advertising space, situations that could lead to termination and how to manage conflict.

Any questions – put up a sign and hopefully we will see it! ha

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