Are Belocal and The N2 Company allowed to mutually agree to modify the terms of the Intercompany License?
Belocal Franchise · 2025 FDDAnswer from 2025 FDD Document
Our rights to the Marks and the proprietary System know-how are derived from a non-exclusive, perpetual license ("Intercompany License") between us and The N2 Company. The Intercompany License grants us the right to use the Marks and the proprietary information related to the System, such as the know-how and the Franchise Brand Standards Manual, for the purpose of licensing them to our franchisees and fulfilling our obligations under the Franchise Agreement. The Intercompany License is perpetual and terminable only for material breach of the Intercompany License agreement and only if we do not cure or begin to cure such breach within 90 days after notice. We and The N2 Company may also mutually agree to modify the terms of the Intercompany License. Termination of the Intercompany License will not change the effectiveness of any Franchise Agreement as long as you are not in default under such Franchise Agreement.
Source: Item 13 — TRADEMARKS (FDD pages 44–46)
What This Means (2025 FDD)
According to Belocal's 2025 Franchise Disclosure Document, Belocal's rights to use the marks and proprietary system know-how are derived from a non-exclusive, perpetual license with The N2 Company, called the "Intercompany License." This license grants Belocal the right to use the marks and proprietary information to license them to its franchisees and fulfill its obligations under the Franchise Agreement.
The Intercompany License is perpetual and can only be terminated if there is a material breach of the agreement, and Belocal does not cure or begin to cure the breach within 90 days after notice. Importantly, Belocal and The N2 Company can mutually agree to modify the terms of the Intercompany License. Termination of the Intercompany License will not affect any Franchise Agreement as long as the franchisee is not in default under the agreement.
This arrangement has implications for prospective franchisees. While the Intercompany License allows Belocal to grant franchisees the right to use the trademarks and system, the ability for Belocal and The N2 Company to modify the license terms could potentially impact franchisees in the future. However, the FDD states that termination of the Intercompany License will not affect a franchisee's agreement as long as they are not in default.