Is the Intercompany License between Card My Yard and CMY Holdco, LLC exclusive or nonexclusive?
Card_My_Yard Franchise · 2025 FDDAnswer from 2025 FDD Document
Our rights to the Marks and the proprietary Business System know-how are derived from a nonexclusive perpetual license (the "Intercompany License") between us and our affiliate, CMY Holdco, LLC (successor-ininterest to Card My Yard, LLC). The Intercompany License grants us the right to use the Marks and the proprietary information related to the Business System, such as the know-how and the Manuals, for the purpose of licensing them to our franchisees and fulfilling our obligations under the Franchise Agreement. The Intercompany License is terminable only for material breach of the Intercompany License agreement and only if we do not cure or begin to cure the breach within 90 days after notice. If the Intercompany License agreement is terminated by us or CMY Holdco, LLC then CMY Holdco, LLC will permit you to continue using the Marks under your franchise agreement until the expiration or earlier termination of such franchise agreement (plus one renewal period if the agreement is set to expire and you meet all renewal criteria set forth in your Franchise Agreement). We know of no other agreements currently in effect which significantly limit our rights to use or license the use of the Marks in any manner material to you.
Source: Item 13 — TRADEMARKS (FDD pages 46–48)
What This Means (2025 FDD)
According to Card My Yard's 2025 Franchise Disclosure Document, the Intercompany License between Card My Yard and its affiliate, CMY Holdco, LLC, is nonexclusive. This license grants Card My Yard the right to use the trademarks and proprietary information related to the Business System. This includes know-how and manuals, for the purpose of licensing them to franchisees and fulfilling obligations under the Franchise Agreement.
Since the license is nonexclusive, CMY Holdco, LLC could potentially license the same trademarks and proprietary information to other parties. However, the FDD indicates that the Intercompany License is critical for Card My Yard to fulfill its obligations to franchisees. The license is perpetual and only terminable for material breach of the Intercompany License agreement if Card My Yard does not cure or begin to cure the breach within 90 days after notice.
In the event that the Intercompany License agreement is terminated by either Card My Yard or CMY Holdco, LLC, CMY Holdco, LLC will allow franchisees to continue using the marks under their franchise agreement until the agreement's expiration or earlier termination, including one renewal period if the franchisee meets all renewal criteria. This provision offers some security to franchisees, ensuring they can continue operating under the Card My Yard brand even if the Intercompany License is terminated.