What is the geographic scope of Chocolate Bash's right to sublicense its trademarks?
Chocolate_Bash Franchise · 2024 FDDAnswer from 2024 FDD Document
Albasha, LLC, our affiliate, owns the trademarks described in this Item. Under an Intercompany License Agreement between us and Albasha, LLC, we have been granted the exclusive right to sublicense the trademarks to franchisees throughout the United States. The agreement is of perpetual duration. It may be modified only by mutual consent of the parties. It may be canceled by our affiliate only if (1) we materially misuse the trademarks and fail to correct the misuse, or (2) we discontinue commercial use of the trademarks for a continuous period of more than one year. The Intercompany License Agreement specifies that if it is ever terminated, your franchise rights will remain unaffected.
Source: Item 13 — TRADEMARKS (FDD pages 26–28)
What This Means (2024 FDD)
According to Chocolate Bash's 2024 Franchise Disclosure Document, Chocolate Bash has been granted the exclusive right to sublicense its trademarks to franchisees throughout the United States. This right is established through an Intercompany License Agreement with Albasha, LLC, the affiliate that owns the trademarks. The agreement is perpetual, meaning it lasts indefinitely, and can only be modified with the mutual consent of both Chocolate Bash and Albasha, LLC.
This agreement can only be canceled by Albasha, LLC if Chocolate Bash materially misuses the trademarks and fails to correct the misuse, or if Chocolate Bash discontinues commercial use of the trademarks for a continuous period of more than one year. Importantly, the Intercompany License Agreement ensures that even if the agreement is terminated, the franchisee's rights will remain unaffected.
This arrangement provides Chocolate Bash franchisees with the assurance that they can legally use the Chocolate Bash trademarks within the United States. It also protects franchisees against claims of infringement or unfair competition arising from their use of the trademarks, as long as they adhere to the terms of the franchise agreement. Chocolate Bash also commits to defending franchisees against legal actions related to trademark infringement and will cover expenses and damages if the legal action is resolved unfavorably to the franchisee.