How can the Intercompany License Agreement for Chocolate Bash be modified?
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, the Intercompany License Agreement between Chocolate Bash and its affiliate, Albasha, LLC, which grants Chocolate Bash the exclusive right to sublicense trademarks to franchisees, can only be modified by mutual consent of both parties. This agreement is of perpetual duration, meaning it continues indefinitely unless specific conditions for cancellation are met.
This stipulation means that any changes to the agreement require both Chocolate Bash and Albasha, LLC, to agree on the modifications. A prospective franchisee should understand that they have no direct influence over this agreement, as it exists solely between the franchisor and its affiliate. Any concerns about the trademark licensing should be addressed to Chocolate Bash, keeping in mind that changes to the underlying agreement are subject to mutual consent.
The Intercompany License Agreement can be canceled by Albasha, LLC, only 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. However, the agreement specifies that even if it is terminated, a franchisee's rights will remain unaffected. This provides some assurance to franchisees that their right to use the trademarks will continue even if the Intercompany License Agreement is canceled.