Will a Cicis franchisee's rights to use the Marks during the current term of their Franchise Agreement be affected by the termination or expiration of Cicis' license?
Cicis Franchise · 2025 FDDAnswer from 2025 FDD Document
Pursuant to the Trademark Assignment Agreement dated March 10, 2021, CiCi Enterprises assigned its ownership interest in the Marks to Yes Caps. Under the Trademark License
Agreement, dated March 10, 2021 (the "License Agreement"), Yes Caps has granted us a license to use and sublicense the use of the Marks. The License Agreement has a perpetual term and can be terminated on 60 days' notice (resulting in the loss of our right to use and to sublicense the use of the Marks). Your rights to use the Marks during the current term of your Franchise Agreement will not be affected by the termination or expiration of our license. We would not be able to grant additional licenses of the Marks after expiration or termination of our license.
Source: Item 13 — TRADEMARKS (FDD pages 41–42)
What This Means (2025 FDD)
According to Cicis's 2025 Franchise Disclosure Document, a franchisee's rights to use Cicis's trademarks during the current term of their Franchise Agreement will not be affected if Cicis's license to use those marks is terminated or expires. Yes Caps owns the Marks and has granted Cicis a license to use and sublicense the use of the Marks through a Trademark License Agreement dated March 10, 2021. This license has a perpetual term but can be terminated with 60 days' notice, which would result in Cicis losing the right to use and sublicense the Marks. However, this termination would not impact existing franchisees during their current agreement term.
This provision offers a degree of security for Cicis franchisees. Even if Cicis loses its license to use the trademarks, franchisees can continue operating under the Cicis brand for the remainder of their current franchise term. This protection is significant because rebranding can be costly and disruptive to a business.
However, Cicis would not be able to grant additional licenses of the Marks after the expiration or termination of their license. This implies that while existing franchisees are protected during their current term, the long-term prospects of the franchise system could be affected if Cicis loses its right to sublicense the trademarks, as it would prevent them from expanding the franchise network.