What is the Exit franchisee's responsibility regarding reporting imitations and infringements of the trade name, service mark, and the System?
Exit Franchise · 2025 FDDAnswer from 2025 FDD Document
(D) Franchisee shall make every effort to protect, maintain and advance the trade name, service mark, and the System, and shall report imitations and infringements upon them.
8.5. Goodwill
- (A) Franchisee acknowledges EXIT's claim to the exclusive right, title and interest to the Proprietary Marks and acknowledges that any and all goodwill associated with and identified with the Proprietary Marks, including any goodwill which may result from Franchisee's use of the Proprietary Marks, shall inure directly and exclusively to the benefit of EXIT. On the expiration or termination of this Agreement, no monetary value shall be assigned as attributable to or associated with Franchisee's activities as a Franchisee under the Proprietary Marks.
- (B) Franchisee agrees not to make any disparaging remarks, comments or communications, whether oral or written, regarding Subfranchisor or EXIT, or any of their respective officers or directors.
8.6. Incontestability
Franchisee shall not directly or indirectly contest or aid in the contesting of the validity or ownership of any of the Proprietary Marks, or take any action which might affect or prejudice Subfranchisor's or EXIT's rights in or to the Proprietary Marks. The foregoing agreement shall survive the termination of this Agreement.
8.7. Uniform Policies
In order to develop and maintain high and uniform standards of quality and service, and thus protect the reputation and goodwill of EXIT and all those involved in the EXIT System, Franchisee covenants (i) to adopt and use for the purposes expressed in this Agreement, at its own cost and expense, any changes in the Proprietary Marks or Training Manuals as if they were part of the EXIT System at the time this Agreement was executed; and (ii) to obtain advance written approval from Subfranchisor for the total appearance of the trade name and logo incorporating Franchisee's name or other identifying words.
8.8. Training Manuals and EXIT System
Source: Item 23 — RECEIPT (FDD pages 42–235)
What This Means (2025 FDD)
According to Exit's 2025 Franchise Disclosure Document, franchisees have specific responsibilities regarding the protection of Exit's trade name, service mark, and overall System. Franchisees must make every effort to protect, maintain, and advance the trade name, service mark, and the System. This includes a proactive approach to safeguarding Exit's brand identity. A key part of this is the franchisee's duty to report any imitations or infringements upon them. This means that if a franchisee observes any unauthorized use or attempts to copy Exit's branding or operational methods, they are obligated to inform the subfranchisor.
In addition to the general obligation to protect the brand, Exit franchisees must promptly notify the subfranchisor of any claims, demands, or suits arising from attempts by others to use the Proprietary Marks or similar variations. They must also report any litigation against Exit, the subfranchisor, or any franchisee involving the Proprietary Marks. Franchisees are required to report all likely infringements of the Proprietary Marks to the subfranchisor and assist in resolving conflicts. However, franchisees are not entitled to reimbursement or remuneration for this assistance. The subfranchisor will then investigate and take appropriate action to protect the Proprietary Marks.
Furthermore, if Exit or the subfranchisor decides to defend or prosecute any litigation related to the Proprietary Marks, the franchisee must provide assistance. This includes executing documents and performing actions deemed necessary by legal counsel for Exit or the subfranchisor, again without any expectation of reimbursement or remuneration. This demonstrates that Exit places a strong emphasis on protecting its brand and requires franchisees to actively participate in these efforts, even if it means incurring some costs in terms of time and effort.
These requirements highlight the importance Exit places on protecting its intellectual property and brand reputation. By actively involving franchisees in monitoring and reporting potential infringements, Exit aims to maintain a consistent and protected brand image. Prospective franchisees should understand that this responsibility is a condition of their franchise agreement and requires them to be vigilant in safeguarding Exit's brand assets.