Is the license granted to the franchisee to use the Proprietary Marks for the Exit franchise exclusive or non-exclusive?
Exit Franchise · 2025 FDDAnswer from 2025 FDD Document
(A) Subfranchisor, having been granted the right to do so by EXIT, grants to Franchisee, and Franchisee accepts, a non-exclusive license to use the Proprietary Marks (as defined in Section 43), for the purpose of operating
a Franchise pursuant to the terms and conditions of this Agreement, and for no other purpose. Subfranchisor and Franchisee expressly agree that ownership, right and title to the Proprietary Marks, regardless of source, are automatically vested in and shall remain solely and exclusively the property of EXIT, and are provided to Franchisee by Subfranchisor in confidence. Franchisee agrees to keep all of the Proprietary Marks in confidence, not infringe on EXIT's rights in the Proprietary Marks, not use them in any manner unless expressly authorized by EXIT, and not disclose them without the prior written consent of Subfranchisor, except as provided in this Agreement. This license is contemporaneous and coterminous with this Agreement and is granted solely in the context of this Agreement. Franchisee shall only use the Proprietary Marks with the SM, TM or ® symbols and designations, as applicable.
(B) Franchisee understands and agrees that its license to use the Proprietary Marks is non-exclusive. EXIT in its sole discretion has the right to grant franchises or licenses to others and to license to others the right to use the Proprietary Marks in addition to those franchises and licenses already granted to other franchisees and subfranchisors. EXIT may develop and license other marks in conjunction with systems other than the EXIT System, on any terms and conditions EXIT deems advisable.
Source: Item 23 — RECEIPT (FDD pages 42–235)
What This Means (2025 FDD)
According to Exit's 2025 Franchise Disclosure Document, the license granted to a franchisee to use the Proprietary Marks is non-exclusive. This means that Exit retains the right to grant additional franchises or licenses to others, allowing them to use the same Proprietary Marks. Exit can also develop and license other marks for different systems.
For a prospective Exit franchisee, this non-exclusive license means that while they have the right to use Exit's trademarks and branding, Exit is not restricted from allowing others, including competitors, to operate under the same brand or different brands using similar marks. This could lead to increased competition within the same market area.
It is important for potential franchisees to understand that Exit retains full control over its Proprietary Marks and can modify them as deemed necessary. The franchisee's use of these marks is strictly limited to operating the franchise under the terms of the agreement, and all goodwill associated with the marks ultimately benefits Exit. Franchisees must adhere to Exit's standards and policies to protect the brand's reputation and goodwill.